IATA’s assessment of premium and economy travel in August

IATA’s assessment of premium and passenger travel on international markets was up 5.4% in August year-on-year, reflecting strong growth on the Within Europe travel market.

IATA’s assessment of premium and passenger travel on international markets was up 5.4% in August year-on-year, reflecting strong growth on the Within Europe travel market.

Both travel classes showed an above-trend rise in August year-on-year โ€“ premium travel was up 5.3% and economy travel rose 5.4%;
Economy class travel – the more price sensitive travel market โ€“ has experienced stronger growth so far this year, supported by lower fares over recent months.

Growth in premium international travel has been subdued due to weakness in business travel demand drivers, particularly in emerging markets.

The major contributor to the August industry figure (about 40%) was the Within Europe market, which includes connecting segments of longer-haul travel.

Growth in premium travel across the North Atlantic also started to accelerate, up 6.8% in August, which is a good sign for yields and revenues.

The strength of air travel activity within Europe was more than enough to offset weakness in other markets, most notably in Asia;
Looking ahead, if we extend the current trend in volumes through to the end of 2015, we could see year-on-year growth in the solid range of 4-5%.

This growth, however, is narrowly based and largely driven by travel Within Europe and across the North Atlantic.

With slowdown on key markets like Within Far East, as well as continued weakness in business confidence and world trade, the outlook for international air travel growth remains fragile.

IATA’s assessment of premium and economy travel in August

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Written by Linda Hohnholz

IATA released it’s assessment of premium and economy travel for August 2014

Key points in the report are:

IATA released it’s assessment of premium and economy travel for August 2014

Key points in the report are:
Growth in international air passengers improved in August with a rise of 4.5% compared to a year ago, up on the July result of 2.6%. Premium and economy passenger numbers rose at the same rate, 4.5%;

There was also a strong expansion in passenger numbers between August and July, which counters the negative trend seen in previous months;
The expansion in passenger numbers is consistent with signs of improving business conditions, after a period of weakness in international trade and business confidence earlier in the year;

The improvement in international passenger numbers has been supported by strong growth on markets like Europe โ€“ Far East (6.7%) and North and Mid Pacific (7.1%). The recent weakening of the Eurozone economy is yet to have an obvious impact on air travel growth;

By contrast, air travel within Far East and markets connected to South America continue to show weakness;

Economic and political turmoil in Thailand has damaged tourism demand over recent months and Malaysia air travel has been impacted by tragedies related to the flag carrier;

The North America โ€“ South America market has been hit by capacity cuts to Venezuela as well as weakness in key economies like Brazil and Argentina.

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Linda Hohnholz

Editor in chief for eTurboNews based in the eTN HQ.

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