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08 August 2023  No: 50

Geneva – The International Air Transport Association (IATA) announced that the post-COVID recovery momentum continued in June for passenger markets.

•             Total traffic in June 2023 (measured in revenue passenger kilometers or RPKs) rose 31.0% compared to June 2022. Globally, traffic is now at 94.2% of pre-COVID levels. For the first half of 2023, total traffic was up 47.2% compared to the year-ago period.

•             Domestic traffic for June rose 27.2% compared to the same month a year ago and was 5.1% above the June 2019 results. Domestic demand was up 33.3% in the 2023 first half compared to a year ago.

•             International traffic climbed 33.7% versus June 2022 with all markets showing robust growth. International RPKs reached 88.2% of June 2019 levels. First half 2023 international traffic was up 58.6% over the first half of 2022.

“The northern summer travel season got off to a strong start in June with double-digit demand growth and average load factors topping 84%. Planes are full which is good news for airlines, local economies, and travel and tourism dependent jobs. All benefit from the industry’s ongoing recovery,” said Willie Walsh, IATA’s Director General.

June 2023 (% year-on-year)        World share1     RPK        ASK        PLF (%-pt)2         PLF (level)3

Total Market      100.0%  31.0%    28.8%    1.4%      84.2%

Africa    2.1%      31.8%    40.5%    -4.6%     68.9%

Asia Pacific          22.1%    90.1%    73.3%    7.1%      80.4%

Europe 30.8%    13.0%    11.5%    1.2%      87.7%

Latin America     6.4%      18.7%    17.1%    1.1%      82.5%

Middle East        9.8%      28.3%    24.5%    2.4%      79.4%

North America  28.8%    12.9%    13.8%    -0.7%     88.7%

1% of industry RPKs in 2022   2year-on-year change in load factor   3Load Factor Level

 International Passenger Markets

•             Asia-Pacific airlines had a 128.1% increase in June 2023 traffic compared to June 2022, easily the largest percentage gain among the regions. Capacity climbed 115.6% and the load factor increased by 4.6 percentage points to 82.9%.

•             European carriers posted a 14.0% traffic rise versus June 2022. Capacity rose 12.6%, and load factor climbed 1.1 percentage points to 87.8%, which was the second highest among the regions.

•             Middle Eastern airlines’ June traffic climbed 29.2% compared to June last year. Capacity rose 25.9% and load factor improved 2.0 percentage points to 79.8%.

•             North American carriers saw traffic climb 23.3% in June 2023 versus the 2022 period. Capacity increased 19.5%, and load factor rose 2.7 percentage points to 90.2%, which was the highest among the regions.

•             Latin American airlines had a 25.8% traffic increase compared to the same month in 2022. June capacity climbed 25.0% and load factor rose 0.6 percentage points to 84.8%.

•             African airlines’ traffic rose 34.7% in June 2023 versus a year ago, the second highest percentage gain among the regions. June capacity was up 44.8% and load factor fell 5.1 percentage points to 68.1%, lowest among the regions. Africa was the only region to see a decline in the monthly international load factor compared to the year ago period.

Domestic Passenger Markets

June 2023 (% year-on-year)        World share1  

RPK        ASK        PLF (%-pt)2         PLF (Level)3

Domestic             42.0%    27.2%    24.7%    1.6%      82.9%

Australia              1.0%      -1.7%     1.7%      -2.8%     79.4%

Brazil     1.5%      13.3%    8.2%      3.5%      78.9%

China P.R.            6.4%      129.6%  95.7%    11.4%    77.2%

India      2.0%      14.8%    0.8%      10.9%    89.9%

Japan    1.2%      33.8%    6.3%      15.1%    73.4%

US          19.2%    8.0%      11.2%    -2.6%     87.8%

1% of industry RPKs in 2022   2year-on-year change in load factor 3Load Factor Level

•             Australia’s domestic traffic slipped 1.7% in June compared to a year ago. It was the only domestic market to see a year-over-year traffic decline in June, although traffic remained 3.9% above pre-pandemic levels.                                                                                                                                                                                 

•             Indian airlines’ domestic demand climbed 14.8% in June and was 1.3% above the June 2019 level.                                                         

June 2023 (% ch vs the same month in 2019)       World share1     RPK        ASK        PLF (%-pt)2         PLF (level)3

