ANALYSIS: Airline market outlook February 2014

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Airline market data for the US majors in December published by Airlines for America showed a strong end to 2013 as passenger traffic growth of 6.5% outpaced the extra 2.9% of capacity added.

This helped passenger load factors for the US majors climb nearly three points during December, to 84.9%.

This was out of the step with the full-year performance of the US majors as traffic grew roughly in line with the relatively cautious capacity increase of 1.7%. Load factor for the full year was fractionally up at 83.6%

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Traffic among European mainline carriers, as recorded by AEA members, rose 3% on a capacity rise of 2% in December. This helped load factor for European carriers increase almost a point. This is roughly in line with AEA carriers’ general growth in traffic and load factor across the year.

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Latin American carriers reported a strong December to finish the year with traffic up 7.5%, comfortably above the 4% extra capacity and lifting load factors for the month more than two percentage points. Load factor across the full year for ALTA carriers is running more than a point higher on traffic increased around 7%

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However, Asia-Pacific carriers suffered a second consecutive month of load factor decline as traffic growth of 5.4% fell short of the extra 6.1% capacity added by AAPA carriers. Over the full year, though, Association of Asia Pacific Airlines members’ load factor was fractionally higher as traffic growth of 5.3% more than matched the extra capacity added by carriers in the region.

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Double-digit passenger growth among Arab carriers for the full year fell short of the extra capacity as load factor slipped 1.5 percentage points to 67.8%.

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Average fuel prices fell 2.2% in January and are around 5% lower than at the same stage last year.

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Innovata schedules data for March shows airlines adding 7.5% to global capacity, as measured in weekly ASKs.

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That includes a 7.4% increase in capacity on North Atlantic routes as the biggest operators on the sector – British Airways and United Airlines – both increased capacity.

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