Global air traffic may have bottomed
FWIW, the International Air Transport Association believes that the 9.3% drop in airline passenger traffic that the industry experienced worldwide last month may represent a bottom. This 9.3% decline follows a massive 11.1% drop in March and a 3.1% decline in April.
Things are even worse on the cargo side. International air cargo traffic dropped 17.4%. This is actually an improvement though from the negative 20-something percent numbers that the industry had been putting up since December.
Not surprisingly, swine flu concerns have absolutely crushed Mexican air traffic. Passenger traffic to Mexico fell by 40% in May. Ouch. Despite this terrible news, the stocks of Mexican airports OMAB, PAC, and ASR have been on a roll. I knew that once the initial reports about swine flu didn't hammer these stocks that they had seen at least a temporary bottom and I ended my CAPS short of them while they were still in the green.
Even though the IATA doesn't expect traffic to continue to fall, it is not looking for a rapid recovery either. The group's CEO called the current slowdown "the worst we have ever seen.”
Air Traffic Decline of 9.3% May Represent ‘Floor,’ IATA Says