Total Market      100.0%  -5.8%     -5.5%     -0.2%     84.2%

International      58.0%    -11.8%  -13.2%  1.4%      85.0%

Domestic             42.0%    5.1%      8.7%      -2.8%     82.9%

The Bottom Line

“As strong as travel demand has been, arguably it could be even stronger. Demand is outrunning capacity growth. Well documented problems in the aviation supply chain mean that many airlines have not taken delivery of all the new, more environmentally friendly aircraft they had expected, while numerous aircraft are parked awaiting critical spare parts. And, for the fleet that is in service, some air navigation service providers (ANSPs) are failing to deliver the requisite capacity and resilience to meet travel demand. Delays and trimmed schedules are frustrating for both passengers and their airlines. Governments cannot continue to ignore the accountability of ANSPs in places where passenger rights regimes place the brunt of accountability on airlines,” said Walsh.

7 August 2023    No: 49

 (Geneva) – The International Air Transport Association (IATA) released data for June 2023 global air cargo markets showing the smallest year-over-year contraction in demand since February 2022.

•             Global demand, measured in cargo tonne-kilometers (CTKs), fell 3.4% in June compared to June 2022 (-3.7% for international operations). For the half year, demand slid 8.1% compared to the January-June period of 2022 (-8.7% for international operations). However, demand in June was only 2.4% below June 2019 levels (pre-pandemic).

•             Capacity, as measured by available cargo tonne-kilometers (ACTKs), rose 9.7% compared to June 2022, which was a slower rate compared to the double-digit growth recorded between March and May. This reflects strategic capacity adjustments airlines are making amid a weakened demand environment. Capacity for the first half of 2023 was up 9.9% compared to a year ago. Capacity is now 3.7% above June 2019 (pre-pandemic) levels.

•             Key factors influencing air cargo demand include:

o             Global cross-border trade decreased by 2.4% year-over-year in May, reflecting the cooling demand environment and challenging macroeconomic conditions. The difference between the annual growth rates of air cargo and the global goods trade narrowed to -2.6 percentage points in May, representing the smallest gap since January 2022. However, the gap still suggests that air cargo continues to suffer more than container cargo from the slowdown in global trade.

o             In June, both manufacturing output Purchasing Managers Index or PMI (49.2) and new export orders PMI (47.1) were below the critical threshold represented by the 50 mark, indicating a decline in global manufacturing production and exports.

“We remain hopeful that the difficult trading conditions for air cargo will moderate as inflation eases in major economies. This, in turn, could encourage the central banks to loosen the money supply, which could stimulate greater economic activity,” said Willie Walsh, IATA’s Director General.

 Air cargo market in detail – June 2023                                                                     

                World                    June 2023 (% year-on-year)

                share1                 CTK        ACTK     CLF (%-pt)2         CLF (level)3

TOTAL MARKET 100.0%                 -3.4%     9.7%      -5.8%     43.2%

   Africa 2.0%                     -2.8%     -3.7%     0.4%      44.6%

   Asia Pacific       32.4%                   -3.6%     24.4%    -13.6%  46.8%

   Europe              21.8%                   -2.8%     4.4%      -3.5%     47.6%

   Latin America  2.7%                     7.3%      15.4%    -2.5%     33.7%

   Middle East     13.0%                   0.5%      11.1%    -4.7%     44.6%

   North America               28.1%                   -6.5%     0.7%      -2.9%     37.4%

1% of industry CTKs in 2022                                        2Year-on-year change in load factor        3Load factor level

June Regional Performance

Asia-Pacific airlines saw their air cargo volumes decrease by 3.6% in June 2023 compared to the same month in 2022. This was also a decline compared to May (-2.5%), mainly owing to weak demand on within-Asia markets, although the Asia-North America trade lane saw improved performance. Available capacity in the region increased by 24.4% compared to June 2022. Looking at the first half of 2023, cargo demand was down 6.5% versus the year-ago period against a 27.0% rise in capacity.

North American carriers had a 6.5% decrease in total cargo volumes in June 2023 compared to the same month in 2022, marking the fourth consecutive month in which the region had the weakest performance. This was, however, an improvement compared to May (-8.6%). Europe-North America CTKs shrank by only 2.7% in June, following three months of double-digit contractions. Capacity increased 0.7% compared to June 2022. For the 2023 first half, cargo demand was down 10.5% compared to the 2022 first half, while capacity dipped 0.7%.

