Virgin Atlantic's growth plans signal uplift in airline industry confidence

Virgin Atlantic is adding flights to the Caribbean from next year in a further sign of airlines' confidence of a recovery in the recession-hit industry.

From October 2011, Virgin Atlantic is boosting its Caribbean capacity by 20 per cent to nearly 22,000 weekly seats, with extra flights to Barbados, Cuba, Tobago and Grenada.

The expansion plans come alongside a widespread recovery in the industry. Globally, passenger demand shot up by 9.2 per cent and freight traffic by 22.7 per cent in July, the International Air Transport Association (Iata) said this week. Although the numbers are slightly lower than the 11.6 per cent and 26.6 per cent jumps recorded in June – because the market was already starting to recover in July last year – they are still well above the industry's average 6 per cent annual growth rate.

But Iata is warning that economic uncertainty and the threat of a double dip recession may yet undermine progress. "The recovery in demand has been faster than anticipated but the pace of the recovery will likely slow," Giovanni Bisignani, the association's director general said. "Further growth will be largely determined by consumer spending, which remains weak."