Passenger yields in the US are down 5% year-on-year and fares in other regions have fallen further, reflecting downward pressure from earlier declines in fuel related costs as well as exchange rate distortions.
Key points:
- Airline share prices have been falling because of investor profit taking, particularly in the US, but in June they were still up by 10% compared to a year ago;
- Q1 financial results show large improvement in profits, especially for US carriers but also in Asia Pacific;
- Crude oil prices fell in June after a little rally in May, pushed down by expectations of supply increases from Iran and the US – levels are now down 45% on 2014 highs;
- Passenger yields in the US are down 5% year-on-year and fares in other regions have fallen further, reflecting downward pressure from earlier declines in fuel related costs as well as exchange rate distortions;
- Air transport volumes continue to expand robustly, while trend in FTKs stays flat on weakening trade activity;
- Growth in seats accelerated in May as more aircraft came out of storage, surpassing expansion in demand;
- Air freight load factors fell further in May, sinking to levels not seen since mid-2009, but passenger loads were sustained above 80%.
Airlines Financial Monitor June 2015
Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.
