Key market insights

year-on-year growth in Revenue Passenger- Kilometres (RPK)
Passenger numbers recover

The International Air Transport Association (IATA) reported an increase in passenger demand in both January and February 2024.

In February, the airline industry experienced a full recovery in total passenger traffic, surpassing the levels seen in 2019 by 5.7%. This indicates that the industry has successfully rebounded from the impact of the pandemic. The year-on-year growth in Revenue Passenger- Kilometres (RPK) reached an impressive 21.5%.

The passenger load factors (PLF), which measure the percentage of seats filled on flights, showed improvement compared to the previous year and settled around pre-Covid-19 levels. This suggests that airlines are operating more efficiently and effectively in filling their flights.

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Lunar New Year boosts domestic flights

In terms of domestic traffic, there was a significant growth. Over the course of the year to February 2024, domestic traffic increased by 15.0% compared with the year to February 2023. This strong performance can be attributed to the robust performance of major markets and the surge in travel during the Lunar New Year period, particularly in China, where domestic traffic reached new highs with year-on-year growth of 31.5%.

The annual growth in international traffic was remarkable at 26.3% in the year to February 2024 compared with the same period in 2023. The Asia Pacific region led the way in terms of growth, as international travel to and from the region continued to recover. Other markets that had already experienced an earlier rebound also showed solid traffic growth during this month.

Derek Wong
Derek Wong, Head of Aviation Debt Funds

Thai Airways, Philippine Airlines and Cathay Pacific are among a good number of Asian carriers that have reported strong operating profits for 2023, signalling a new era of profitability after the Covid-19 pandemic.

Resilient demand brings ticket sale stability

Ticket sales saw a significant increase ahead of the Lunar New Year, both for domestic and international travel. This peak in demand was followed by a brief slowdown in ticket purchases. However, during March, ticket sales stabilised, indicating resilient demand for air travel. This stability suggests that there is ongoing and sustained interest in air travel, despite the fluctuations in demand.

Overall, these statistics indicate a positive recovery trend in the airline industry, with strong growth in passenger traffic, particularly in domestic markets and the Asia Pacific region. During the Lunar New Year break, domestic ticket sales contracted compared to the previous year, while sales for international travel remained higher than in 2023. Over the month of March, ticket sales for both travel segments remained elevated compared to the previous year, indicating consistent high demand for air travel following the Lunar New Year break.

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