Middle East airlines see 9.7% passenger demand growth: IATA

 

Middle Eastern Airlines' Growth in Passenger Demand

Key Findings:

• Passenger Demand: Middle Eastern airlines saw a 9.7% annual growth in passenger demand in May, driven by increased travel to and from Asia.
• Capacity Increase: Total capacity in the region grew by 9% year-on-year in May.
• Global Share: The Middle East handled 9.4% of global passengers in May, consistent with the previous month.

Factors Contributing to Growth:

• Economic Diversification: Countries like Saudi Arabia are enhancing their aviation sectors to diversify their economies away from oil dependence.
• Saudi Aviation Strategy: Aims to triple passenger numbers from 2019 levels, handle 4.5 million tons of cargo, and establish over 250 direct global destinations.
• Economic Contribution: Saudi Arabia’s aviation sector contributed $21 billion to its GDP in 2023.

Impact of Geopolitical Factors:

• Route Popularity: The Asia-Middle East route ranks second in terms of revenue passenger kilometers (RPK), having surpassed 2019 levels by 32%.
• Russia-Ukraine War: Influencing increased demand for Middle East routes as safer alternatives, impacting Europe-Middle East travel patterns positively.

Cargo Demand:

• Growth: Middle Eastern airlines saw a 15.3% year-on-year growth in cargo demand in May.
• Capacity: Total cargo capacity increased by 2.7% in May compared to the previous year.
• Global Share: The Middle East handled 13.5% of global cargo in May.

Global Passenger Demand:

• Overall Increase: Global passenger demand rose by 10.7% year-on-year in May.
• Capacity and Load Factors: Total capacity increased by 8.5%, and airlines filled 83.4% of their seats, a record for May.

Regional Performance:

• Asia-Pacific: Led global passenger demand with a 27% increase in May, capacity rose by 26%, and load factor reached 81.6%.
• Latin America: Experienced a 15.9% passenger demand growth and the highest load factor at 85.1%.
• Africa: Saw a 14.1% increase in demand and the fastest rise in load factor to 72.3%, despite having the lowest load factor overall.
• Europe: Noted an 11.7% growth in demand and an 11.3% increase in capacity, with a load factor of 84.7%.
• North America: Had the lowest growth at 8.7%, with a capacity increase of 7.7% and a slight decline in load factor to 84%.

Domestic and Future Outlook:

• Domestic Traffic: Increased by 4.7% globally in May, with a load factor rising to 84.5%.
• Positive Trend: IATA is optimistic about continued growth in both domestic and international segments for the rest of the year.

Saudi Arabia's Future Plans:

• New Airline: Riyadh Air, supported by the Public Investment Fund, is set to launch in 2025 with an aim to operate in 100 countries by 2030.
• Record Passengers: Saudi Arabia's aviation sector reached 112 million passengers in 2023, up 27% from 2022.

The Middle Eastern aviation sector is experiencing robust growth in both passenger and cargo demand, driven by strategic economic diversification and geopolitical factors. Saudi Arabia's ambitious plans under Vision 2030 further highlight the region's commitment to becoming a global aviation hub.