IATA gauges terrorism impact on airlines

The terrorist attacks in Western Europe in late 2015 and early 2016 reduced European airlines’ international passenger traffic by around 1.6 per cent in the following year.

Airline industry body IATA estimates that this reduced European airlines’ 2016 revenues by around US$2.5 billion.

“Nonetheless, as was the case during the SARS pandemic in 2003 and the Icelandic ash cloud in 2010, the impact on European international passenger traffic has been only temporary,” it said. “This underlines the resilience of air passenger demand to short-lived shock events. By contrast, events such as 9/11 and the global financial crisis are associated with permanent impacts on both the trend RPK level and growth rate for European international traffic.”

IATA said the most visible impact of the terrorist attacks in Western Europe was on international RPKs flown by European carriers; where traffic fell below its trend level following the Paris attacks in November 2015.

International RPKs started to rise again immediately afterwards in seasonally adjusted terms, but the upward trend was interrupted following the Brussels bombing in March 2016.

“Given that European airlines’ international traffic accounts for around 24 per cent of industry-wide RPKs, this impact was felt at a global level too,” IATA said.

It said European airlines’ international traffic only started recovering fully from June 2016 onwards, when it began growing faster than its trend pace. This was helped by a pick-up in global and regional economic conditions, as well as broader stimulus from lower airfares.

“All told, European airlines’ international traffic recovered above its trend level by the end of 2016. At a route-level, there is still a lingering impact on the Europe-Asia market – outbound travel from Asia is known to be particularly sensitive to shock events; while recovering, RPKs flown between Europe and Asia are still not back to where they would have been if they had followed the seasonally adjusted trend in place ahead of the terrorist events. By contrast, the level of international travel within Europe has since fully recovered back to its ‘pre-attacks’ trend level.”

Posted in Airlines, Corporate, News

Comments are closed.