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Governments’ response to Delta variant slams August domestic air traffic demand

The International Air Transport Association (IATA) announced that the recovery in air travel decelerated in August compared to July, as government actions in response to concerns over the COVID-19 Delta variant cut deeply into domestic travel demand.

Because comparisons between 2021 and 2020 monthly results are distorted by the extraordinary impact of COVID-19, unless otherwise noted all comparisons are to July 2019, which followed a normal demand pattern.

Total demand for air travel in August 2021 (measured in revenue passenger kilometers or RPKs) was down 56.0 percent compared to August 2019. This marked a slowdown from July, when demand was 53.0 percent below July 2019 levels.

This was entirely driven by domestic markets, which were down 32.2 percent compared to August 2019, a major deterioration from July 2021, when traffic was down 16.1 percent versus two years ago. The worst impact was in China, while India and Russia were the only large markets to show a month-to-month improvement compared to July 2021.

International passenger demand in August was 68.8 percent below August 2019, which was an improvement compared to the 73.1 percent decline recorded in July. All regions showed improvement, which was attributable to growing vaccination rates and less stringent international travel restrictions in some regions.

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“August results reflect the impact of concerns over the Delta variant on domestic travel, even as international travel continued at a snail’s pace toward a full recovery that cannot happen until governments restore the freedom to travel.

In that regard, the recent US announcement to lift travel restrictions from early November on fully vaccinated travellers is very good news and will bring certainty to a key market. But challenges remain, September bookings indicate a deterioration in international recovery. That’s bad news heading into the traditionally slower fourth quarter,” Willie Walsh, IATA’s Director General said.

African airlines’ traffic fell 58.5 percent in August versus two years’ ago, somewhat improving over the 60.4 percent decline in July compared to July 2019. August capacity was down 50.1 percent and load factor declined 12.7 percent to 63.0 percent.

European carriers’ August international traffic declined 55.9 percent versus August 2019, significantly bettering the 63.2 percent decrease in July compared to the same month in 2019. Capacity dropped 45.0 percent and load factor fell 17.7 percentage points to 71.5 percent.

Asia-Pacific airlines saw their August international traffic fall 93.4 percent compared to August 2019, barely improving over the 94.5 percent drop registered in July 2021 versus July 2019 as the region continues to have the strictest border control measures. Capacity dropped 85.7 percent and the load factor was down 44.9 percentage points to 37.9 percent, by far the lowest among regions.

Middle Eastern airlines had a 69.3 percent demand drop in August compared to August 2019, improved upon the 73.6 percent decrease in July, versus the same month in 2019. Capacity declined 55.0 percent, and load factor deteriorated 26.2 percentage points to 56.2 percent.

North American carriers experienced a 59.0 percent traffic drop in August versus the 2019 period, much improved on the 61.7 percent decline in July compared to July 2019. Capacity sank 48.5 percent, and load factor dipped 18.0 percentage points to 70.3 percent.

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