European carriers experienced a 2.8% decrease in cargo volumes in June 2023, compared to the same month in 2022. This was an improvement in performance compared to May (-6.6%), in part due to the aforementioned Europe-North America performance. Capacity increased 4.4% compared to June 2022. Cargo demand was down 10.2% for the first six months of 2023 compared to last year, as the half-year capacity rose 2.5%.

Middle Eastern carriers posted a 0.5% increase in cargo volumes in June 2023 versus a year ago. This was a strong turnaround from the 2.9% year-over-year decline registered in May. Capacity rose 11.1% for the month. Both Middle East-Asia and Middle East-Europe route areas saw annual growth. For the first half of the year, cargo demand was down 5.6% compared to a year ago, with an 11.2% hike in capacity.

Latin American carriers had strongest performance in June 2023, with a 7.3% increase in cargo volumes compared to June 2022. This was an improvement compared to May (+3.8%). Capacity in June was up 15.4% over the same month in 2022. For the 2023 first half, cargo demand was up 0.9% versus a year ago, while capacity climbed 18.0%.

African airlines posted a 2.8% decrease in demand compared to June 2022. This was a decline in performance compared to the previous month (-1.9%). Capacity in June was down 3.7% compared to the same month in 2022. For the first half of the year, cargo demand slowed by 4.4% while capacity climbed 1.6%.

Colombo – The International Air Transport Association (IATA) urged Sri Lanka to develop an aviation blueprint so as to generate greater economic growth and prosperity through having a stronger aviation industry.

“Aviation connectivity can play a much bigger role in Sri Lanka’s economic development and social advancement. But this will not happen by chance. Government support will be critical to growing a strong airline sector and developing Colombo as an aviation hub. We urge the government and all industry stakeholders to collaborate on developing an aviation blueprint to strengthen the aviation industry’s competitiveness and bring greater prosperity to Sri Lanka. And IATA stands ready to support through our expertise and sharing of industry best practices,” said Philip Goh, IATA’s Regional Vice President for Asia Pacific.

Aviation has a role to play in 15 of the 17 UN Sustainable Development Goals. Trade and tourism rely on aviation, and this helps to create jobs, alleviate poverty and generate prosperity. In a 2018 IATA study, Sri Lanka’s aviation sector supported some 700,000 jobs and contributed $8 billion to the GDP. This has the potential to increase to over 1 million jobs contributing nearly $30 billion to the GDP by 2038.

In his keynote remarks at Aviation Day Sri Lanka, organized by IATA and the Civil Aviation Authority of Sri Lanka (CAASL), Goh suggested three areas to consider in the aviation blueprint: facilitating sustainable growth, safety, and sustainability.

Facilitating Sustainable Growth: “Sri Lanka’s aviation blueprint needs to facilitate the sustainable growth of the industry and having an updated airport masterplan is the first step. I urge the government to engage in a consultative approach involving airlines to ensure that industry input is factored in,” said Goh,

Goh urged Sri Lanka to digitize processes for passenger and cargo facilitation. “Many of the country’s passenger and cargo processes continue to be paper based. As traffic grows, digitization will be key to address capacity constraints, increase efficiency and improve the travel experience. IATA’s One ID and One Record initiatives can help support this,” said Goh.

Goh also highlighted the need to keep costs low, in particular jet fuel. Airlines pay more for jet fuel in Sri Lanka than at other major airports in Asia. He recognized much has been done in recent months to lower the cost of jet fuel, and encouraged the government to review and consider placing limits or capping the amount that CEYPETCO can mark up for supplying fuel at the airport.

Safety: “It is important for Sri Lanka’s aviation sector to grow sustainably in a safe manner, and IATA is doing our part to support the country’s efforts. Utilizing the International Airlines Training Fund, IATA will support the aviation industry in Sri Lanka by conducting safety related training in August for CAASL and Sri Lankan Airlines,” said Goh.

Goh encouraged the government to explore how the IATA Operational Safety Audit (IOSA) and IATA Safety Audit for Ground Operations (ISAGO) can be used to contribute to greater aviation safety in Sri Lanka.

Sustainability: “I am delighted that net zero carbon from aviation by 2050 is one of the stated policy goals of Sri Lanka’s sustainable aviation environment policy, including the need to ensure the availability of sustainable aviation fuels (SAF) in the country,” said Goh. SAF is expected to abate more than 60% of aviation carbon emissions by 2050.

