Traffic for November. Dreadful

It doesn’t matter which metric we use its all bad. So I will just pick on a few highlights.
As we have noted for the last 3 months the downward turn has been accelerating.

In the past month we have seen:

The US airlines drop off has again been precipitous down 11.3%. We have all the majors reporting and its just plain bad
Delta Airlines;
Latest report shows passengers down by -7.5%
Southwest Airlines;
Latest report shows passengers down by -10%
American Airlines;
Latest report shows passengers down by -15.9%
Continental Airlines;
Latest report shows passengers down by -12.5%
Northwest Airlines;
Passenger numbers for the month are down by -10.5%
US Airways;
Just reported: passenger numbers drop by -8.8%
United Airlines;
Latest report shows passengers down by -17.8%
AirTran;
Passenger numbers for the month are down by -7.3%
Republic Airlines;
Latest report shows passengers down by -5%
American Eagle;
Passengers for the month are down by -20.4%

Travel Agent sales in the USA plummet 20% according to ARC. Remember that this tends to be a measure of forward sales whereas the Airlines are reporting traffic. This shows that the agent sales are falling faster than sales via the airlines directly. So we are seeing the double wammie of both share shift to Direct and general reduction. This bodes very badly for the intermediary infrastructure at least in this market. It also indicates that Both Leisure and Corporate segments are seeing a decline. We believe that transactions at the major online players have already turned negative. Similarly the Corporate Travel market is down.

Nor is capacity down in just the USA market. Here is just a quick peak at two of Europe’s big airlines:

Ryanair;
Considerable passenger growth announced for the month: 10.9%

British Airways;
Passenger numbers for the month are down by -7.8%

Yet another Ouch… Is this going to drive the next wave of merger activity? I actually hope not. The airlines have always acted with a communal knee jerk response. Clearly LH is cleaning up. BA is struggling with its 3 deals (TransAltantic alliance, IB merger and QF merger). All it seems to be doing is pissing off its potential partners. Even Ryanair is playing nice and taking another run at Aer Lingus.

Cheers