Passenger traffic tumbles 72{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} in January, but air cargo demand recovers to pre-pandemic levels

JANUARY air passenger demand fell 72{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} compared to the pre-Covid level in January 2019, revealed the International Air Transport Association (IATA).

The traffic volume, measured in revenue
passenger kilometres (RPKs), was worse than the 69.7{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} year-over-year decline
recorded in December 2020.

International passenger demand in the same
month was 85.6{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} below that of the same month in 2019, a further drop compared
to the 85.3{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} year-to-year decline recorded in December.

“This year is starting off worse than 2020 ended and that is saying a lot. Even as vaccination programmes gather pace, new Covid variants are leading governments to increase travel restrictions,” Alexandre de Juniac, IATA’s director general and CEO, said in a statement.

“The uncertainty around how long these restrictions will last also has an impact on future travel. Forward bookings in February this year for the Northern Hemisphere summer travel season were 78{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} below levels in February 2019.”

According to IATA, “comparisons between 2021 and 2020 monthly results were distorted by the extraordinary impact of Covid-19”, and they were compared to January 2019 that followed a normal demand pattern.

Snapshot of international markets performance

• Asia Pacific airlines’ January traffic plummeted 94.6{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} compared to the same month in 2019 – unchanged from the 94.4{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} decline in December 2020 compared to a year ago. The region continued to suffer from the steepest traffic declines for a seventh consecutive month. Capacity dropped 86.5{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} and load factor sank 49.4 percentage points to 32.6{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9}, by far the lowest among regions.
• European carriers had an 83.2{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} decline in traffic in January versus January 2019, worsened from an 82.6{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} decline in December compared to January 2019. Capacity sank 73.6{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} and load factor fell by 29.2 percentage points to 51.4{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9}.
• Middle Eastern airlines saw demand plunge 82.3{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} in January compared to the same month in 2019, which was broadly unchanged from an 82.6{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} demand drop in December versus a year ago. Capacity fell 67.6{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9}, and load factor declined 33.9 percentage points to 40.8{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9}.
• North American carriers’ January traffic fell 79.0{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} compared to the 2019 period, up slightly from a 79.5{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} decline in December year to year. Capacity sagged 60.5{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9}, and load factor dropped 37.8 percentage points to 42.9{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9}.
• Latin American airlines experienced a 78.5{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} demand drop in January, compared to the same month in 2019, worsened from a 76.2{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} decline in December year-to-year. January capacity was 67.9{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} down compared to January 2019 and load factor dropped 27.2 percentage points to 55.3{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9}, highest among the regions for a fourth consecutive month.
• African airlines’ traffic dropped 66.1{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} in January, which was a modest improvement compared to a 68.8{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} decline recorded in December versus a year ago. January capacity contracted 54.2{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} versus January 2019, and load factor fell 18.4 percentage points to 52.3{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9}.

“To say that 2021 has not gotten off to a good start is an understatement. Financial prospects for the year are worsening as governments tighten travel restrictions. We now expect the industry to burn through $75-$95 billion in cash this year, rather than turning cash positive in the fourth quarter as previously thought. This is not something that the industry will be able to endure without additional relief measures from governments,” commented de Juniac on the drop in traffic.

“Increased testing capability and vaccine distribution are the keys for governments to unlock economic activity, including travel,” he suggested. “It is critical that governments build and share their restart plans along with the benchmarks that will guide them. This will enable the industry to be prepared to energise the recovery without any unnecessary delay.”

The IATA chief opined that global standards to securely record test and vaccination data in formats, which will be internationally recognised, are urgently needed.

“These will be critical to restarting
international travel if governments continue to require verified testing or
vaccination data. IATA will soon launch the IATA Travel Pass to help travellers
and governments manage digital health credentials. But the full benefit of IATA
Travel Pass cannot be realized until governments agree the standards for the
information they want,” he added.

• View the full January Air Passenger Market Analysis (including 2021 vs. 2020 comparisons PDF)

Air cargo demand back to pre-crisis levels, “some much-needed good news for the global economy”

But it is not all gloom and doom in aviation – the good news is cargo, as it is performing reasonably well. Data for global air cargo markets showed that air cargo demand returned to pre-Covid levels (January 2019) for the first time since the onset of the crisis. January demand also showed strong month-to-month growth over December 2020 levels.

Global air cargo demand, measured in cargo
tonne-kilometres (CTK), was up 1.1.{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} compared to January 2019 and 3+{46dd52bca0123ad67b2d1222819e83fd0a56e45ca5068239f05f0c514f1e20f9} compared
to December 2020.

All regions saw month-on-month improvement in air cargo demand, and North America and Africa were the strongest performers.

De Juniac said the steady performance of air cargo traffic is “some much-needed good news for the global economy,”

He, however, pointed out that the demand to
ship goods is strong, ability of airlines is capped by the shortage of belly
capacity normally provided by passenger aircraft.

“That should be a sign to governments that
they need to share their plans for restart so that the industry has clarity in
terms of how soon more capacity can be brought online. In normal times, a third
of world trade by value moves by air. This high value commerce is vital to
helping restore Covid damaged economies—not to mention the critical role air
cargo is playing in distributing lifesaving vaccines that must continue for the
foreseeable future.”

• View the January 2021 Air Cargo Market Analysia (PDF) 

• Featured image credit: Wittayayut/Getty Images