Brexit and US-China trade tensions creating airline uncertainty

Brexit and US-China trade tensions are contributing to cloud growth expectations for global airlines.

Iata reported a slowing of growth in the second half of last year.

Overall passenger carryings rose by 6.5% to more than 4.3 billion, although the percentage was down from the 8% growth achieved in 2017.

The 2018 result was achieved on capacity growth of 6.1% with the load factor edging up 0.3 percentage point to a record 81.9%, exceeding the previous high set the previous year.

Demand growth declined to an annualised rate of 5% in the second half of 2018 compared to 9% in the first six months.

Traffic growth by European carriers “has softened a bit in recent months, likely owing, in part, to uncertainty over the economic backdrop and Brexit,” the airline trade body revealed.

Iata director general and CEO Alexandre de Juniac said: “2018 was another year of strong passenger demand, as aviation continued to support the global economy. We expect similar, if somewhat moderating performance in 2019.

“Nevertheless, slowing growth in the second half of 2018, coupled with concerns over issues including Brexit and US-China trade tensions, are creating some uncertainty to this positive outlook.”

He added: “Aviation continued to demonstrate why it is the business of freedom in 2018. We safely transported more than 4.3 billion passengers. These people used air connectivity to conduct trade and business, reunite with friends and loved ones, explore the world, and, in some cases even to begin new lives.

“Aviation makes the modern world possible, but we depend on borders that are open to people and trade to be effective.

“In 2019, we will be strong advocates against a rising tide of protectionism and trade conflict, so that the business of freedom can continue to do its part to make the world a more prosperous and happier place.”


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