16 May 2005
April 2005 was an unusually soft month for passenger growth at Wellington Airport. While April was less affected by fog than previous months, April was impacted by a shift in the timing of Easter. In 2004 Easter was in April, rather than March. A more moderate rate of growth was expected after the boom in traffic at this time last year.
International passengers grew only 1.2% in April, with a 4.4% increase in seats. Total international load factors fell very marginally, but remain very respectable at 75%. However, there has been a significant improvement in the balance of load factors across airlines and routes, and new routes have managed to achieve sustainable load factors. Fare levels and yields appear to have crept up over the past twelve months, suggesting more sustainable profitability on international routes and a more moderate rate of growth than the boom of 2004/05.
Domestic passengers fell by 3.1% on the previous year, against a 4.8% fall in seats. This gives a misleading impression of the strength of demand. Almost all of the fall can be accounted for in the withdrawal of Origin Pacific capacity and services following their network restructure. Trunk routes experienced growth of 4.4% in passengers and load factors have also improved, revealing ongoing underlying strength. On some routes, capacity growth will need to continue to avoid introducing constraints on growth. The dramatic changes in Origin Pacific affect regional routes in two ways. Apart from the direct impact of withdrawal of capacity, the changes in Origin have diminished competition on some regional routes. Several regional routes show reductions in capacity over and above changes made by Origin and in most cases, consequential reductions in passengers. This trend may change with the introduction of larger aircraft on regional routes later. Only time will tell how that capacity will be used to grow the regional market.
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