US air travel slump easing

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Two major US airlines, American and United, saw an ease in the decline of passenger numbers last month, suggesting that the downturn in air travel may be starting to bottom out.

For the six largest carriers in the US, passenger traffic fell by 11 percent, as compared with the same month in 2008. This was lower than the 11.4 percent drop seen in February, according to figures provided by Bloomberg.

American, Continental and United all reported smaller declines in March than in the previous month, while Delta Air Lines saw a larger decrease in passenger numbers.

These latest results are suggesting the start of a stabilization in passenger demand after the recession led to a downturn in both business and leisure travel. As demand increases, airlines will be able to increase fares again, reversing the trend toward lower fares as carriers struggled to fill seats.

“There might be some early signs that things are improving,” said New York-based Matthew Jacob, a Majestic Research analyst.

Investors are also indicating that they are optimistic about the airline industry, with the Bloomberg U.S. Airlines Index seeing a 50 percent gain since its low on March 5.

“A sentiment rebound is likely to drive shares higher in the near term,” said William Greene, a analyst with Morgan Stanley in New York.

Thanks to www.bloomberg.com for the above quotes, for more information on this article please visit their website.

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