TOKYO – Northwest Airlines is halting its direct flights from Osaka Japan’s second largest city to Saipan on March 1 although officials of the airline in Tokyo emphasize that they hope to resurrect the service in the future.

The route was only reopened one year ago and had contributed to increased numbers of visitors from Osaka but Hiroko Tanaka regional manager of Northwest’s corporate communications division in Tokyo said the economic situation made it impossible to continue at the present time.

"We took the decision to suspend the route from March 1 in response to the global economic recession and softening customer demand " she told the Journal. "However we continue to be committed to the Saipan market and we will continue our daily services from Nagoya and Tokyo’s Narita Airport."
The airline declined to give the numbers of passengers that had used the direct Osaka-Saipan service or revenues.

The route changes mean that passengers who previously flew direct to Saipan will now be required to fly from Kansai International Airport via Narita.
"We plan to review this situation as and when the economic conditions improve " Tanaka said. The airline presently operates daily flights to the island from Nagoya and two flights each day from Narita.

Northwest’s decision comes as less of a surprise in light of the latest figures released by the Geneva-based International Air Transport Association which has announced devastating drops in both passenger traffic and international cargo in November. And the situation in the Asia-Pacific region is recognized as the worst in the world.

According to the association global international passenger traffic declined 4.6% in the month while the figure for cargo was 13.5%. The international passenger load factors for November stood at 72.7% a decline of approximately 3 percentage points from the same month in the previous year.

"The 13.5%  drop in international cargo is shocking " said Giovanni Bisignani director general and chief executive officer of IATA. "As air cargo handles 35%  of the value of goods traded internationally it clearly shows the rapid fall in global trade and the broadening impact of the economic slowdown.

"By comparison this is largest drop since 2001 in the aftermath of Sept. 11 " he said. "The industry is now shrinking by all measures. The 1.0%  capacity cut in international passenger markets in November could not keep pace with the 4.6%  fall in passenger demand. We can expect deep losses in the fourth quarter."

The 4.6% decline in passenger figures in November is a considerable worsening from both the 1.3% contraction in October and the 2.9% fall in September the association said pointing out that Asia-Pacific carriers face "the most difficult operating environment."

The region witnessed a 9.7% decline in November following a 6.1% fall in the previous month. The region also had the most aggressive capacity cuts down 5.1%.
The association said it believes the weakness in both global trade and consumer confidence was behind the dismal figures.

In terms of freight Asia-Pacific carriers again bore the brunt of the decline with traffic collapsing by 16.9% in November. And as freight accounts for a larger percentage of revenues for Asia-Pacific carriers fourth-quarter profits for the region’s companies will be disproportionately – and negatively – impacted by the downturn in the global air freight market the association concluded.

"With no end in sight for the worsening global economy the 2008 gloom will carry over into the new year " Bisignani said. "Relief in the oil price has been outstripped by the falls in demand and capacity cuts are not keeping pace. The industry is back in intensive care. Improving efficiency everywhere will be the theme for 2009."