IATA: Traffic growth supports optimism

International passenger traffic
grew by 6.8% and international freight traffic by 5.4% in February, according to the International Air Transport Association.The
year-to-date passenger traffic growth of 6.4% is in line with industry
projections of 6.5% growth in 2006. International freight traffic grew
by 5.3% for the first two months of the year after a period of
volatility and weakness in 2005.

“February, traditionally the slowest month for international traffic,
brought both good news and solid growth. The recovery in freight has
stretched to three months with growth of over 5% resulting from strength
in international trade. While passenger growth was in line with
projections, North American carrier growth of 3.6% is significantly
below the high levels recorded in 2005 as US carriers re-allocated
domestic capacity to higher-yielding international markets,” said
Giovanni Bisignani, IATA Director General and CEO.

The Middle East remains the fastest growing region with 15.3% passenger
traffic gain largely being matched by capacity growth as new aircraft
are delivered to the region. Improved economic conditions in Continental
Europe and Japan led to increases of 7.3% in Asia and 6.4% in Europe.
Load factors also improved. February’s passenger load factor of 73.3%
was 1.2% higher than in February 2005.

Freight demand also grew at a slightly higher rate than freight
capacity. Middle East (19.9%) and Latin America (10.7%) led the world
with double-digit freight traffic growth rates. European freight volumes
(2.1%) are finally seeing positive volume growth after two months of
decline.

“February’s growth supports a new and cautious optimism that is
returning to the industry. Cost cutting and growth will reduce 2006
losses to US$2.2 billion and lead to a profit of US$7.2 billion in 2007.
We are moving in the right direction, but a 3% return on capital
invested is a long way from sustainable profitability,” said Bisignani.

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“As industry prospects improve, staying focused on efficiency and cost
reduction remains at the top of the industry’s recovery agenda. Our
industry partners must step up to the plate and match airlines’
efficiency efforts, particularly in Europe-home to the 15 most expensive
airports in the world. The European Commission has recognised the need
for greater transparency in airport costs and is committed to a Lisbon
Agenda to make Europe more competitive. On 7 April, we will present a
strong case for more efficient airport infrastructure to the European
Commission,” said Bisignani.
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