TUIfly

Europe's non-scheduled airlines in long-term structural decline, but Thomas Cook, TUI evolving

The market for non-scheduled (charter) passengers in the UK and across Europe is in structural decline and this appears to be confirmed by recent data from the UK Civil Aviation Authority. The main beneficiaries have been the low-cost carriers as holiday-makers have developed the habit of assembling their own self-made package of flights, hotels, car hire and other services. Nevertheless, there is still a role for integrated tour operators, particularly for specialist, long-haul and other niche holidays. This is illustrated by TUI Travel’s recently reported expectation of a 10% increase in profit for FY2013.

However, neither TUI Travel nor Europe’s other major listed tour operator, Thomas Cook, has any plans to expand its fleet and Thomas Cook has even indicated that it is considering an asset light model, making more use of third party capacity. The Thomas Cook group continues to focus on its restructuring, an important element of which is its recent decision to integrate its four airlines into one. This could also be a precursor to selling its airline eventually as the travel companies focus on their distribution and destination management skills.

United ends 2012 as world's biggest airline, Emirates third. Turkish and Lion Air the biggest movers

United Airlines, following its merger with Continental, has ended 2012 as the world's biggest airline measured by available seat kilometres for the current week, ahead of second placed Delta, whose capacity fell 0.3% year on year, according to Innovata. Fast growing Dubai-based carrier Emirates is the world's third biggest airline by this measure, and could be in second place by the end of 2013 if the past year's growth rates are maintained.

Southwest Airlines remains easily the largest LCC, while Lion Air and Jetstar have each climbed the LCC top 10, to sixth and seventh places respectively, overtaking Westjet. Atlanta Airport (just) remains the world's largest, ahead of Beijing Capital Airport, in terms of seat throughput for the week, but this ranking seems certain to reverse in 2013.

The biggest movers in the overall World Top 50 list include Turkish Airlines, which jumped seven places to rank 15th globally, while Indonesian carrier Lion Air vaulted eight places to enter the global Top 40 for the first time. Iberia and India's Jet Airways fell four and seven places in the 2012 rankings, respectively.

Global Airline Alliances collectively grew capacity at higher than the world rate, with SkyTeam expanding fastest of the three majors, although Star Alliance remains easily the largest.

World's largest airlines cautious with capacity. Some big moves in global airline rankings

Emirates is close to overtaking American Airlines and becoming the third largest airline by available seat kilometres (ASKs) after the Dubai-based carrier's massive 19% increase in capacity over the last year. Emirates' current capacity is close to 30% above levels of just two years ago, according to Innovata. Over the same period, American has cut capacity by about 8% while larger rivals United Airlines and Delta Air Lines have slashed ASKs by over 16%, according to Innovata. Interestingly, were American Airlines to combine with US Airways it would become the world's biggest airline - some 4% larger than Delta by ASKs based on Innovata capacity figures for Aug-2012.

The other big movers over the past two years include Ryanair, which has leapfrogged China Southern and US Airways into the Top 10, and Turkish Airlines, which has soared into 17th position (from 27th two summers ago) thanks to an astonishing 52% increase in ASKs. easyJet has also moved up several places to be just outside the Top 20, while Japan's ANA and JAL have fallen outside the top 20 grouping.