Goh called on the government to adopt a comprehensive consultation process involving airlines and other aviation stakeholders as the government develops sustainability policies.

July 7, 2023 by Payload Asia

A new partnership is expected to enhance Etihad Cargo’s capabilities in Europe as the airline tapped Wallenborg Transports and its road feeder service network of 90 airports in 27 countries.

The move is expected to facilitate the transport of cargo between Etihad Cargo’s main freighter gateways in Europe, including Amsterdam, Paris and Frankfurt, as well as offline stations.

The airline has entered into strategic partnerships with RFS providers around the globe to strengthen its value proposition through fast, efficient and reliable end-to-end cargo transport from arrival in-airport onto final destination.

Wallenborg said highlights of the partnership include dedicated capacity, 24/7 customer support and handling services in 27 countries. It will also offer specialised logistics solutions, such as GDP-validated transport for temperature-sensitive healthcare products.

Other Topics: Air Cargo Network, Air Express, Air Freight Services, Air Logistics, Asia Pacific Air Cargo, Asia Pacific Air Freight, Asia Pacific Air Logistics, Asia Pacific Shipments, Cargo Flights, E-Commerce Logistics, Etihad Cargo, Express Delivery, Express Logistics, International Air Shipments, International Express Delivery, Transpacific Air Cargo, Transpacific Air Freight.

Geneva – The International Air Transport Association (IATA) and the Aviation Impact Accelerator (AIA), an international industry-academia partnership based at the University of Cambridge, announced a collaboration to accelerate the aviation sector’s transition to net-zero CO2 emissions by 2050.

The two organizations will assess the financial implications of reaching aviation’s 2050 net-zero CO2 goal. Building upon existing work, this collaboration will support the development of scenario-based tools to help airlines analyze and evaluate different decarbonization pathways.

The purpose of this collaboration is to support better-informed decisions by airlines and policy-makers in the transition to net zero. The collaboration will set a solid foundation for IATA and AIA to develop a wider, long-term partnership.

AIA is an international group of experts drawing on a broad range of expertise convened by the University of Cambridge. Its aim is to accelerate the journey to sustainable aviation by developing evidence-based tools that allow people to understand, map, and embark on the pathways towards sustainable flight. Over the last three years a world class network of experts has been assembled and the underlying system modelling capability developed.

“We are excited to launch this new collaboration between AIA and IATA, investigating realistic pathways for aviation’s transition to net zero emissions by 2050. IATA has a strong track record of fostering cooperation between airlines and other stakeholders and driving change in the sector. We believe that by bringing this together with AIA’s unique modelling capability we have an opportunity to unlock change,” said Prof. Rob Miller, Director of the Whittle Laboratory, University of Cambridge, and AIA lead.

“We are delighted to join forces with the Aviation Impact Accelerator with a view to enhance our understanding of the many potential pathways to achieve air transport’s sustainable future. The development of different technological pathways will have an influence on the long-term outlook of our industry, and our collaboration will notably explore this intersection,” said Marie Owens Thomsen, IATA’s Senior Vice President Sustainability and Chief Economist.

As part of the future collaboration, AIA and IATA also aim to collaborate on the future development of IATA’s Recommended Practice Per-Passenger CO2 Calculation Methodology, amongst other areas of work. Used in combination with verified airline operational data, the methodology provides the most accurate calculation results and transparency to everyone interested in understanding the carbon footprint from flying activity.

Indian express logistics company DTDC Express unveiled its new ‘super hub’ at Geethanjali Industrial Park, Velappanchavadi in Chennai on 28 June.

The new facility spans over 175,000 square feet and has 38 docks to help optimize cross-docking efficiency. The hub is equipped with infrastructure to handle and process over 350 tonnes of shipments daily.

The facility is equipped with a state-of-the-art sortation system that can process up to 9,000 parcels per hour. Located along the Chennai-Poonamallee-Bangalore highway, the new hub will offer seamless connectivity to urban centers in South India. It will also serve as a link to Ahmedabad, Delhi, Mumbai, and Kolkata.

