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IATA: COVID-19 Hits January Passenger Demand; Air Cargo Demand Down 3.3% in January 2020

- Geneva, Switzerland.

The International Air Transport Association (IATA) announced global passenger traffic data for January 2020 showing that demand (measured in total revenue passenger kilometers or RPKs) climbed 2.4% compared to January 2019. This was down from 4.6% year-over-year growth for the prior month and is the lowest monthly increase since April 2010, at the time of the volcanic ash cloud crisis in Europe that led to massive airspace closures and flight cancellations. January capacity (available seat kilometers or ASKs) increased by 1.7%. Load factor climbed 0.6 percentage point to 80.3%. 

“January was just the tip of the iceberg in terms of the traffic impacts we are seeing owing to the COVID-19 outbreak, given that major travel restrictions in China did not begin until 23 January. Nevertheless, it was still enough to cause our slowest traffic growth in nearly a decade,” said Alexandre de Juniac, IATA’s Director General and CEO.

January 2020 (% year-on-year)

World share1

RPK

ASK

PLF (%-pt)2

PLF (level)3

Total Market 

100.0%

2.4%

1.7%

0.6%

80.3%

Africa

2.1%

5.2%

6.1%

-0.6%

70.2%

Asia Pacific

34.7%

0.4%

2.2%

-1.5%

79.9%

Europe

26.8%

1.6%

-0.5%

1.7%

81.6%

Latin America

5.1%

0.4%

0.0%

0.3%

82.6%

Middle East

9.0%

5.9%

0.6%

3.9%

78.5%

North America

22.2%

5.7%

3.6%

1.6%

81.2%

1% of industry RPKs in 2019  2Year-on-year change in load factor 3Load Factor Level

 

January international passenger demand rose 2.5% compared to January 2019, down from 3.7% growth the previous month. With the exception of Latin America, all regions recorded increases, led by airlines in Africa and the Middle East that saw minimal impact from the COVID-19 outbreak in January. Capacity climbed 0.9%, and load factor rose 1.2 percentage points to 81.1%.

 

  • Asia-Pacific airlines’ January traffic climbed 2.5% compared to the year-ago period, which was the slowest outcome since early 2013 and a decline from the 3.9% increase in December. Softer GDP growth in several of the region’s key economies was compounded by COVID-19 impacts on the international China market. Capacity rose 3.0% and load factor slid 0.4 percentage point to 81.6%.
     
  • European carriers saw January demand climb just 1.6% year-to-year, down from 2.7% in December. Results were impacted by slumping GDP growth in leading economies during the 2019 fourth quarter plus flight cancellations related to COVID-19 in late January. Capacity fell 1.0%, and load factor lifted 2.1 percentage points to 82.7%.
     
  • Middle Eastern airlines posted a 5.4% traffic increase in January, the fourth consecutive month of solid demand growth, reflecting strong performance from larger Europe-Middle East and Middle East-Asia routes, which were not significantly impacted by route cancellations related to COVID-19 at that time. Capacity increased just 0.5%, with load factor jumping 3.6 percentage points to 78.3%.  
     
  • North American carriers’ international demand rose 2.9% compared to January a year ago, which represented a slowdown from the 5.2% growth recorded in December, although there were no significant flight cancellations to Asia in January. Capacity climbed 1.6%, and load factor grew by 1.0 percentage point to 81.7%.
     
  • Latin American airlines experienced a 3.7% demand drop in January compared to the same month last year, which was a further deterioration compared to a 1.3% decline in December. Traffic for Latin American carriers has now been particularly weak for four consecutive months, reflecting continued social unrest and economic difficulties in a number of countries in the region unrelated to COVID-19. Capacity fell 4.0% and load factor edged up 0.2 percentage point to 82.7%.
     

African airlines’ traffic climbed 5.3% in January, up slightly from 5.1% growth in December. Capacity rose 5.7%, however, and load factor slipped 0.3 percentage point to 70.5%.

Domestic Passenger Markets

Demand for domestic travel climbed 2.3% in January compared to January 2019, as strong growth in the US helped mitigate the impact from a steep decline in China’s domestic traffic. Capacity rose 3.0% and load factor dipped 0.5 percentage point to 78.9%.

January 2020 (% year-on-year)

World share1

RPK

ASK

PLF (%-pt)2

PLF (level)3

Domestic

36.2%

2.3%

3.0%

-0.5%

78.9%

Australia

0.8%

0.1%

-1.4%

1.2%

79.3%

Brazil

1.1%

2.1%

0.1%

1.6%

85.7%

China P.R.

9.8%

-6.8%

-0.2%

-5.4%

76.7%

India

1.6%

2.5%

2.3%

0.1%

86.1%

Japan

1.1%

3.8%

1.9%

1.3%

68.1%

Russian Fed.

1.5%

3.9%

8.3%

-3.1%

72.2%

US

14.0%

7.5%

4.9%

1.9%

81.1%

1% of industry RPKs in 2019  2Year-on-year change in load factor 3Load Factor Level
  • Chinese airlines' domestic traffic fell 6.8% in January, reflecting the impact of flight cancellations and travel restrictions related to COVID-19. China’s Ministry of Transport reported an 80% annual fall in volumes in late January and early February. Capacity slipped 0.2% and passenger load factor plunged 5.4 percentage points to 76.7%.
     
