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Lower fares help airlines fill more seats

Analysis: The hidden cost of flying

Airlines enjoyed a record average load factor on their flights during July but there are signs that the increase in demand for air travel may be “moderating”.

The latest figures from airline organisation IATA show that airlines managed to fill 84.7 per cent of their seats on average during July, an increase of 0.6 percentage points compared with the same month in 2017. This was a new record for the month of July.

But overall traffic as measured by revenue passenger kilometres (RPKs) only grew by 6.8 per cent during the month, which was down from June’s growth rate of 7.7 per cent.

IATA director general Alexandre de Juniac said: “The appetite for air travel remains very strong. However, the stimulus effect of lower fares is softening in the face of rising cost inputs. This suggests a moderating in the supportive demand backdrop.

“People want to travel and aviation connectivity is vital to the smooth functioning of the global economy. But the economic and social benefits that aviation brings need to be supported by adequate, affordable airport and air traffic management infrastructure.”

European airlines recorded the highest average load factor of 88.7 per cent of all global regions – an improvement of 1.3 points on July 2016. Traffic for Europe’s airlines grew by 7.5 per cent year-on-year, outpacing the 6.6 per cent rise in capacity.

“The economic backdrop in Europe has strengthened; however, on a seasonally-adjusted basis, the upward growth in travel demand has moderated sharply since February,” added IATA.

 

 

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