“Chennai is a crucial logistics hub in Southern India, and we recognize its immense potential. By opening our super hub at Velappanchavadi, we are poised to streamline and strengthen our operations in the region and provide even more efficient and reliable logistics solutions to our valued customers across our express parcels, international and e-commerce verticals, further solidifying DTDC’s position as a leading player in the industry,” said Subhashish Chakraborty, chairman and managing director of DTDC Express.

Other Topics: Air Cargo Network, Air Express, Air Freight Services, Air Logistics, Asia Pacific Air Cargo, Asia Pacific Air Freight, Asia Pacific Air Logistics, Asia Pacific Shipments, Cargo Flights, E-Commerce Logistics, Express Delivery, Express Logistics, International Air Shipments, International Express Delivery, Transpacific Air Cargo, Transpacific Air Freight

Here is the second of three questions CargoForwarder Global put to ChatGPT this week (see also “What would a world without air cargo look like?” and “Is the future of air cargo electric?”). Given that it is fed with data until SEP21, in other words pre-Russian invasion, the answers are perhaps more generic than they might have been were it up-to-date. That said, the time period includes pandemic knowledge, yet does not mention pandemic as a risk until you push it for more information.

Do you agree with ChatGPT? Or has it failed to consider certain points? Image: Canva/CFG

Do you agree with ChatGPT? Or has it failed to consider certain points? Image: Canva/CFG

Here is ChatGPT’s answer to the prompt: “What is the biggest threat to air cargo?”

Several factors can be considered as potential threats to the air cargo industry. Here are some of the significant challenges that the industry faces:

Economic downturns: Economic recessions or downturns can significantly impact global trade and consumer demand, leading to a decrease in air cargo volumes. Reduced business activity and consumer spending can result in lower demand for goods, which directly affects the need for air cargo transportation.

Tensions and threats

Global trade tensions and protectionism: Increasing trade tensions, trade wars, and the implementation of protectionist measures by countries can disrupt supply chains and affect international trade flows. Tariffs, trade barriers, and geopolitical disputes can lead to decreased trade volumes and uncertainty, impacting the demand for air cargo services.

Security threats: The air cargo industry faces ongoing security concerns related to the transportation of goods. Risks include terrorism, smuggling of illegal substances, and theft. Implementing stringent security measures and ensuring compliance with international regulations is essential to mitigate these threats and maintain the integrity of air cargo operations.

Volatility and sustainability

Volatility in fuel prices: The cost of aviation fuel is a significant expense for air cargo carriers. Fluctuations in fuel prices can impact profitability and operational costs for the industry. Sharp increases in fuel prices can lead to higher transportation costs, potentially reducing demand for air cargo services or causing carriers to pass on the increased costs to customers.

Environmental sustainability: The aviation industry, including air cargo, faces growing pressure to reduce its environmental impact and carbon emissions. The carbon footprint of air cargo operations and the reliance on fossil fuels for aircraft create sustainability challenges. Regulatory changes, such as emissions trading schemes and environmental regulations, may impact the industry’s operations and require investments in more fuel-efficient aircraft and sustainable practices.

Technology and infrastructure

Technological disruptions: Rapid advancements in technology, such as 3D printing and digital supply chain solutions, have the potential to disrupt traditional manufacturing and logistics models. These advancements could potentially reduce the need for certain types of air cargo transportation if goods can be produced locally or delivered through alternative means.

Infrastructure limitations: Inadequate airport infrastructure, limited cargo handling capabilities, and congestion at airports can hamper the efficiency of air cargo operations. Insufficient infrastructure can result in delays, increased costs, and reduced capacity for cargo transportation.

It’s important to note that the air cargo industry is dynamic and resilient, and stakeholders continually work to address these challenges through innovation, collaboration, and adaptation to changing market conditions.

ChatGPT’s more indepth interview

Interesting that it mentions 3D printing which still appears to be very much a future threat, but one that I have long considered. On the other hand, it also does not explicitly mention the term near-shoring, which could be a more imminent threat.

When probed for more information on the war in Ukraine, it reminds you that its last knowledge update was in SEP21. Nevertheless, it points to four key impact areas on air cargo (in more detail than outlined here): Disruption of air transport infrastructure, increased operational risks to air cargo leading to delays or suspension of services, trade disruptions, and geopolitical factors hampering air cargo flows both within Ukraine but also in the broader region.

