Analysis Reports

The latest escalation centred on Iran has rapidly shifted from a regional security crisis to a systemic event with global ramifications.

What initially appeared to be another episode of Middle East volatility, has instead exposed the degree to which the modern air transport system is structurally dependent on a narrow geographic corridor linking Europe, Asia and Africa.

Within hours of the first military actions, multiple states enacted partial or full airspace closures, triggering thousands of cancellations, widespread diversions and a complex web of crew and aircraft dislocations.

Short term impacts - mass cancellations, airspace closures and cascading delays - are severe and quantifiable.

But the deeper effect is strategic: the episode exposes a fragile dependence on a single geographic crossroads, and could force a re-evaluation of network design, fleet strategy, insurance economics and hub resilience.

Asia Pacific aviation is entering a decade defined as much by workforce constraints as by traffic growth. Forecasts pointing to a requirement for more than 400,000 additional aviation professionals highlight a structural challenge that extends well beyond cyclical labour shortages.

Airlines across the region already struggle to recruit and retain pilots, engineers, cabin crew and digital specialists, even as fleet expansion and network growth accelerate. This widening gap between demand and supply raises fundamental questions about the sustainability of the region's growth trajectory.

This session from the CAPA Airline Leader Summit - Asia examines the workforce implications of Asia Pacific's expansion in a changing labour market.

It explores whether aviation's traditional value proposition still resonates with younger generations, how shifting expectations around work-life balance, career mobility and purpose are reshaping recruitment, and why training pipelines are failing to scale in line with demand. The discussion also considers the growing role of automation, AI and digital tools in alleviating pressure on scarce skills, while acknowledging the limits of technology as a substitute for human expertise.

The session reframes workforce strategy as a central pillar of competitiveness and resilience. Talent shortages are no longer a temporary constraint but a defining strategic risk, shaping fleet plans, network development and service quality. It provides a structured lens through which to assess how airlines can reposition themselves as employers of choice, build more resilient talent ecosystems and compete effectively for scarce skills in an increasingly global labour market.

For several years now the Kenyan Airports Authority (KAA) has intended to expand Nairobi's Jomo Kenyatta Airport quite considerably, by modernising existing terminals, building a new one and adding a second runway.

It was needed for two reasons - firstly, because capacity had been exceeded, and secondly, because the main terminal building opened in 1978, which is almost 50 years ago.

That said, Nairobi has lost its way a little as a gateway to and hub for East Africa, mainly to Addis Ababa, but there are new challengers on the horizon as well, such as the Bugesera airport project in Rwanda.

India's Adani Airports applied to improve the infrastructure in Mar-2024, by way of a 30-year lease agreement, but that proposal met stiff opposition due to concerns about transparency and terms, and the Kenyan government officially terminated the agreement on 24-Feb-2026.

Now the government will go it alone, but not completely, as it will seek private sector collaboration on individual projects such as a new terminal building by way of public-private partnerships. Adani could apply, but it has set its stall out as a whole airport operator - so that is unlikely.

This report looks at the options for reconfiguring the terminals in the light of changing demand, and the fact that two new airports in nearby countries will offer very tough opposition.

And in a late development just before publication the Airports Authority has issued a tender for the construction of new facilities and upgrades to existing infrastructure while confirming that an 'airport city' and special economic zone will be built.

Approximately one year after former Canadian Prime Minister Justin Trudeau urged the country's residents to avoid travelling to the US, Canadians continue to heed that call - and Canadian airlines continue to redeploy transborder capacity into more promising markets - particularly Latin America and the Caribbean.

Despite still-robust geopolitical tensions between the two countries, and declining passenger numbers in the transborder market, the US remains strategically important to Canadian airlines.

Look no further than Air Canada's sixth freedom success and the decision by Porter Airlines to add new flights, even as demand remains below historical levels.

The push by Canadian airlines into Latin America appears to be paying off as those operators, reflected in positive statements from those airlines about their prospects in the region.

The arrival of the A321LR and XLR have greatly expanded the possibilities for the A321neo family. With increasingly complex deployments, A321neos worldwide are being configured with ever more varying approaches.

Such a rapid pace of changes is leading to various untested concepts that are only beginning to face real-world guest feedback.

In this regular bi-monthly analysis, CAPA - Centre for Aviation will deep dive on two recent consumer backlashes associated with the A321neo family.

