Recession Hits Aviation Marketplace Hard, And It's Spreading Outside US

The Air Transport Association of America, industry trade organization for most US airlines, issued its first of what is expected to be a series of reports on the impact of the global recession on passenger and cargo airline traffic. And the news isn't good.

According to ATA, passenger revenue among its member airlines fell 19 percent in February 2009 versus the same month in 2008 -- the fourth consecutive month in which revenue has fallen from the prior year. Twelve percent fewer travelers paid 8 percent less to fly one mile on US airlines, with declines extending beyond the mainland United States to transatlantic, transpacific and Latin markets.

Year-over-year results were also adversely affected because February 2008 consisted of 29 days, ATA noted.

Compounding the softening demand for travel, US airlines saw cargo traffic -- as measured by revenue ton miles -- decline 21 percent year over year in January 2009, after back-to-back 17 percent declines in November and December 2008. Notably, transpacific cargo traffic fell 32 percent. February 2009 cargo data is not yet available.

"The sharp decline in spending by passengers and shippers demonstrates how the global recession is taking an increasing toll on the traveling public, as well as on time-sensitive cargo shipments," said ATA Chief Economist John Heimlich. "The worldwide slowdown is forcing further capacity reductions, despite the meaningful drop in fuel prices."

Annually, commercial aviation helps drive $1.1 trillion in US economic activity and more than 10 million US jobs. On a daily basis, US airlines operate nearly 30,000 flights in 77 countries using more than 6,000 aircraft to carry an average of two million passengers and 50,000 tons of cargo.

More than half of US exports by value move by air and every $1 million of aviation economic activity generates approximately 24 US jobs.

ATA airline members and their affiliates transport more than 90 percent of all US airline passenger and cargo traffic.

FMI: www.airlines.org