Analysis Reports

The UK Climate Change Committee (CCC), which advises the government, published its advice on the nation's Seventh Carbon Budget (2038 to 2042) on 26-Feb-2025.

Aviation's path to net zero in 2050 requires growth in the consumption of sustainable aviation fuels (SAF), improved operational efficiency, new propulsion technology, demand management, and paying the cost of "engineered removals" to offset its residual emissions.

A key theme of the CCC report is the role of demand management while SAF availability grows. To some extent this will happen naturally, as the costs of decarbonisation feed through to higher fares and lower demand.

However, the CCC notes that further demand management measures may also be necessary, including additional taxes and charges and limiting airport expansion. Its 'citizens' panel' expressed support for such measures.

The coinciding of the CCC report with recent UK government support for new runway capacity at both Heathrow and Gatwick is somewhat ironic. Expect renewed resistance to airport expansion from environmental groups, local politicians and local residents.

CAPA ANALYST PERSPECTIVE - the continuation of a series where CAPA - Centre for Aviation's analyst team provide their personal views on a hot topic facing aviation around the world.

In a flurry of activity around airport expansion - once anathema to the current Labour government in the UK - a scheme for the expansion of London Stansted Airport and one for the addition of a third runway at London Heathrow have been rapidly approved by that government, coming on top of a probable authorisation soon for the expansion of London Luton Airport.

And now the Transport Secretary declares herself to be 'minded' to approve a second runway at London Gatwick Airport, which would increase capacity there to 75mppa.

There are still large pockets of resistance to most of these proposals, and protesters can be expected to come back out of the woodwork soon, in big numbers.

But there is another aspect to this that begs attention; namely that despite the theoretical support given by most of the UK's main political parties to improving transport in the English regions and Scotland, Wales and Northern Ireland - little has been forthcoming in reality.

Although some airports, notably Manchester, don't seem to need more government support, there are others that would not only benefit from it, but could help reduce the burden on London.

To ignore them might prove to be a costly political mistake.

IndiGo has applied for slots at Amsterdam Schiphol Airport in order to launch daily connections with Delhi and Mumbai. It is also thought to be considering other major Western European destinations, such as London and Paris, although Manchester has been confirmed alongside Amsterdam for its initial services.

A new widebody wet lease contract with Norse Atlantic Airways could accelerate the low cost airline's long haul expansion ahead of the 2027 delivery of its own Airbus A350s.

Europe-India capacity has recovered well from the COVID-19 pandemic, with 2024 seat capacity reaching a record high and growth scheduled to continue in 2025.

However, the market has significant untapped potential.

If IndiGo is successful in launching its first services to Western Europe, this could help to stimulate further growth in this under-served market.

Air Serbia received its fourth A330-200 on 11-Feb-2024, giving it a quartet of widebodies for the first time in its history.

The airline offers four long haul destinations (two in China and two in the USA) and is considering more, although its principal activity is providing connectivity between Serbia and European destinations.

Fleet and traffic growth took Air Serbia to its highest ever passenger numbers of 4.4 million in 2024. It expects traffic to grow by 6% in 2025 to a new high of 4.7 million, which would be 67% more than its 2019 total.

In the aftermath of the COVID-19 pandemic, Serbia's biggest operator has increased its seat share in the country, while low cost airline share has been eroded. Its record financial results for 2024 demonstrate that profitability is central to Air Serbia's expansion plans.

All Nippon Airways' parent ANA Holdings has announced plans for major orders of widebody and narrowbody aircraft, which will help fulfil the group's international growth ambitions and continue the refresh of its domestic fleet.

The prospective orders (including new options and option conversions), revealed on 25-Feb-2024, cover nearly 100 aircraft from three manufacturers.

ANA Holdings' board has approved the orders, and purchase agreements with manufacturers are expected to be signed between Mar-2025 and Jun-2025.

The announcement is significant, not just for the volume of aircraft involved, but also for what it indicates in terms of fleet and network strategy.

Widebody orders show that ANA is doubling down on its international expansion drive. And its narrowbody orders are aimed more at replacement than growth, highlighting the slower growth rate expected to prevail in the domestic market.

New aircraft types included in the orders are also interesting - long-range narrowbodies point to an enlargement of LCC Peach's role, and the addition of Embraer regional jets will give the group greater flexibility in matching aircraft to domestic routes.

Many countries across the world have been through the mill of identifying a location for a major new airport, even when it is clear as day that one is needed urgently.

During the first quarter of this century passenger traffic at Lisbon's Humberto Delgado Airport in Portugal's capital city has grown from nine million to over 35 million each year, and up to 100 million annual passengers were expected by 2050, which it simply couldn't handle.

Expanding Humberto Delgado would be very difficult, as it is constrained by suburban developments, but securing a location for a long term replacement has been equally demanding as original proposals dating back decades were shelved, only for one of them to make a surprise return.

Now, a new airport will be built by 2034 on a military firing range close to a bird sanctuary (what could possibly go wrong?), although the procedure remains at an early stage, and formal proposals are not required for three years.

The question posed in this overview of events does not concern the location, though; rather it asks if the contract to build and operate it should have been handed on a plate to the existing private sector operator, or whether other capable organisations should have been afforded the opportunity to stake their claim.

And also it asks if there is any option for Humberto Delgado to retain an aeronautical role, rather than to be confined to history.

This regular CAPA - Centre for Aviation report provides a summary of major developments in the aircraft interiors sector, supported by data from the CAPA - Centre for Aviation Aircraft Interiors Database and CAPA - Centre for Aviation News.

This edition covers Jan-2025 and Feb-2025 and features:

• Starlink's rapid growth and the changing IFC market;

• Region Focus: North America;

• Latest global interior updates.

Macau, a special administrative region of China situated in the Greater Bay economic region (and close to both Hong Kong and the Chinese mainland), would probably have a bigger regional airport hub were it not for the presence of Hong Kong, to which it is connected by a bridge.

But Macau offers what is the probably the world's biggest draw to visitors in the form of its gambling facilities - it is the largest venue, as measured by gambling revenues.

While the Chinese continue to travel in droves (and they are now doing again, after the COVID-19 pandemic), Macau's single-sector economy will continue to thrive, and despite the improving offers being made by the Philippines and Indonesia.

In the longer term its future is tied up with the progression of the Greater Bay area, the world's largest economic region, and how Macau fits into the vision for its further development.

During the past few weeks, looming threats by the US of tariffs on goods in two of the country's most important air travel markets - Canada and Mexico - have already resulted in some airlines working to de-risk their operations from the potential economic unrest.

Now the administration of President Trump has once again delivered a firm date of 4-Mar-2025 for tariffs to begin.

It is yet to be revealed whether charges will ultimately take effect, or remain a negotiating tactic by the US, but either outcome could impact air travel demand in those key markets.

Dublin Airport dominates Ireland's aviation market, accounting for 84% of scheduled seats in the country in 2024. It has been central to Ireland's economy and success as an aviation market for 85 years since its first flight in Jan-1940.

Ryanair, Ireland's and Dublin's leading airline, has announced a record summer schedule at Dublin, following the temporary suspension of Dublin Airport's traffic cap of 32 million annual passengers for summer 2025.

However, beyond this, uncertainty remains while the European Court of Justice reviews the cap and pending applications to increase it.