Regarding the pandemic, it confirms that this “had a significant impact on the air cargo industry, both positive and negative, presenting both challenges and opportunities,” and detailed six key areas illustrating both sides. It underlined the resilience of the air cargo industry with words that could have been uttered by TIACA’s Glyn Hughes or IATA’s Willy Walsh: “Despite the challenges, the pandemic showcased the resilience and adaptability of the air cargo industry. The industry responded quickly to changing demands, utilized technology for efficient operations, and demonstrated its critical role in supporting global supply chains during a crisis,” and concluded: “It’s worth noting that the impact of the pandemic on air cargo has evolved over time and varies in different regions. The industry continues to navigate the challenges presented by the pandemic while exploring opportunities for growth and improvement.”

Geneva – The International Air Transport Association (IATA) will publish an annual Track Zero report using IATA’s Net Zero Tracking Methodology to report industry-level progress towards aviation’s commitment to Net Zero carbon emissions by 2050.

The Net Zero Tracking Methodology and related reporting process were developed with industry experts. IATA will aggregate and report annually inputs from IATA member airlines on an industry basis. After thorough validation, aggregate industry data from the previous calendar year will be reported annually in the fourth quarter of each year. The first report with airline-contributed data is planned for publication in Q4 2024. Non-IATA member airlines are also encouraged to contribute data and participate in the reporting.

“Transparency is a critical element of aviation’s decarbonization. We will report our progress annually to ensure standardized, accurate and comprehensive reporting of aviation’s journey to net zero. Industry-level data in the Track Zero report will help airlines, governments, and investors with tools to improve decision-making to accelerate progress,” said Marie Owens Thomsen, IATA’s Senior Vice President Sustainability and Chief Economist.

Individual airlines may use the aggregate data of the Track Zero report to benchmark their own progress towards decarbonization. They may also choose to report their progress on decarbonization to key stakeholders including governments, investors and customers, using IATA’s Net Zero Tracking Methodology.

“Decarbonization is an industry challenge, not a competitive issue. Nonetheless, the report and the methodology behind it can enable benchmarking that could intensify decarbonization efforts by spreading the success of best practices and sparking innovation,” said Owens Thomsen.

Key features of the Net Zero Tracking Methodology include:

Standardization: The methodology establishes a transparent framework for accurate reporting that can be used industry-wide by identifying the relevant emissions scope, sources, and processes for emissions tracking and measurement.

Accuracy: The methodology includes best practices for data collection and validation with minimal administrative burden.

Comprehensiveness: The methodology accommodates reporting of all manner of decarbonization activities on a lifecycle basis, including usage of conventional and sustainable aviation fuel (SAF), carbon offsets/carbon capture, and future power sources (hybrid-electric, electric, and hydrogen-powered aircraft).

The decision to publish a Track Zero report follows the release by IATA of five roadmaps detailing critical actions for aviation to achieve net zero CO2 by 2050. They address aircraft technology, energy infrastructure, operations, finance, and policy. Together, they show a clear direction and will evolve with the insights of the Track Zero report, practical experience and emerging technologies to help aviation set interim milestones on the way to net zero.

Geneva – The International Air Transport Association (IATA) released May 2023 traffic data showing continued strong growth in air travel demand.

•             Total traffic in May 2023 (measured in revenue passenger kilometers or RPKs) rose 39.1% compared to May 2022. Globally, traffic is now at 96.1% of May 2019 (pre-pandemic) levels.

•             Domestic traffic for May rose 36.4% compared to the year-ago period. Total May 2023 domestic traffic was 5.3% above the May 2019 level. This is the second month in a row domestic traffic has exceeded pre-pandemic levels.

 •            International traffic climbed 40.9% versus May 2022 with all markets recording strong growth, led once again by carriers in the Asia-Pacific region. International RPKs reached 90.8% of May 2019 levels, with Middle East and North American airlines exceeding pre-pandemic levels.

 •            The total industry load factor rose to 81.8%, led by North American carriers at 86.3%.

“We saw more good news in May. Planes were full, with the average load factors reaching 81.8%. Domestic markets reported growth on pre-pandemic levels. And, heading into the busy Northern summer travel season, international demand reached 90.8% of pre-pandemic levels,” said Willie Walsh, IATA’s Director General.

