Association of Asia Pacific Airlines (AAPA) director general Andrew Herdman, speaking at CAPA's World Aviation Summit in Hong Kong, stated (28-Nov-2012) “Over the past decade, Asia has gone from being a destination market to being an outbound market. The centre of economic gravity is shifting from West to East”. Mr Herdman noted in terms of purpose of travel, leisure traffic is growing at a faster rate in Asia than elsewhere, with strong intra-regional travel growth which it outpacing long-haul travel and the industry average. He noted globally 8% of the people travelling across premium classes generate 25% of global revenue and in Asia, the proportions are around 10% and 30%, respectively. Mr Herdman also said he does not accept the notion full service carriers are neglecting the economy sector, stating full service carriers are trying to cater for this segment. He, however, conceded the LCC model is the "winning" business model in the market. LCC penetrations in Asia are around 12-15%, compared to the global average of 20-25%. LCCs are capturing around 12% of the global revenue it is around a USD630 billion. He also said alliance is a revenue generating synergy tool airlines use to work around regulation restrictions on cross border mergers and integrations.
Asia has grown to become an outbound market, LCC is the 'winning' business model in the market: AAPA
You may also be interested in the following articles...
Southeast Asia Fleet Outlook:
Southeast Asia, along with the Middle East, are the only two regions with as nearly as many aircraft on order as in the active fleet. Southeast Asian airlines currently have nearly 1700 aircraft on order compared to an active fleet of approximately 1800 aircraft.
Finnair and TAP Portugal: their location based long haul niche strategies compared
Both Finnair and TAP are based in peripheral corners of Europe: Finnair in the extreme northeast and TAP in the southwest. Both are based in countries with relatively small populations, but they have developed networks that capitalise on their geographic location to carry connecting traffic from across Europe and elsewhere to long haul destinations in other continents.
TAP's main long haul market is Upper South America (primarily Brazil), but it also has a secondary long haul niche in Africa. Finnair's main long haul market is Northeast Asia, with an additional presence in South and Southeast Asia. Both also operate to the US. On short haul, LCC competition has been a bigger threat to TAP than to Finnair, but cost savings are important to both.
TAP and Finnair have similar traffic volumes, unit costs and average trip lengths. Moreover, both have struggled to generate sustainable profitability. This report compares and contrasts Europe's two leading independent exponents of the location based long haul niche strategy. Both are set to accelerate their long haul growth.