Trade wars and Brexit uncertainty are contributing to a weaker demand environment than in 2018.

Passenger numbers

The latest figures from the International Air Transport Association (IATA) show that global passenger demand slowed in July.

Demand—measured in revenue passenger kilometers (RPKs)—increased by 3.6% year-on-year, but fell from the 5.1% annual growth recorded in June.

“July’s performance marked a soft start to the peak passenger demand season,” said IATA Director General and CEO Alexandre de Juniac. 

“Tariffs, trade wars, and uncertainty over Brexit are contributing to a weaker demand environment than we saw in 2018. At the same time the trend of moderate capacity increases is helping to achieve record load factors.”

July’s performance marked a soft start to the peak passenger demand season

Capacity—measured in available seat kilometers (ASKs)—rose 3.2% in July compared to the same month in 2018, while load factor increased to 85.7%, a record high for any month.

In the international markets, overall passenger demand grew by 2.7% year-on-year, which was a deceleration compared to the 5.3% growth recorded in June. 

Capacity climbed 2.4%, and load factor edged upward to 85.3%. All regions reported growth, led by Latin American airlines.

China led the way in the domestic markets, recording an 11.7% growth in passenger demand. This is aided by lower fares and more connections.

Domestic travel demand outperformed international growth in July, as RPKs rose 5.2%, up from 4.7% growth in June. Domestic capacity climbed 4.7%, and load factor increased by 0.4 percentage point to 86.5%.

See the breakdown by international region below:

  • Asia-Pacific airlines’ July traffic rose 2.7% over the year-ago period, a slowdown compared to June growth of 3.9% and their weakest performance since early 2013. Capacity increased 2.4% and load factor rose 0.2 percentage point to 82.6%.
  • European carriers registered a modest 3.3% annual growth in July, down from a 5.6% year-over-year increase in June. Capacity rose 3.2%, and load factor climbed 0.1 percentage point to 89.0%, highest among the regions. 
  • Middle East carriers had a 1.6% increase in demand for July, well down on the 8.3% growth recorded for June, after the end of Ramadan. July capacity climbed 1.0% compared to a year ago and load factor rose 0.4 percentage point to 81.3%.
  • North American airlines’ traffic climbed 1.5% compared to July a year ago, down from 3.5% growth in June. July capacity rose 0.7% with the result that load factor climbed 0.7 percentage point to 87.9%, second highest among the regions.
  • Latin American airlines experienced a 4.1% rise in traffic in July, which was the strongest growth among the regions but a decline from 5.8% year-over-year growth in June. Capacity rose 2.7% and load factor climbed 1.1 percentage points to 85.6%.
  • African airlines’ July traffic rose 3.6%, a significant decline from 9.8% growth recorded in June. Capacity rose 6.1%, and load factor slipped 1.7 percentage points to 72.9%.
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