The growth in premium passenger numbers on international routes slowed slightly in November, although it is still high enough to prevent concern, according to the International Air Transport Association.
the number of premium passengers was up by 9.6% year-on-year in November, compared with the 11% rise in October. Economy numbers, meanwhile, increased by 7% in November, versus 7.6% growth in October.
IATA notes that premium demand is “trending down slowly,” although this is to be expected due to the comparison with strengthening demand in the same months in 2009. There is nowhere near the same concern as there was in August, when year-on-year growth dipped to 6.4%.
Even though premium traffic is rising more quickly than economy, premium is still below prerecession levels, while economy numbers are reaching new peaks. This is because the dropoff during the downturn was far steeper for premium traffic.
Premium passenger numbers are still about 12% lower than their February 2008 peak when adjusted for seasonal fluctuations. While this may look like a structural change in premium travel, IATA believes it is due to the fact that some drivers of international business travel have yet to recover, such as world trade and equity markets.
Latest data on business confidence show optimism increasing at the end of 2010, after a “wobble” that was seen between May and September. Despite the small November dip, IATA notes that “the economic drivers behind business travel still appear solid,” and “further gains in both premium and economy travel should be evident in coming months.”
IATA estimates that premium revenue on international routes was up 12-13% in November, although the 3% increase in average fares was lower than the 5.5% rise in October and 6.6% in September.
Once again, the strongest increases came on international routes either within Asia or from Asian markets to elsewhere in the world. The only major markets to see declines were travel within Central America, which was down by 63% year-on-year, and between Central and South America, down 5.5%. These drops were primarily due to the Mexicana bankruptcy.