Freight Stabilizes: IATA

(IATA)

The International Air Transport Association (IATA) today announced international traffic statistics for the month of February showing continuing deterioration in demand.

February international freight volumes were 22.1% below 2008 levels. This is the third consecutive month at more than 20% below previous year levels (-23.2% in January and -22.6% in December).

“Gloom continues. The sharp drop in February passenger traffic shows the broadening scope of the crisis. Freight traffic, which began its decline in June 2008 before passenger markets were hit, has now had three consecutive months in the -22% to -23% range. We may have found a bottom to the freight decline, but the magnitude of the drop means that it will take time to recover,” said Giovanni Bisignani, IATA’s Director General and CEO.

• All cargo markets saw extremely weak demand continue as a result of the collapse in international trade in goods and the much lower shipment of components by manufacturers. However, the level of air freight appears to have found a floor over the past three months. The recently released Eurozone Purchase Managers Indices, being useful forward looking indicators for cargo traffic, showed a slight and unexpected improvement in March – although it remained in negative territory.

• Middle Eastern carriers experienced the smallest fall in demand (-4.8%). They were also the only region to increase capacity (+5.4%).

• African carriers had the worst performance with a 30.7% drop in international freight traffic due to a loss of market share on long-haul routes combined with the impact of the economic downturn.

• Asian carriers – the largest players in cargo – saw demand fall by 24.7% as the region’s high-value export-dependant industries were hard hit by falling consumer demand in the major markets of Europe, the U.S. and Japan. Japanese exports have almost halved from February 2008 levels.

• European and North American carriers saw cargo demand decline 23.1% and 21.8% respectively. Government stimulus plans have not yet rekindled consumer demand.

• Latin American carriers experienced a demand drop of 22.8% driven by weakening demand for the region’s commodities.

Bisignani reminded governments that air transport is a catalyst for economic activity and called for policy changes to help them to stimulate economies by playing this role effectively. “Governments are spending trillions to bailout the banks and trillions more to stimulate economies. By comparison, our requests to governments are cost-effective and cheap. First, air transport needs a tax structure that will help preserve industry jobs and allow air transport to play its role as a catalyst for broad economic activity.

Governments must repeal the US$6.9 billion in new taxes put on the industry in 2009 to help pay for banking bailouts - despite being branded as environmental measures. More broadly governments must replace the mindset of taxing aviation as a luxury or a sin with a strategic approach that recognises and fosters the industry’s critical economic role in connecting people to business and products to markets. Second, airlines need the commercial freedoms to be able to merge or consolidate where it makes business sense - even across national borders,” said Bisignani.

View full February traffic results here.