Airfreight growth lags behind passenger success

Joy orlek FIRST QUARTER growth in airfreight traffic registered a disappointing 4.2% compared to an impressive 9.4% passenger growth. From page 1 “While it is too early to identify a slowing trend in freight traffic, we need to watch this development closely over the coming months,” said Giovanni Bisignani, director general and CEO of the International Air Transport Association. Referring to the passenger growth figures, he said carriers were successfully increasing fleet utilisation. “This is particularly true in North America where March load factors topped 81.1%. Nonetheless, with oil in the US$50 per barrel (Brent) range we are a long way from profitability.” Capacity expansion in all regions for the first quarter was below traffic growth, pushing load factors higher. “However you look at it, 2005 is shaping up to be another difficult year for the airlines. Intensified cost cutting and better aircraft utilisation are steps in the right direction. But they cannot keep pace with the increases in the industry’s fuel bill. From 2003 to 2004 the industry fuel bill rose by US$19 billion from US$44 billion to US$63 billion. At an average fuel bill of US$43 per barrel (Brent), the fuel bill for 2005 will exceed US$76 billion—and even that seems conservative given today’s prices. Fundamental and large-scale change is absolutely critical,” said Bisignani. The agenda for change will form the basis of discussions at the World Air Transport Summit and 61st IATA annual general meeting to be held in Tokyo on May 29-31.