Published On: Tue, Oct 20th, 2015

IATA’s assessment of premium and economy travel in August

IATAIATA’s assessment of premium and Passenger travel on international markets was up 5.4% in August year-on-year, reflecting strong growth on the Within Europe travel market;

Both travel classes showed an above-trend rise in August year-on-year – premium travel was up 5.3% and economy travel rose 5.4%;
Economy class travel – the more price sensitive travel market – has experienced stronger growth so far this year, supported by lower fares over recent months;

Growth in premium international travel has been subdued due to weakness in business travel demand drivers, particularly in emerging markets;
The major contributor to the August industry figure (about 40%) was the Within Europe market, which includes connecting segments of longer-haul travel;

Growth in premium travel across the North Atlantic also started to accelerate, up 6.8% in August, which is a good sign for yields and revenues;

The strength of air travel activity within Europe was more than enough to offset weakness in other markets, most notably in Asia;
Looking ahead, if we extend the current trend in volumes through to the end of 2015, we could see year-on-year growth in the solid range of 4-5%;

This growth, however, is narrowly based and largely driven by travel Within Europe and across the North Atlantic;
With slowdown on key markets like Within Far East, as well as continued weakness in business confidence and world trade, the outlook for international air travel growth remains fragile.