Premium-class air travel falls worldwide, says IATA

Friday, April 17, 2009, 19:04 by Aviation Correspondent

Premium-class air travel has dropped worldwide for the 9th successive month in February 2009 – by 21.1% – as more and more passengers are going for economy-class seats. According to data released by the International Air Transport Association (IATA), the fall in global premium-class travel speeded up in February 2009 compared to a 16.7% decline in January 2009, over the same period in 2008, and a 13.3% drop in December 2008.

The International Air Transport Association, which represents about 230 airlines comprising 93% of scheduled international air traffic, said in a statement that total
passengers numbers plunged by 9.6% in February 2009, or 6% if adjusted for an extra day (Leap Year) in 2008.

The weakness in long-haul routes meant that the average distance travelled is falling, according to IATA.

The Pacific region, IATA said, witnessed the worst slump in air traffic, down by 27.3% in February 2009.

Among bigger regions, the Asia region was the weakest. Premium-class demand in Asia declined, with the biggest decline in the Asia region happening in February 2009 across the Pacific – by 27.3%.

According to IATA, yields of the United States-based carrier across the Pacific region went down by 2.9% in February 2009 and by 4.5% in March 2009, suggesting that airlines based in the Asia region have been hit hardest by the reduction in demand for premium-class travel.

It was only Africa, which reflected a growth in the premium-class travel segment – up by 2.8% – though the Africa region is very small compared to other regions.

Across the North Atlantic, according to the IATA, premium-class travel plummeted by 22.5% in February 2009, following a 14.5% drop in January 2009.

Declining premium-class travel particularly affects those airlines that depend on selling first-class and business-class tickets to earn a considerable quantity of their profits, the International Air Transport Association said in its report.

IATA also warned that the financial performance of airlines would come under major pressure in the first quarter of 2009 as revenue falls, especially in view of carriers cutting premium-class fares at a fast rate since November 2008.

In a separate report, the United States Air Transport Association – the trade group of the major airlines based in the United States – said that passenger revenue for US airlines dropped by 23% in March 2009, compared to March 2008.