22 March 2009

US Airlines decline again

Its old news but these days the decline seems to be pretty constant. So far I have been focusing on a number that says that from mid 2008 to the end of that year traffic declines would be about 10%.The prediction for this year was to be a further 5 points decline. The latest numbers from ATA - the US Airlines body indicates that Feb was indeed down by 12% volume but that 8% revenue per pax flown was a bit of a jolt. Feb however was a larger month last year with both more days and more weekdays in it. So far I am tracking against my prediction.

The big question is when will the bottom hit. Economists are saying end of the year. I think they are being a little optimistic.

With ticket volumes down in the USA and revenue numbers also down significantly per ARC the true picture can emerge now.

If we compare Tickets as passengers and ticket revenue as sales on the airlines we see the following:

Source: ARC ATA

Tix/Pax. 18% 12%

Rev/Sls. 26% 19%

This tells me we really do have a differential between the GDS/ARC based revenue and he carriers' revenue. If Sabre says it is gaining share and Amadeus was smaller and not as affected, this points to some ugly numbers at Travelport.

I do believe we shall see these trends continue throughout 2009. The good news will be if March shows a slight improvement in the overall decline. This remains to be seen.

Fingers crossed.

Cheers

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