Russian airline consolidation has reached a plateau

Russia was Europe's number seven aviation market by seats in 2018, after the big five Western European countries (UK, Germany, Spain, France and Italy) and Turkey. Seat numbers in the Russian market grew by 11% in 2018, faster than in any of the other top seven countries.

As with elsewhere, passenger traffic growth is related to GDP growth in Russia, but with a much higher multiplier compared with the global market. Although geopolitical and macroeconomic factors have sometimes dented demand for international air travel to/from Russia, its domestic market has enjoyed robust and reliable growth for several years.

After the collapse of the former number two airline Transaero in 2015, which accelerated the Aeroflot-led consolidation of Russia's airline industry, the top five became a top four.

Aeroflot Group remains Russia's leading airline group by some distance, followed by S7 Group, Ural Airlines and UTair Group. LCC share is small, but growing, led by Aeroflot subsidiary Pobeda. However, the consolidation process appears to have reached a plateau.