International Air Traffic Up as Freight Growth Weakens

International air passenger traffic rose 7% in the first quarter of 2007, with strong economies driving demand for business and leisure travel, the International Air Transport Association (IATA) said.

Cross-border air freight, considered a prime indicator of the health of global trade, rose a weaker 2.7% from January to March, compared with the same period in 2006.

"Competition (with) other modes of transport -- particularly sea -- is holding growth below our forecast of 5.5% for 2007," IATA Director-General Giovanni Bisignani said in a statement.

Latin American carriers recorded a 7.2% year-on-year drop in freight demand in the first quarter, while Europe had a 0.2% decrease and North American carriers saw demand rise just 0.1%.

Middle Eastern carriers were the exception, with a 14.6% increase in freight demand, due to route expansion and an increased volume of perishable goods, IATA said.

Airlines from the Middle East also led international air passenger traffic in the quarter with a rise of 19.7% on the first three months of 2006. North American passenger traffic rose 6.1% and European carriers saw a 6.6% gain, while Latin American carriers had a 2.8% decrease.

"The story for passenger traffic is based on strong economies driving the demand to travel for both business and leisure markets," Bisignani said. "People want to travel and they are doing it in record numbers."

IATA, which represents 250 airlines accounting for 94% of scheduled international air traffic, estimates the airline industry should record profits of $3.8 billion in 2007. Domestic air traffic is excluded from its traffic data.