IATA Travel says demand for holding companies, a sign of recovery
SINGAPORE, (Reuters) – Demand for business travel is holding better than price-sensitive leisure travelers in a sign of business confidence and a resumption of world trade, the chief economist of global airlines body IATA said on Tuesday. Airlines also expect renewed growth in demand for air transport in the second half of this year, as the movements of capital goods and high value components pick up, Brian Pearce said. Air transport demand soared as the global economy emerged from recession last year, driven by restocking and just-in-time supply chain. Pearce said the Chinese domestic traffic, which is often regarded as a barometer of the stimulus inside the second largest economy in the world, had dipped temporarily as authorities moved to prevent inflation, but should return to a path of structural growth. He warned that the delivery records of some 1,300 to 1,400 jets and turboprop aircraft in 2011 has created a "clear risk of overcapacity" in some markets, but noted that the prospects of the aviation industry in Asia ex-Japan has remained positive. Japan, he said, should show a "fairly full recovery" in air traffic by the end of the year as the impact on global supply chains from the March 11 earthquake and tsunami tapering off. (Reporting by Tim Hepher; Mounting Raju Gopalakrishnan)
