India's domestic air traffic falls 1.1 pc during July: IATA

According to IATA, after expanding at 20 per cent plus rates through 2010 and early 2011, the Indian market stopped growing at the end of 2011. "July capacity rose 2.1 per cent, dropping the load factor to 69.6 per cent from 71.8 per cent last year," the association said. Load factor is the ratio of the lift of an aircraft to its weight.

IATA said the global traffic results for July showed slower growth in both air travel and freight, but with considerable variation by region and market.

It said the domestic markets also experienced slow growth, continuing the trend that began early this year. "In total, traffic rose 3.1 per cent year-on year, down from 4.2 per cent in June. However, the slowdown was not universal, with China and Brazil recording strong growth that was offset by weakness in India and Japan.

 

"China's domestic market rebounded sharply from the slowdown earlier this year to post 9 per cent demand growth in July, up from the 7.8 per cent year-over-year growth seen in June. With capacity up 12.1 per cent, load factor slipped to 84.1 per cent from 86.5 per cent last year," the IATA said.

According to IATA data, July passenger demand in aggregate was 3.4 per cent higher than the same month last year, compared to a 6.3 per cent increase in June and average growth of 6.5 per cent over the first half of the year.

This slowdown in travel growth is being driven largely by the recent fall in business confidence in many economies.

"July freight demand was 3.2 per cent lower than it was in the same month last year. This is down on the 0.1 per cent year-on-year growth rate of June. A large part of that decline was due to a comparison with a relatively strong July last year, but overall the trend in air freight is weak, in line with subdued world trade growth," it said.

Airlines have responded to this slower growth environment by reducing the capacity added to markets, a move which has stabilised load factors at relatively high levels and provided some support for profitability in the face of high fuel prices.

In July, passenger capacity rose 3.6 per cent, in line with the expansion of traffic, keeping the load factor at a relatively high 83.1 per cent.

"The uncertain economic outlook is having a negative impact on demand for air transport," said Tony Tyler, IATA's Director General and CEO.

The cargo business is 3.2 per cent smaller than it was a year ago. And passenger markets