My Account Menu

CAPA Login

Register to trial CAPA Membership!

AAPA sees positive growth prospects for Asia Pacific carriers despite current industry challenges

22-Oct-2012 10:06 AM

Association of Asia Pacific Airlines director general Andrew Herdman, speaking at the International Aviation Club Washington DC stated (18-Oct-2012) airlines based in the Asia Pacific region have "established a reputation for customer service excellence, and have been steadily growing their regional and global networks". He continued, "Asian carriers are commensurate with the US carriers or EU carriers in terms of passenger traffic, and clear leaders in the world of air cargo". The growth prospects are also positive, with Mr Herdman noting "several Asian countries now have per capita incomes approaching developed Western levels, fundamentally changing consumer buying behaviour and the patterns of international trade. He also noted "Asia is home to two thirds of the world’s population, but generates only about one third of global economic output" and "income levels are steadily rising throughout the region, but we still see wide variations, from levels similar to those of Western developed countries at the high end, but, at the other extreme, many millions of people still lack access to clean water, and electricity". Mr Herdman also noted the global middle class currently includes around 2 billion people, or 30% of the world’s total population, with this projected to grow significantly, to over 3 billion in 2020, and 5 billion in 2030. "China, India and other Asian markets are driving that trend, with the region’s middle class set to grow six-fold over the next two decades," he said. While noting the challenges existing in the aviation sector, Mr Herdman stated "leading Asian airlines feature prominently in the rankings of international airlines by enterprise value, matching those of the already consolidated majors in the US and EU". [more - original PR]

Association of Asia Pacific Airlines:  "Half of the world’s future traffic growth over the next two decades will be to, from or within the Asia Pacific. As a result of faster growth rates, Asian airlines share of the overall aviation market is projected to increase to 32% of a much larger (today x 2.5) global market by 2030, compared to European airlines 24% and US carriers 20%. Asian airlines are also at the forefront of both business and customer service innovation. Leading Asian carriers are still investing heavily in further upgrading of premium products and services, particularly on long haul inter-continental routes. Notwithstanding the great success of the no-frills business model in serving short haul routes, it is worth noting that globally this segment of the business only accounts for around 15% of total industry revenues. Full service network carriers are expected to continue to play a key role in the international arena, and projected to still capture as much as 75% of global traffic in 2030. At the same time, several major Asian carriers have launched subsidiaries or associate airlines focusing on serving short haul regional routes using the no-frills budget carrier model. Low cost carriers have also been very aggressive in extending their reach across the Asia Pacific region through the establishment of localized joint ventures, whilst operating under a common brand and sales platform.  We have also seen the emergence of legacy carriers entering into innovative new joint ventures, such as Air Asia Japan with ANA and Jetstar Japan with JAL in Japan," director general, Andrew Herdman. Source: Company statement, 18-Oct-2012.