The US-Israeli air attacks on Iran, launched on 28-Feb-2026, and subsequent attacks by Iran on a range of targets across the Middle East has consequences for commercial aviation in Europe.

The region is the biggest intercontinental region by seats from Europe and the second biggest (after North America) by ASKs. European airline exposure to the Middle East is nevertheless fairly low as a percentage of total capacity.

However, the conflict is likely to have a number of impacts on European airlines. These include the closure of airspace and the suspension of flights to many Middle East countries and a possible lasting impact beyond the conflict if sentiment towards air travel remains more cautious.

In addition, oil prices (and fuel costs) are rising and there will be longer flights on some Europe-Asia routes that overfly the Middle East.

There may also be some positive effects on bookings on direct Europe-Asia routes where Middle East hub connections are suspended and on air cargo prices.

Collectively, Istanbul's two airports comprise the busiest two in any one single city in Europe, and almost in the world, testimony to the outrageous development of air transport and tourism there (to, from, and via) in the last two decades.

While most of the attention is on Istanbul Airport, the secondary level one, the wholly privatised Sabiha Gökçen International Airport, has long punched above its weight. It has had a consistent and very solid growth in passenger numbers that was interrupted by only one year; the first COVID-19 pandemic year of 2020.

With almost 17% growth in 2025, passenger numbers in that year were 36% higher than in 2019, which is almost unheard-of, and the highest known rate in the world for a major commercial scheduled airport.

With a second runway in place and talk of 90mppa (50mppa should easily be achieved in 2026), the attention now turns to 'Terminal 3', construction of which should begin this year; '3' actually being a misnomer.

Istanbul is in the process of becoming arguably the most connected two-airport city in the world, and Sabiha Gökçen's role in that will not diminish any time soon.

Lufthansa Group and Air India's planned joint business agreement (JBA) would be the first such agreement in the airline industry since Lufthansa Group and Singapore Airlines deepened their commercial relationship in 2017.

India is Lufthansa Group's second most important intercontinental market after the US, and Europe is Air India's most important region outside Asia. Lufthansa Group is the number two operator by seats on routes between Europe and India, where Air India is the market leader.

The two partners have a long history of commercial collaboration through codeshares and Star Alliance membership. The JBA will take this relationship to a much deeper level, comprising network expansion, joint sales and marketing, coordination of schedules and networks, and greater loyalty scheme integration.

This step is timed to build on the recently concluded talks over a new European Union/India free trade agreement. This should help to stimulate greater demand for aviation between Europe and India - which is the world's biggest nation by population, and which is underpenetrated by air travel.

After taking delivery of the 500th aircraft in the group fleet in the latter part of 2025, Turkish Airlines has articulated a vision to reach a fleet of 1,000 aircraft by 2036.

The group, founded in 1933, had to wait 73 years to receive its 100th aircraft in Aug-2006. It received its 300th aircraft less than 10 years later, in Feb-2016, and it took delivery of its 400th as recently as Mar-2023.

Turkish Airlines' fleet was small compared with Europe's big three legacy airline groups 20 years ago, but it is now approaching their size.

Its expansion can be attributed to its recognised product and service quality and very efficient unit costs, which both underpin its global connecting strategy.

At the CAPA Airline Leader Summit - World in Dec-2025, senior industry leaders listened as one of aviation's most pressing challenges: how to deliver ever more powerful, efficient, and sustainable propulsion systems without compromising durability, reliability, or public trust was discussed.

This interview with Luke Mallows, Senior Vice President Marketing & Lessors at Rolls-Royce placed the spotlight firmly on the evolution of modern widebody engines, framed through the remarkable journey of the Trent 1000 programme at the OEM.

As aircraft engines have grown more capable, their operating environments have become more extreme. The technical demands placed on today's propulsion systems are extraordinary feats of engineering that leave little margin for error.

Against this backdrop, the Trent 1000 story offers invaluable lessons on design philosophy, materials science, testing regimes, and the importance of real-world operational feedback.

This session explored how early durability challenges reshaped engineering processes, supply chain engagement, and airline collaboration. It also looked ahead to a future defined by sustainability, digitalisation, and increasingly complex propulsion architectures.

The discussion moved beyond technical fixes to examine how leadership, culture, and innovation frameworks are evolving to meet these demands.

This conversation provided rare insight into how one of the world's leading engine manufacturers is recalibrating its approach - not just to repair an engine programme, but to redefine how propulsion systems are conceived, tested, supported, and continuously improved.