May 2023 (% year-on-year)         World share1     RPK        ASK        PLF (%-pt)2         PLF (level)3

Total Market      100.0%  39.1%    35.0%    2.4%      81.8%

Africa    2.1%      38.6%    36.7%    0.9%      69.9%

Asia Pacific          22.1%    130.4%  109.5%  7.0%      77.3%

Europe 30.8%    19.1%    13.5%    4.0%      84.8%

Latin America     6.4%      16.2%    16.5%    -0.2%     81.1%

Middle East        9.8%      30.1%    23.8%    3.9%      79.9%

North America  28.8%    14.0%    13.6%    0.3%      86.3%

1% of industry RPKs in 2022   2year-on-year change in load factor   3Load Factor Level

 International Passenger Markets

•             Asia-Pacific airlines had a 156.7% increase in May 2023 traffic compared to May 2022, maintaining the very positive momentum since the lifting of the remaining travel restrictions in the region earlier this year. Capacity rose 136.1% and the load factor increased 6.4 percentage points to 80.0%.

•             European carriers posted a 19.8% traffic rise versus May 2022. Capacity climbed 14.2%, and the load factor rose 3.9 percentage points to 84.4%.

 •            Middle Eastern airlines saw a 30.8% traffic increase compared to May a year ago. Capacity climbed 25.0% and the load factor pushed up 3.6 percentage points to 80.2%. The region is leading the recovery with May traffic at 17.2% above 2019 levels.

 •            North American carriers’ traffic climbed 31.0% in May 2023 versus the 2022 period. Capacity increased 23.2%, and the load factor rose 5.1 percentage points to 85.1%, highest among the regions.

•             Latin American airlines had a 26.3% traffic increase compared to the same month in 2022. May capacity climbed faster– up 27.3% — and the load factor slipped 0.7 percentage points to 83.8%. The region was the only one to see capacity growth exceed traffic growth for the month.

 •            African airlines’ traffic rose 45.2% in May 2023 versus a year ago. May capacity was up 44.2% and the load factor edged up 0.5 percentage points to 68.8%, the lowest among the regions.

Domestic Passenger Markets

May 2023 (% year-on-year)         World share1  

RPK        ASK        PLF (%-pt)2         PLF (Level)3

Domestic             42.0%    36.4%    35.3%    0.6%      81.0%

Australia              1.0%      2.1%      3.4%      -0.9%     73.6%

Brazil     1.5%      8.6%      6.2%      1.7%      76.5%

China P.R.            6.4%      312.0%  233.1%  13.9%    72.8%

India      2.0%      13.6%    2.7%      8.7%      91.6%

Japan    1.2%      39.0%    7.1%      16.9%    73.8%

US          19.2%    7.1%      9.6%      -2.0%     86.9%

1% of industry RPKs in 2022   2year-on-year change in load factor 3Load Factor Level

•             Brazil’s domestic traffic grew 8.6% in May compared to a year ago, and is the latest domestic market to recover fully with traffic at 6.5% above pre-pandemic (May 2019) levels.

•             Japan’s domestic traffic surged 39.0% in May compared to a year ago, the strongest result after China and at 99.8% of pre-pandemic levels.

May 2023 (% ch vs the same month in 2019)        World share1     RPK        ASK        PLF (%-pt)2         PLF (level)3

Total Market      100.0%  -3.9%     -3.9%     0.0%      81.8%

International      58.0%    -9.2%     -11.2%  1.8%      82.3%

Domestic             42.0%    5.3%      9.4%      -3.1%     81.0%

The Bottom Line

“People need and love to fly. The strong demand for travel is one element supporting a return to profitability by airlines.  In 2023 we expect airlines globally to post a $9.8 billion net profit. It’s an impressive number, particularly after huge pandemic losses. But a 1.2% average net profit margin is just $2.25 per departing passenger. As a return, that is not sustainable in the long-term.

Moreover, it appears that, while the pandemic has changed many things in aviation, it has not righted aviation’s famously unbalanced value chain. The latest indication came last week as European airports announced a EUR 6.4 billion ($7 billion) collective profit in 2022. In comparison, IATA estimates that European airlines made a $4.1 billion profit for the same year. We don’t begrudge any business hard-earned profits. But this does raise an interesting question. Is airport economic regulation effectively defending the public interest when a monopoly supplier (airports) can generate seemingly much healthier returns than the competitive businesses (airlines) they supply? Governments should at least take a look,” said Walsh.

