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Sluggish improvement in air passenger demand continues in July

The International Air Transport Association (IATA) announced that passenger demand in July (measured in revenue passenger kilometers or RPKs), continued at critically low levels–79.8 percent below July 2019 levels.

This was somewhat better than the 86.6 percent year-over-year decline recorded in June, primarily driven by domestic markets, most notably Russia and China. Market reopening in the Schengen Area helped to boost international demand in Europe, but other international markets showed little change from June. Capacity was 70.1 percent below 2019 levels and load factor sagged to a record low for July, at 57.9 percent.

“The crisis in demand continued with little respite in July. With essentially four in five air travellers staying home, the industry remains largely paralyzed. Governments reopening and then closing borders or removing and then re-imposing quarantines does not give many consumers confidence to make travel plans, nor airlines to rebuild schedules,” Alexandre de Juniac, IATA’s Director General and CEO said.

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July international passenger demand collapsed 91.9 percent compared to July 2019, a slight improvement over the 96.8 percent decline recorded in June. Capacity plummeted 85.2 percent, and load factor sank 38.9 percentage points to 46.4 percent.

European carriers’ July demand toppled 87.1 percent compared to last year, improved from a 96.7 percent drop in June, year-over-year, reflecting relaxation of travel restrictions in the Schengen Area. Capacity dropped 79.2 percent and load factor fell by 33.8 percentage points to 55.1 percent.

Asia-Pacific airlines’ July traffic dived 96.5 percent compared to the year-ago period, virtually unchanged from a 97.1 percent drop in June, and the steepest contraction among regions. Capacity fell 91.7 percent and load factor shrank 47.3 percentage points to 35.3 percent.

Middle Eastern airlines posted a 93.3 percent traffic decline for July, compared with a 96.1 percent demand drop in June. Capacity tumbled 85.6 percent, and load factor sank 43.4 percentage points to 38.0 percent.

North American carriers saw a 94.5 percent traffic decline in July, a slight uptick from a 97.1 percent decline in June. Capacity fell 86.1 percent, and load factor dropped 53.0 percentage points to 35.0 percent, second lowest among regions.

Latin American airlines experienced a 95.0 percent demand drop in July, compared to the same month last year, versus a 96.6 percent drop in June. Capacity fell 92.6 percent and load factor sank 27.1 percentage points to 58.4 percent, highest among the regions.

African airlines’ traffic dropped 94.6 percent in July, somewhat improved from a 97.8 percent contraction in June. Capacity contracted 84.6 percent, and load factor fell 47.1 percentage points to 25.4 percent, which was the lowest among regions.

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