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Indonesia: international aviation. Rapid growth and strong competition

Analysis

Domestic air travel dominates the Indonesian market, accounting for nearly 75% of total passenger traffic. However, international operations are gaining steam, driven by rapid inbound growth.

Indonesian airlines increased their international passenger traffic by 20% in 2017, outpacing domestic growth of 8%. Indonesian airlines flew more than 12 million scheduled international passengers in 2017 and Indonesian airports handled more than 34 million international passengers. Foreign airlines account for over 60% of international traffic, but Indonesian airlines have been gaining market share and are keen to close the gap.

Indonesia has emerged as a popular tourist destination, with visitor numbers increasing by 21% in 2017. China has become Indonesia's largest source market, driving rapid growth in the Bali-China market.

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