Iata: airline traffic has bottomed

DEMAND for air travel seemed to hit a floor last month, industry body the International Air Transport Association (Iata) said yesterday, while still reporting a decline in air traffic from the previous year.

Passenger demand slumped 9.3 per cent year-on-year in May, while freight demand dropped 17.4 per cent, a relative improvement compared to the 21.7 per cent drop in April.

“Since December 2008, cargo demand has been moving sideways in the 20 per cent range,” Iata said. “This is one of the first physical signs of the economic recovery being anticipated in equity markets,” it added.

But the body was reluctant to offer too much cheer, saying that, while the impact of the recession appeared to be stabilising, “strong headwinds” from debt, added to low asset prices would weaken and delay any significant recovery.

Iata said that swine flu had a one per cent impact on passenger traffic, but that Mexico’s flights had taken the brunt of the impact, with traffic in the region falling 40 per cent year on year in May.

Iata said: “this crisis is the worst we’ve ever seen”.

“We have lost several years of growth and yields are under severe pressure,” Giovanni Bisignani, IATA’s director-general said. “Airlines are in survival mode,” he added.