US Domestic Air Travel Demand Declines in May 2025, While Global and International Travel Sees Growth

Published on July 2, 2025

In May 2025, U.S. domestic air travel demand, as measured by revenue passenger kilometers (RPK), continued its downward trend, marking the fourth consecutive month of decline. According to the International Air Transport Association (IATA), U.S. traffic saw a 1.7% year-over-year drop. This follows similar reductions in previous months—4.2% in February, 1.7% in March, and 0.5% in April. The ongoing decline in U.S. domestic demand is attributed to economic uncertainty, including concerns about inflation and slower economic growth, as well as a reduction in government travel. These factors have contributed to a contraction in passenger numbers across domestic flights.

The U.S. passenger load factor (the percentage of available seats that were filled with passengers) also saw a decline in May, dropping by 3.1 percentage points year-over-year to 83%. This indicates that while airlines increased their capacity, they were not able to fill as many seats as they had in the previous year. However, capacity—measured in available seat kilometers (ASK)—increased by 2% compared with May 2024, reflecting airlines’ continued efforts to expand their services despite the downturn in demand.

Despite this decline in the U.S., global air travel showed a different picture. Total global demand for air travel in May 2025 rose by 5% year-over-year, matching the increase in capacity. The global load factor for May was slightly lower than the previous year, decreasing by 0.1 percentage point to 83.4%, which is still a strong indicator of overall airline performance worldwide.

The international demand saw a significant boost, rising by 6.7% compared with May 2024. This uptick was matched by a 6.4% increase in capacity, and the load factor for international flights improved by 0.2 percentage points to 83.2%. This was the highest load factor ever recorded for May international flights, signaling strong demand for global travel despite the challenges faced in certain regions. Domestic travel, on the other hand, had a more modest increase, with domestic demand up by 2.1% year-over-year, while capacity increased by 2.8%. The domestic load factor in May 2025 decreased by 0.5 percentage points to 83.7%, suggesting that even with increased flights, passenger numbers on U.S. domestic routes remained subdued compared to international travel.

IATA’s director general, Willie Walsh, acknowledged the uneven nature of air travel demand growth in May, stating that while global demand for air travel showed positive signs, North America remained an outlier with its decline. He further commented that “severe disruptions in the Middle East in late June remind us that geopolitical instability remains a challenge in some regions as airlines maintain safe operations with minimal passenger inconvenience.” Walsh highlighted that geopolitical instability in some parts of the world continues to have an impact on air travel, affecting oil prices and, by extension, the cost of operations for airlines. Fortunately, oil prices remained low throughout May 2025, contributing to a more stable financial environment for airlines.

Moreover, consumer confidence remained relatively strong, as evidenced by forward bookings for the peak Northern summer travel season. These positive signs of future bookings gave industry leaders reason to be optimistic about continued growth in the second half of 2025. Despite economic challenges, the outlook for international and domestic travel remained relatively optimistic, with strong demand for air travel expected to continue throughout the year.

Regional Demand Variations

Looking more closely at specific regions, the figures revealed varying patterns of growth. Asia-Pacific led the way in May, with a remarkable 13.3% year-over-year increase in international air demand. This significant growth in demand came alongside a 10.6% rise in capacity, making it one of the most dynamic regions for air travel growth. The demand growth in Asia-Pacific was a reflection of the region’s resilient recovery from the pandemic and its growing middle class, which is increasingly traveling for both leisure and business.

Meanwhile, Latin America also recorded solid growth, with a 9.5% year-over-year increase in international demand. This was supported by a notable capacity increase of 11%. The region’s steady recovery from the pandemic and increasing economic stability contributed to the strong performance of airlines operating in this region. Africa also saw growth, with demand rising by 9.5%, accompanied by a 10.6% increase in capacity. These figures highlight the emerging demand for air travel in these regions, as more people in Africa and Latin America take advantage of improved connectivity and growing economies.

Europe followed with a modest 3.4% rise in demand, which was accompanied by a 4.8% increase in capacity. While the demand in Europe was lower compared to other regions, it still represented a healthy increase, driven by both business and leisure travelers. European airlines have benefited from a return to international travel, as borders have reopened and demand for flights to major cities such as London, Paris, and Frankfurt continues to rise.

North America was the only region to experience a decline in air travel demand in May, with a 0.5% drop in international traffic. The decline was driven primarily by a 1.7% decrease in domestic traffic within the U.S., with lower demand for both leisure and business travel. This decline was further exacerbated by the ongoing economic uncertainty, including factors such as inflation, which has impacted consumer spending. Despite these challenges, North American airlines have still maintained a stable capacity, with a 2% increase in available seat kilometers, although this was the lowest capacity increase among all regions.

Brazil, however, stood out as one of the success stories in May 2025. The country recorded an impressive 18.3% increase in air travel demand year-over-year, with a corresponding 15.7% rise in capacity. This surge in demand reflects the strong economic recovery in Brazil, as well as the country’s growing importance as a key travel hub in South America. The increase in traffic was primarily driven by both domestic travel and increasing international connections, especially to and from Europe and the U.S.

In contrast, Japan reported a slight decline in capacity, with a 1.1% drop in available seat kilometers compared to May 2024. This reduction in capacity is partly attributed to the country’s slower recovery in air travel demand, as international travel has not fully rebounded to pre-pandemic levels. Despite this, Japan’s aviation market remains an important part of the broader Asia-Pacific region and continues to be a critical hub for international flights.

Conclusion and Outlook for 2025 and Beyond

Looking ahead to the rest of 2025 and into 2026, the global air travel market is expected to continue its recovery, albeit at varying rates across regions. While North America faces challenges with rising costs and fluctuating demand, regions like Asia-Pacific, Latin America, and Africa are expected to see sustained growth in demand, supported by rising middle-class populations and expanding economies.

As airlines prepare for the Northern summer travel season, consumer confidence and robust forward bookings offer a reason for optimism. However, geopolitical instability and economic uncertainties remain factors to monitor, as these can influence both demand and operational costs for airlines. The aviation industry will also continue to invest in sustainability and technological advancements, ensuring that the sector can meet future challenges while maintaining a focus on passenger satisfaction, cost efficiency, and safety.

In conclusion, while North America’s air travel demand faces some challenges, global demand for air travel in 2025 is on an upward trajectory. With strong growth in Asia-Pacific and other emerging regions, the aviation industry is poised for continued expansion, driven by evolving consumer expectations and the need for connectivity in an increasingly globalized world.