Geneva – The International Air Transport Association (IATA) released data for May 2023 global air cargo markets showing weak market conditions.

•             Global demand, measured in cargo tonne-kilometers (CTKs), fell 5.2% compared to May 2022 (-6.0% for international operations).

•             Capacity, as measured by available cargo tonne-kilometers (ACTKs), rose 14.5% compared to May 2022, primarily driven by belly capacity which increases as demand in the passenger business recovers. Capacity is now 5.9% above May 2019 (pre-pandemic) levels.

•             Key factors influencing demand include:

o             The global manufacturing Purchasing Managers Index (PMI) indicates an annual contraction of 1.4% in new export orders and a decrease of 5.2% year-on-year in production PMI. This suggests a cooling in global manufacturing demand.

Global goods trade decreased by 0.8% in April, due to macroeconomic challenges and supply chain constraints. Trading conditions appeared to favor maritime cargo as demand for container shipping contracted by 0.2% while air cargo demand weakened by 6.3% year-on-year.

o             The global supplier delivery time PMI increased to 54.5 in May, up from its low of 35 in October 2021, indicating shorter delivery times and some relief for supply chains. However, this is also a sign of weaker global goods trade demand.

“Trading conditions for air cargo continue to be challenging with a 5.2% fall in demand and several economic indicators pointing towards weakness. The second half of the year, however, should bring some improvements. As inflation moderates in many markets, it is widely expected that central bank rate hikes will taper. This should help stimulate economic activity with a positive impact on demand for air cargo,” said Willie Walsh, IATA’s Director General.

May (% year-on-year)   World share1     CTK        ACTK     CLF (%-pt)2         CLF (level)3

Total Market      100.0%  -5.2%     14.5%    -8.6%     41.5%

Africa    2.0%      -2.4%     9.2%      -5.3%     44.8%

Asia Pacific          32.4%    -3.3%     38.3%    -18.2%  42.2%

Europe 21.8%    -6.7%     5.6%      -6.4%     48.9%

Latin America     2.7%      3.6%      14.7%    -3.6%     33.3%

Middle East        13.0%    -3.1%     15.6%    -7.9%     41.0%

North America  28.1%    -8.1%     1.2%      -3.8%     37.3%

1 % of industry CTKs in 2022  2 Change in load factor  3 Load factor level

May Regional Performance

•             Asia-Pacific airlines saw their air cargo volumes decrease by 3.3% in May 2023 compared to the same month in 2022. This was a decrease in performance compared to April (-0.3%), mainly due to the stronger annual contraction in international air cargo demand from -3.5% in April to -6.4% this month. Available capacity in the region increased by 38.3% compared to May 2022 as more belly capacity came online from the passenger side of the business.

•             North American carriers saw the weakest performance of all regions for the third consecutive month with an 8.1% decrease in cargo volumes in May 2023 compared to the same month in 2022. This was a slight improvement in performance compared to April (-12.4%).  Notably, airlines in the region saw the third month of double-digit contractions in volumes on the North America-Europe trade lane (-10.3%). Capacity increased 1.2% compared to May 2022.

•             European carriers experienced a 6.7% decrease in cargo volumes in May 2023, compared to the same month in 2022. This was an improvement in performance compared to April (-7.7%), in part due to the smaller annual contraction in international CTKs on the Europe-Middle East trade lane, from -4.7% in April to -2.9% in May. The decline in international cargo traffic on markets within-Europe also improved from -16.2% in April to -7.8% this month (seasonally adjusted). Meanwhile, capacity increased 5.6% in May 2023 compared to May 2022. 

•             Middle Eastern carriers experienced a 3.1% year-on-year decrease in cargo volumes in May 2023. This was a slight improvement in performance compared to the previous month (-6.7%). Capacity increased 15.6% compared to May 2022.

•             Latin American carriers had the only positive performance in May 2023 posting a 3.6% increase in cargo volumes compared to May 2022. This was an improvement in performance compared to April (-1.6%). Capacity in May was up 14.7% compared to the same month in 2022. 

•             African airlines posted a 2.4% decrease in demand compared to May 2022. This was a decline in performance compared to the previous month (-0.9%). Notably, the growth on the Africa to Asia trade route slowed significantly in May from 18.5% in April to 11.0%, possibly due to the impact of the conflict in Sudan since mid-April. Capacity in May was up 9.2% compared to the same month in 2022.