Outlook 2023: Asia-Pacific airlines return to growth: part one – Southeast Asia & China

For airlines in the Asia-Pacific region, 2023 should be the year that international capacity returns almost to pre-pandemic levels.

But even though COVID-19 restrictions have eased, there are still some major hurdles on the path to recovery that the industry must overcome.

Asia-Pacific airlines have generally lagged those in other global regions in terms of international capacity recovery. While the post-pandemic rebound has been slower to start in Asia-Pacific, this also means there is greater scope for rapid improvement in this region than elsewhere.

Recovery challenges include volatile fuel prices, inflation, the possibility of global recession, uncertainty regarding the reopening of on the important mainland China market, and system bottlenecks caused partially by workforce shortages.

There is also uncertainty about what travel demand will look like as 2023 progresses.

Demand is strong now, due to a combination of pent-up appetite to travel after the pandemic and a shortage of capacity. But in 2023 both these factors will ease.

Part one of this analysis will examine some data points for the broader region, as well as identifying some themes to watch in the Southeast Asia subregion and in China.

Part two will focus on the outlook for the Northeast Asia, Australasia and India markets.