ME carriers see air travel demand slow down in 2018

February 9, 2019

Middle East carriers registered the slowest year-over-year international air traffic growth in 2018, recording a 4.2 per cent increase in demand compared to 2018, during which a growth of 6.9 per cent was reported.

According to figures released by the International Air Transport Association (Iata), it was the second year in a row of moderating demand growth.

Capacity climbed 5.2 per cent and load factor slipped 0.7 percentage point to 74.7 per cent. The deceleration in growth reflects the impact of policy measures and geopolitical tensions, including travel restrictions and the temporary ban on large portable electronic devices. Traffic actually declined 0.1 per cent year-on-year in December, but this may reflect volatility in data.

Asia-Pacific airlines led the international air traffic growth across all regions in 2018, with a 7.3 per cent year-over-year increase, followed by Latin American airlines (up 6.9 per cent), European carriers (up 6.6 per cent), African airlines (up 6.5 per cent), North American airlines (up 5.0 per cent), and Middle East carriers (up 4.2 per cent).

International passenger traffic in 2018 climbed 6.3 per cent compared to 2017, down from 8.6 per cent annual growth the year before. Capacity rose 5.7 per cent and load factor climbed by 0.4 percentage point to 81.2 per cent.

Domestic air travel climbed 7.0 per cent in 2018, which was unchanged from the rate in 2017. All markets showed annual growth, led by India and China, which both posted double-digit annual increases. Capacity rose 6.8 per cent and load factor was 83.0 per cent, up 0.2 percentage points compared to 2017.

The global passenger traffic results for 2018 showed that demand (revenue passenger kilometres or RPKs) rose by a healthy 6.5 per cent compared to full-year 2017. Although this represented a slowdown compared to the 2017 annual growth of 8.0 per cent, it was another year of above-trend growth. Full-year 2018 capacity climbed 6.1 per cent, and load factor edged up 0.3 percentage point to a record 81.9 per cent, exceeding the previous high set in 2017.

December RPKs rose 5.3 per cent against the same month in 2017, the slowest year-over-year pace since January 2018 and a continuation of the trend that saw demand growth decelerate to an annualised rate of 5 per cent over the course of the 2018 second half compared to a 9 per cent pace in the first half.

“2018 was another year of strong passenger demand, as aviation continued to support the global economy. We expect similar, if somewhat moderating performance in 2019. Nevertheless, slowing growth in the second half of 2018, coupled with concerns over issues including Brexit and US-China trade tensions, are creating some uncertainty to this positive outlook,” said Alexandre de Juniac, Iata’s director general and CEO.

“Aviation continued to demonstrate why it is the Business of Freedom in 2018. We safely transported more than 4.3 billion passengers. These people used air connectivity to conduct trade and business, reunite with friends and loved ones, explore the world, and, in some cases even to begin new lives. Aviation makes the modern world possible, but we depend on borders that are open to people and trade to be effective. In 2019, we will be strong advocates against a rising tide of protectionism and trade conflict, so that the Business of Freedom can continue to do its part to make the world a more prosperous and happier place,” said de Juniac.