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January 2019 IATA Air Passenger Market Analysis
Passenger growth starts the year on a positive note


Highlights of the January 2019 Air Passenger Market Analysis

  • Annual growth in industry-wide revenue passenger kilometres (RPKs) rose to 6.5% in January, its fastest pace in 6 months. We caution that traffic data at this time of year can be impacted by the timing of Lunar New Year. 
  • Capacity continues to grow broadly in-line with demand, with the load factor at 79.6% this month. 
  • China was the fastest growing domestic market this month, with India & Russia also posting double-digit RPK growth.

Growth rises for Africa’s airlines
Year-on-year growth in international RPKs flown by airlines based in Africa rose to 5.1%yoy in January. Although this is an improvement compared to December 2018, the upward trend in SA passenger traffic has generally softened in recent months with businesses remaining concerned about the economic outlook in key countries in the region. Indeed, business confidence has been falling sharply in Nigeria since November and remains below the 50-mark consistent with contraction for Egypt and South Africa.


Pick-up in annual passenger growth in January…
Industry-wide revenue passenger kilometers (RPKs) started the year on a positive note, increasing by 6.5% year-on-year, the fastest pace since mid-2018. The result is just ahead of the average RPK growth rate seen over the past decade (6.1%) but lies some way below its five-year average (7.1%). 

   All told, the seasonally adjusted (SA) upward trend in RPKs accelerated slighty in January, following the moderation seen over the second half of 2018 (see Chart 1). RPKs have risen at 4.6% annualized pace since mid-2018, down from closer to 9% seen earlier in the year. For now, it is too soon to think that this month’s pick-up represents a shift in trend.


Economic backdrop remains less supportive

The slowdown in industry-wide RPK growth in 2H18 corresponds to ongoing concerns about the future of the global economic expansion, with the most recent data suggesting that Q4 GDP growth softened across a number of the world’s key economies. 

   On top of that, the global composite Purchasing Managers’ Index – a useful leading indicator of air passenger demand growth in the past – has been trending downwards recently (see Chart 2) and is currently at its lowest levels since September 2016. 

   Recent developments in the index point to RPK growth at a pace of around 6%, consistent with our current forecast for 2019, but down a little from 6.5% in 2018. Download the full document here. 

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