Middle East Aviation Outlook 2020: Growth to resume, modestly

For the first time in recent history, airline seat capacity in the Middle East will fall in 2019. After slowing from 12.6% in 2016 to 3.8% in 2018, annual seat count is to drop by 1.6% in 2019, according to OAG. The decline is focused on domestic markets and legacy airlines, while international routes and LCCs continue to grow.

The 737 MAX grounding has made a minor contribution to the capacity cut. The region's 19 grounded MAXs account for less than 1% of Middle East seats, 14 of these aircraft with flydubai and five with Oman Air (both were forced to cut capacity in 2019).

Qatar Airways is the sole Gulf big three airline to grow in 2019 and has more aircraft deliveries due in 2020 than the other two combined. Emirates cut capacity in 2019, taking a pause as it transitions its fleet and develops its relationship with flydubai.

Etihad also cut capacity in 2019, but is growing slowly in winter 2019/20. It continues with its codeshare strategy after the unravelling of its equity investments. Moreover, Etihad and Air Arabia are planning a new LCC for Abu Dhabi, and Etihad's working relationship with Emirates seems closer than ever before. Outside the Gulf three, Saudia's growth has levelled out, but its still-small LCC subsidiary flyadeal is still growing fast.

2020 promises another year of, at best, modest capacity growth for the Middle East.