Global airline recovery to suffer from volcano chaos

European airlines are likely to be hit the hardest by a dip in the recovery for global air travel caused by the Iceland volcanic ash shutdown, IATA warned yesterday.

Latest International Air Transport Association data showed that passenger traffic rose 10.3 per cent in March, while air freight grew 28.1 per cent year-on-year as the recovery from the economic crisis accelerated.

But European carriers lagged behind the global average with just six per cent growth in March.

"The strong traffic recovery is expected to show a dip in April as a result of the eruption of an Icelandic volcano... that saw the shutdown of large portions of European airspace over a six-day period," IATA said.

IATA director general Giovanni Bisignani predicted that European carriers would suffer the most from the travel chaos, despite an expected swift rebound.

"European carriers were already showing the weakest recovery from the (global) financial crisis through March. The volcanic ash crisis hit the weakest part of the industry the hardest," he said in a statement.

"The majority of the $1.7 billion in lost revenues was by Europe's carriers.

"The combined impact of lost business and added costs will certainly hit the bottom line. Passenger confidence is not affected and we expect a quick rebound," he added.

Overall, the recovery in international air traffic accelerated last month, led by year-on-year growth in the Middle East of 25.9 per cent, with Asia on 12.6 per cent and North America 7.8 per cent.

IATA cautioned that although the gains were strong, the data was being compared to March 2009, which was the low point for international air travel during the recession.