Airlines firmly in the red: IATA

Global - International air cargo traffic may have recovered slightly in September, but the industry remains firmly in the red, says director general and CEO IATA Giovanni Bisignani.

International air cargo traffic fell 5.4% in September compared to a year earlier, but rose 12% from its December 2008 low point, the International Air Transport Association (IATA) said.

IATA said cargo load factor has also returned to pre-crisis level of 50.8%, which should help to correct the "precipitous" 20% decline in yields.

Asia-Pacific carriers recorded improvements over August performance, but remained in negative territory at -3.1%.

The Geneva based trade body warned however that the apparent year-on-year improvement in demand could be misleading as it is based on an exceptionally weak September 2008 when traffic fell by 7.7%.

Seasonally adjusted statistics show a 0.3% drop in passenger volumes and a 1.4% fall in cargo volumes for September 2009 compared with August 2009. This reflects the pause seen in the economic recovery in the US and elsewhere in the past few months, IATA said.

"It is far too early to call this a recovery. The worst may be over in terms of the fall in demand, but yields continue to be a disaster and costs are rising. The airline industry remains firmly in the red with a fragile business environment," said Giovanni Bisignani, director general and CEO at IATA.

Although cargo traffic is 12% above the December 2008 low point, it still remains 17% below the early 2008 peak.

IATA said airlines should continue to cautiously manage cargo capacity which has improved only slightly in the last two months. In addition, rising costs are a concern as airlines adjust capacity to match demand by flying fewer hours. Oil prices have also risen to above US$75 per barrel (Brent) from US$43 per barrel at the start of the year.

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