US cabin laptop ban leads to drop in air demand

US cabin laptop ban leads to drop in air demand

The US cabin laptop ban contributed to dampening demand for global airline travel in May.

But passenger demand during the month was still ahead of five and ten-year average growth rates.

Demand rose by 7.7% in the month over the 10.9% rate recorded in April, according to latest Iata data.

Capacity climbed 6.1%, and the load factor rose 1.2 percentage points to 80.1% – a record high for the month.

All regions, excluding the Middle East and North America, posted record-high May load factors.

Fares at the start of the second quarter of the year fell by around 6% against the same period 12 months earlier.

This contributed to around two-fifths of the annual growth in passenger traffic seen in May, Iata estimated.

However, the degree of fare stimulus is around half that seen in the second half of 2016.

“This stimulus is likely to fade further in light of rising airline cost pressures, while business confidence has softened,” Iata cautioned.

“However, passenger demand is likely to remain well supported during the upcoming peak travel months of July and August.”

Director general and chief executive, Alexandre de Juniac, said: “Passenger demand is solid. And we don’t foresee any weakening over the busy summer months in the Northern Hemisphere.

“But the rising price of fuel and other input costs is likely to see airlines’ ability to stimulate markets with lower fares taper over the coming months.

“In parallel, rising trade protectionism and barriers to travel are worrying trends that, if unchecked, could impact demand.

As a business airlines depend on borders that are open to trade and people.”

New enhanced US security measures as an alternative to global restrictions on the carriage of large electronic devices in cabins will be introduced over the next months across 280 locations worldwide.

“Enhanced security measures are preferable to the expansion of the current ban on the carriage of large electronic devices in the cabin. We have seen the negative impact that this has on demand,” de Juniac said.

“But the timeline to implement the enhanced security measures announced by the US Department of Homeland Security is extremely challenging. And there are many unresolved issues that need greater cooperation among states to minimise the impact on air travellers and global connectivity.”

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