The Hindu Business Line : US credit crunch beginning to impact air travel

Mumbai, March 30 What could be seen as the first sign of the credit crunch in the US impacting air travel, at least two Asian carriers, Air India and Singapore Airlines, said they are witnessing a softening in load factors from the country.

“Fasten your seatbelts. There is likely to be turbulence ahead,” is what Mr Giovanni Bisignani, Director-General and CEO of IATA, said in a statement last month when the association released the global January traffic results. He added, “January traffic results show that we could be at a turning point. A month’s data are not enough to define a trend, however, the sharp shift in demand growth patterns makes it clear that the US credit crunch is negatively impacting air travel.”

In line with IATA chief’s observation and responding to a query on whether the fears of slowdown in the US economy are causing concern among travellers, Mr C.W. Foo, General Manager, Singapore Airlines (India), conceded that the carrier’s passenger loads to and from US in February 2008 have seen a “slight dip” vis-À-vis the same period last year. Singapore’s national carrier is among the top 15 carriers worldwide in terms of actual passenger traffic and is the 8th largest airline in Asia.

It is also planning to launch an all business class flight using Airbus 345 between Singapore and New York which will be converted progressively from May 15, he said.

Air India’s spokesperson, Mr Jitender Bhargava, said that the airline was experiencing a “marginal” softening in its passenger load factors from US to India in the last three months. The national carrier started daily non-stop flights to the US only from August 1 last year.

However, both the carriers said that bookings from India to the US remain strong.

Jet Airways, the private sector Indian carrier which also commenced operations to the US on August 5 last year, did not give any clear answer on the issue. Mr Saroj K. Datta, Executive Director, told Business Line, “One doesn’t even know how deep seated the whole recession is. I feel it is too early to assess whether it’s having any impact on our load factors.” Jet operates flights to New York and Newark through its hub in Brussels.