  • US airlines saw domestic traffic climb 7.5% in January. Although this was down from 10.1% growth in December, it represented another strong month of demand growth reflecting supportive business confidence and domestic economic outcomes at the time. Capacity rose 4.9% and load factor climbed 1.9 percentage points to 81.1%.

The Bottom Line

“The COVID-19 outbreak is a global crisis that is testing the resilience not only of the airline industry but of the global economy. Airlines are experiencing double-digit declines in demand, and on many routes traffic has collapsed. Aircraft are being parked and employees are being asked to take unpaid leave. In this emergency, governments need to consider the maintenance of air transport links in their response. Suspension of the 80/20 slot use rule, and relief on airport fees at airports where demand has disappeared are two important steps that can help ensure that airlines are positioned to provide support during the crisis and eventually in the recovery,” said de Juniac. 

Read the January Air Passenger Market Analysis (pdf)

 

CARGO 

Geneva - The International Air Transport Association (IATA) released data for global air freight markets showing that demand, measured in cargo tonne kilometers (*CTKs), decreased by 3.3% in January 2020, compared to the same period in 2019. 

”January marked the tenth consecutive month of year-on-year declines in cargo volumes. The air cargo industry started the year on a weak footing. There was optimism that an easing of US-China trade tensions would give the sector a boost in 2020. But that has been overtaken by the COVID-19 outbreak, which has severely disrupted global supply chains, although it did not have a major impact on January’s cargo performance. Tough times are ahead. The course of future events is unclear, but this is a sector that has proven its resilience time and again,” said Alexandre de Juniac, IATA’s Director General and CEO.

Cargo capacity, measured in available cargo tonne kilometers (ACTKs), rose by 0.9% year-on-year in January 2020. Capacity growth has now outstripped demand growth for 21 consecutive months. 

It is unlikely that the COVID-19 outbreak had very much to do with January’s weak performance. Lunar New Year in 2020 was earlier than in 2019. This skewed 2020 numbers towards weakness as many Chinese manufacturers would be closed for the holiday period. February performance will give a better picture of how COVID-19 is impacting global air cargo.

January 2020 (% year-on-year)

World share1

CTK

ACTK

CLF (%-pt)2

CLF (level)3

Total Market

100.0%

-3.3%

0.9%

-1.9%

45.0%

Africa

1.8%

6.8%

5.9%

0.3%

35.6%

Asia Pacific

34.5%

-5.9%

0.0%

-3.0%

47.4%

Europe

23.6%

-3.7%

-3.0%

-0.3%

50.1%

Latin America

2.8%

1.4%

2.4%

-0.3%

31.1%

Middle East

13.0%

-1.4%

2.9%

-1.9%

42.6%

North America

24.3%

-1.3%

3.4%

-2.0%

42.4%

1 % of industry CTKs in 2019  2 Year-on-year change in load factor  3 Load factor level

Regional Performance

Airlines in Asia-Pacific and Europe suffered sharp declines in year-on-year growth in total air cargo volumes in January 2020, while North American and Middle East carriers experienced a more moderate decline. Latin America and Africa were the only regions to record growth in air freight demand compared to January 2019.

  • Asia-Pacific airlines saw demand for air cargo contract by 5.9% in January 2020, compared to the year-earlier period. This was the sharpest drop in freight demand of any region for the month. Capacity growth was flat. Seasonally-adjusted cargo demand rose slightly however, following the thawing of US-China trade relations. The impact from COVID-19 is expected to affect February’s performance.  
  • North American airlines saw demand decrease by 1.3% in January 2020, compared to the same period a year earlier. Capacity increased by 3.4%. Seasonally-adjusted cargo demand rose slightly however, amid a more supportive operating environment and following the thawing of US-China trade relations. 
  • European airlines posted a 3.7% decrease in cargo demand in January 2020 compared to the same period a year earlier – more than double the 1.3%% drop in year-on-year demand in December. Seasonally-adjusted demand also dropped sharply, disrupting the positive trend that started mid-2019. Capacity decreased by 3.0% year-on-year. 
  • Middle Eastern airlines’ cargo volumes decreased 1.4% in January 2020 compared to the year-ago period. Capacity increased by 2.9%. Against a backdrop of operational and geopolitical challenges facing some of the region’s key airlines, seasonally-adjusted freight volumes ticked down in January, but a modest upwards trend has been sustained. However, given the Middle East’s position connecting trade between China and the rest of the world, the region’s carriers have significant exposure to the impact of COVID-19 in the period ahead.  
  • Latin American airlines experienced an increase in freight demand in January 2020 of 1.4% compared to January 2019 – reversing the 2.5% decrease in December. Seasonally-adjusted freight volumes in the region also ticked upwards, underpinned by new route connections, which is a positive development for the region’s carriers. Capacity increased by 2.4% year-on-year.
  • African carriers posted the fastest growth of any region for the 11th consecutive month in January 2020, with an increase in demand of 6.8% compared to the same period a year earlier. Growth on the smaller Africa-Asia trade lanes (up 12.4% in 2019) contributed to the positive performance. Capacity grew 5.9% year-on-year.

View January Freight Results (pdf)

 

Contact
IATA
From
IATA
Website
www.iata.org
Date

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