Demand growth hit high oil prices

(Geneva) - The International Air Transport Association (IATA) announced global traffic results for March showing that total passenger demand rose 7.6 percent and freight demand climbed 0.3 percent compared to the same month last year.

Comparisons with March last year are affected by events that depressed passenger demand in 2011, including the Arab Spring, which disrupted travel in the Middle East and North Africa beginning in February 2011 and the earthquake and tsunami in Japan in March 2011 that impacted air travel across the Asia-Pacific region. IATA estimates that the year-on-year rise in air travel in March was about two percentage points higher than it would otherwise have been in the absence of these events.

Cargo demand, meanwhile, was affected by the timing of the Chinese New Year, which occurred in January this year, leading to stronger February shipments in February 2011 leading to stronger March 2011 shipments and weaker year-to-year comparisons. Compared to February 2012, the March air cargo demand was significantly stronger by 2.2 percent.

If we discount the industry's growth by two percentage points as a result of the extraordinary events in 2011, airlines still managed an expansion in the range of 5-6 percent. Given the prevailing economic conditions with some European states returning to recession, passenger demand is holding up well. But this bringings little relief to the bottom line because yields are not keeping pace with the continued very high oil prices said, IATA Director General and CEO,Tony Tyler .