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International air traffic slumps in Nov: IATA
2008-12-30
GENEVA (AFP) - Struggling airlines hit more trouble in November, with passenger numbers down and freight plunging by a "shocking" 13.5 percent, the worst drop since the September 11 terror attacks, IATA said Tuesday. Profits at Asia-Pacific carriers, which saw the sharpest downturn in demand as the global economic crisis deepened, are expected to be "disproportionately" affected by the plunge in cargo traffic, the aviation industry group added. "The 13.5 percent drop in international cargo is shocking ... By comparison, this is the largest drop since 2001, in the aftermath of September 11," IATA chief Giovanni Bisignani said. International air passenger traffic in November was down 4.6 percent from a year earlier, marking the steepest fall in the past three months. In October, passenger traffic was down 1.3 percent after a drop of 2.9 percent in September, the International Air Transport Association noted. Asia-Pacific carriers were hurt most, with a 5.1 percent cut in capacity unable to offset a 9.7 percent decline in passenger numbers. North American airlines saw traffic slump 4.8 percent, hit by "the near collapse of the investment banking sector and consequent reductions in business travel." Even Middle Eastern airlines, which typically posted double-digit jumps in passenger traffic before the crisis, saw growth shrink to just 5.6 percent. Meanwhile, international cargo traffic in November experienced its largest drop since the September 11, 2001 terrorist attacks. "As air cargo (accounts for) 35 percent of the value of goods traded internationally, it clearly shows the rapid fall in global trade and the broadening impact of the economic slowdown," said Bisignani. Freight traffic shrank 16.9 percent for the Asia-Pacific airlines which account for almost half of all air cargo carried. "As freight accounts for a larger percentage of revenues for the Asia-Pacific carriers, fourth quarter profits for the region's carriers will be disproportionately impacted by the downturn in the global air freight market," IATA said. Latin American, North American and European carriers also posted double-digit falls in freight traffic. ABN Amro aviation analyst Sandy Morris described cargo traffic at the moment as "dismal," but he added: "I should imagine that we are probably somewhere near the bottom now." Morris was also more upbeat about the passenger sector, saying that if domestic traffic was taken into account, then overall demand was "certainly weakening but not precipitously. "The irony is that despite weakening demand, many airlines will be in better financial shape in 2009," he said, explaining that sharply lower fuel prices would more than compensate for fewer passengers. Fuel prices skyrocketed as oil soared above 140 dollars in July before plummeting to around 40 dollars now as the global economic downturn saps demand. IATA said earlier this month that it expects the industry to lose 2.5 billion dollars (1.9 billion euros) in 2009 due to the economic crisis after losses of some 5.0 billion dollars this year.
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