Air travel demand remains robust, but airlines face increases of around 27% in fuel costs this year compared with 2017,according to performance data for May, compiled by International Air Transport Association.
Rising fuel costs are negating the stimulus from lower fares, which could slow passenger traffic demand.
Global passenger traffic results for May showed demand (measured in revenue passenger kilometers, or RPKs) rising 6.1% compared to the same month in 2017, which was a slight pickup from 6.0% year-over-year growth for April 2018.
“May was another solid month in terms of demand growth. As had been expected, we saw some moderation, as rising airline costs are reducing the stimulus from lower airfares. In particular, jet fuel prices are expected to be up nearly 26% this year compared to 2017. Nevertheless, the record load factor for the month signifies that demand for air connectivity is strong,” said, IATA’s director general and CEO Alexandre de Juniac.
International Passenger Markets
International passenger traffic demand rose 5.8%, which was up from 4.6% growth in April. All regions recorded growth, led by Asia-Pacific airlines. Total capacity climbed 5.4%, with load factor rising 0.3 percentage point to 78.7%.
Asia-Pacific airlines saw their traffic rise 8% in May compared to the year-ago period, slightly down on an 8.1% increase in April. Capacity increased 7.6%, and load factor edged up 0.3 percentages point to 77.9%. Passenger traffic has continued to trend strongly upwards in seasonally-adjusted terms, buoyed by a combination of robust regional economic growth and increases in the number of route options for travellers….
