Yangon Mingaladon Airport

South Korea's Asiana targets growth in 2013 within Asia, in advance of big long-haul growth in 2014

One of the highest growth rates in North Asia in 2013 will be from South Korea's Asiana, which is projecting a 9% increase in RPKs. This compares to 4% RPK growth at Korean Air and modest growth from All Nippon Airways and Japan Airlines. Many Chinese carriers will have similar or higher growth, but notably Air China will be lower as it runs out of slots.

The focus in 2013 for Asiana, globally the 54th largest airline based on capacity and sixth largest for intra-Asia international capacity, is regional flights, increasing capacity to cities including Chongqing and Yangon and launching new services to Denpasar and Jakarta. This traffic will help feed its long-haul network, due to commence notable expansion beginning in 2014 as A380s replace 777-200ERs, facilitating their re-deployment to new routes.

Myanmar’s first LCC Golden Myanmar prepares to enter international market

Golden Myanmar Airlines is planning to launch services to Singapore on 5-Apr-2013, the first phase of the start-up carrier’s plan to build an extensive international network. The expansion at Myanmar’s first home-grown LCC will further drive up growth in Myanmar’s dynamic international market, which has seen a 67% increase in seat capacity over the last year.

Myanmar recorded 33% growth in international passenger traffic in 2012 and 16% growth in domestic passenger traffic. Even faster international growth is expected in 2013 as several new foreign carriers entered the market in 2H2012 and as a number of new routes are added this year from Myanmar’s two international airports, Yangon and Mandalay.

Local carriers also are responding to the favourable market conditions by growing domestically and internationally. Myanmar’s LCC penetration rate, which is the lowest among the largest seven Southeast Asian countries, will continue to rise in 2013 as Golden Myanmar and foreign LCCs expand.

Nok Air prepares for IPO in 3Q2013 with international expansion, starting with two Myanmar routes

Thailand’s Nok Air plans to pursue fleet and network expansion as it seeks to raise about USD100 million through an initial public offering (IPO). The planned 3Q2013 IPO is one of several milestones for Nok in 2013 as the low-cost carrier resumes international services, initially with flights to Yangon and Mawlamyine in Myanmar. Nok will also take delivery of additional 737-800s, completing in 2013 the phase-out of its 737-400 fleet, which it has been operating since launching services in 2004.

Nok, which is partially owned by Thai Airways, has traditionally been a relatively conservative and low profile carrier. It has not been shy to contract during challenging periods and has never been concerned about establishing an international profile, instead focusing on building a strong local brand in the Thai market. But Nok’s steady profitability and strong position in a growth market should allow for a successful IPO and could eventually lead to significant international expansion.

Myanmar poised for more rapid growth in 2013 as foreign carriers expand and local LCC launches

Another year of rapid growth is expected in the Myanmar market as international and domestic carriers continue to expand in response to growing business and leisure demand. Myanmar’s international market has already recorded a 64% capacity increase in the nine months since Aung San Suu Kyi’s National League for Democracy won landmark elections in Apr-2012, leading to the rapid opening up of the Southeast Asian country and the lifting of economic sanctions.

Eight foreign carriers have since launched services to Myanmar while several carriers which already served the country added capacity. Following the 09-Jan-2013 addition of Dragonair, Myanmar is now served by 21 foreign carriers which account for about 80% of total capacity to and from the country.  

International carriers will continue to expand their operations to Myanmar in 2013 although at a more modest level as it will take time for the capacity added in 2H2012 to be absorbed, particularly given the shortage of hotel rooms and other infrastructure constraints. However, 2013 could see more rapid domestic growth as the country’s six existing domestic full-service carriers look to profit from growing demand for travel within the country and Myanmar’s first low-cost carrier, Golden Myanmar Airlines, enters the market.

Myanmar set to become Asia’s next big aviation growth market

Myanmar’s aviation market is poised to enter a major period of growth as the country begins to open up following landmark elections earlier this month that were won by Aung San Suu Kyi’s National League for Democracy. The election was seen as a turning point for Myanmar, formerly known as Burma, and the start of a more favourable business environment, including for aviation. Several Asian carriers and airport operators have identified near-term opportunities in Myanmar. The opportunities for all types of carriers – local and foreign, domestic and international, low-cost and full service – face no limitations in the medium term as the Myanmar market is now the most underserved market in ASEAN and perhaps all of Asia.

Myanmar’s two existing international airports, at Rangoon and Mandalay, are to be partially privatised while a recently opened new airport at the new capital of Naypyitaw will soon start to handle international flights. There are also plans for upgrading several domestic airports, many of which lack basic infrastructure.