Air Transport World

U.S. majors lead financial surge in '84; large European airlines also had impressive year, but U.S. airlines are increasing world market share. (1984 Market Development Report)

U.S. majors lead financial surge in '84

All in all 1984 was a very good year for the world's airline industry. It was especially good for the major carriers in the United States and the large airlines of Europe. There were records set for traffic. There were records for profits.

The chief reasons for all of this were things that did not happen as much as the things that did happen. For the first time in the 1980s there were no major jolts like a fuel crisis (fuel prices actually declined again, see graph), major air traffic controller walkouts and airplane groundings in the U.S. And in the U.S. the debris of deregulation has begun to settle into some predictable patterns.

Probably the biggest positive factor in the good returns, especially in the United States, was a surging economy which added momentum to a trend begun in 1981 . . . the U.S. airlines regaining world market share. U.S. airlines produced half of the world's airline traffic as late as 1970, and then steadily lost ground until they generated only 35.4% of the world's revenue passenger-kilometers in 1981, according to International Civil Aviation Organization figures. As the U.S. economy began to improve in the 1980s U.S. market share increased to 36% in 1982, 37.6% in 1983 and then, according to our figures compiled for this issue, U.S. market share climbed to 40.5% in 1984.

The U.S. economy and the strong dollar produced some startling results on the North Atlantic in 1984, especially in air freight. Freight traffic was up 19.6% for all services over 1983, which was not a bad year either with traffic increasing 8.7% Westbound cargo traffic was robust in both years, increasing 24.2% in 1983 and another 27.5% in 1984. Passenger traffic was also strong in 1984 as both east and westbound traffic went up 12.6% for all services. It was up 6.3% in 1983.

A big factor in the general airline prosperity, second only to the U.S. majors' success, was the good year turned in by the large European carriers, some of which produced record results. The European carriers began to enjoy their turnaround in the second half of 1983, and the favorable trend continued through 1984.

Around the world the major groups and organizations reported 1984 traffic as follows: ICAO preliminary figures show that world airlines carried 832 million passengers last year, 5% more than in 1984 and the best growth year since 1979 when boardings rose 11.1%. ICAO says that when the final tallies are made 1984 RPKs will total about 1.256 trillion, 6% more than those for 1983. ICAO predicts that air freight traffic for 1984 will show a 14.5% increase over 198o with 39.4 billion FTKs generated. This is the biggest gain for freight growth since 1973. It follows a good 1983 when total freight traffic growth around the world was 10%. ICAO's figures cover all the airlines of its 153 member nations, or just about all the airlines.

International Air Transport Association reports that 1984 was the best year for its members since 1978, although the figures are not as robust as ICAO's, largely because of the absence of many large carriers in IATA ranks. Four of the top 10 passenger carriers are not IATA members. Nonetheless, IATA member passenger traffic was up 3% overall in 1984 with most of the growth coming from international services where passenger boardings rose 7%. Freight traffic was up 11% overall and 13% for international operations.

U.S. Air Transport Association, meanwhile, reports that its member airlines showed a 4.4% increase in scheduled RPKs in 1984 with much of the growth coming from international passenger traffic which was up 9% over 1983's. ATA members' freight traffic was up 10.9%. systemwide in 1984 with international traffic up 12. …

Log in to your account to read this article – and millions more.