Airline share prices fell 5% in August compared to July, dragged down by the fall in the broader market, which was down 6% over the month;
The financial performance of the airline industry has been mostly solid up to the middle of the year though, with Q2 results showing large profit improvements in the US and Asia Pacific, but down in Latin America;
Crude oil prices fell further in August, pushed down by expectations of supply increases from Iran and the US as well as a softer demand outlook – levels are down 58% on 2014 highs;
Passenger yields in the US continue to fall and although the US$ appreciation has exaggerated declines in global fares, currency adjusted levels are also down, 6% on a year ago;
Weakness in yields and fares reflects downward pressure from declines in fuel costs and stronger growth in capacity relative to demand in some regions;
Air transport volume growth was strong in July and the trend for 2015 remains robust – by contrast, air freight volumes fell further on weak trade activity;
Growth in seats moderated in July as new aircraft deliveries decreased, lagging expansion in demand;
Passenger loads improved slightly as growth in demand outstripped the moderation in capacity, but air freight load factors fell further to levels not seen since mid-2009.
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