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Global Airline Traffic Slows in August

The International Air Transport Association (IATA) just released international air traffic numbers for August, and the results were not good. Growth is slowing significantly, and this is all happening during the busy northern summer season.

Overall, traffic (as measured by revenue passenger kilometers) grew by 1.3% in August. That's down from 1.9% in July and a much stronger 5.4% for the first half of the year. Once again, the Middle East buoyed the number with 4.3% growth. That would seem strong except that it was 5.3% in July and 10.6% for the first half of 2008. Asian traffic was actually down 3.1%, but part of that could have been due to traffic pattern changes due to the Olympics. Were there any bright spots? Sure.

It may surprise you to know that North American carriers saw international traffic grow at 5.2%, up a full point from July. This undoubtedly comes from growth in the number of seats out there as US airlines have continued to flee to the international world from the domestic market. The bad news? Available seat kilometers were up 5.3%, and that points to a decrease in load factor which was the case worldwide with the small exception of Latin America.

Overall, load factor was down from 81% to 79.2% year over year, so there are still too many seats out there. What should airlines be doing? Well, cuts in international service have to be looked at as economies soften around the globe, and I know some airlines have already been proactive as we move into the lighter fall travel season. But as airlines put together their summer schedules for next year, they'll need to make some guesses as to where the economy will be by then. It will likely continue to be tough, considering what we've been seeing lately.

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