Asia-Pacific airlines still face ‘challenging’ environment despite easing of conflict: AAPA

International passenger volumes in May dipped 1.1% year-on-year. 

The Association of Asia Pacific Airlines (AAPA) has warned that operating conditions for the region’s carriers “remain challenging”, even after the easing of tensions in the Middle East and falling fuel prices.

AAPA director general Wong Hong says much volatility still stems from “geopolitical developments, trade policy shifts and broader economic headwinds”.

In comments made alongside traffic data for May, Wong adds: “Rising inflationary pressures are also contributing to higher non-fuel operating costs, and may weigh on consumer spending and travel demand in the months ahead.”

Fuel prices, while lower than in the early days of the Iran war, still place “pressure” on airlines’ operating costs, he notes.

His comments come as Asia-Pacific operators wrap up the April-June quarter, one that has been marked by high fuel prices and operational cuts.

Underscoring the uncertainty faced by Asia-Pacific operators, AAPA’s traffic data showed a moderation of traffic growth. In May, airlines in the region carried 31.7 million international passengers, down 1.1% year-on-year.

Traffic was up 1.8% in May, compared with the same month last year, led by strong long-haul demand but offset by capacity cuts on regional routes. Capacity remained broadly unchanged, bringing passenger load factor up 1.2 percentage points to 82%.

Cargo data, meanwhile, showed a 2.5% rise in freight tonne kilometres year-on-year, on the back of increased stockpiling activity and increased technology product shipments.