Asia Pacific Airlines Traffic Results – June 2012

Kuala Lumpur, Malaysia – Preliminary traffic figures for the month of June released today by the Association of Asia Pacific Airlines (AAPA) showed further steady growth in international passenger demand, but international air freight markets remained weak.

In the month of June, Asia Pacific airlines carried 17.0 million international passengers, an increase of 8.5% compared to the same month last year. In revenue passenger kilometre (RPK) terms, international passenger traffic grew by 8.1%, outpacing the 4.3 % expansion in available seat capacity, resulting in a 2.8 percentage point increase in the average international passenger load factor to 80.2% for the month.

International air cargo demand, expressed in freight tonne kilometre (FTK) terms, was 0.8% lower in June compared to the same month last year, reflecting continued weakness in global trade conditions. Offered freight capacity declined by 1.4%, leading to a 0.4 percentage point increase in the average international air cargo load factor to 67.8%.

Commenting on the results, Mr. Andrew Herdman, AAPA Director General said, “For the first half of 2012, Asia Pacific airlines recorded an encouraging 8.7% increase in the number of international passengers carried, supported by relatively strong regional markets, despite wider concerns about weaker prospects for the global economy."

Mr. Herdman added, “On the other hand, air cargo markets remained depressed, with Asian airlines’ international air cargo traffic, measured in FTK terms, down by 4.3% for the first six months of the year, reflecting weak consumer confidence in major developed markets.”

Mr. Herdman concluded, “Although passenger demand has held up well, weak air cargo demand has undermined overall revenue growth, whilst cost pressures from high fuel prices squeezed already thin margins. Oil prices have moderated from their recent highs, providing a measure of relief, but prospects for the second half of the year are still overshadowed by continuing uncertainty over the weak global economic outlook. Asian airlines are therefore taking a relatively cautious view with regard to capacity management, and carefully managing costs throughout the business.”