Centre for Asia Pacific Aviation (CAPA), a global organisation that provides the aviation industry with market intelligence, analysis and data, released a report last week warning of overcapacity as demand slows amidst uncertainties in the global economy while the region’s airlines continue to put new aircraft into service. That is compounded by a growing number of low-cost airlines beginning operation, as well as Gulf and Chinese carriers vying for larger shares of the market.
The report points out that Asia-Pacific airlines have 520 aircraft on firm order and scheduled for delivery in the next three years, with many of these new deliveries being additions to the carriers’ fleets and not replacements.
CAPA refers to figures from trade body Association of Asia Pacific Airlines (AAPA), which show that the region’s carriers served a record 190 million international passengers in 2011, a 3.5 per cent annual increase. But it was also the slowest pace of growth over the past three years.
Adding to the concern is the drop in air cargo demand, which declined by 4.8 per cent in 2011, showing weakening world trade conditions with Europe and the US still struggling to come out of one of their worst economic downturns in history. This figure echoes a comment made by Cathay Pacific chief executive John Slosar on December 12 last year. When delivering a keynote speech at a luncheon by Aerospace Forum Asia and Pacific Asia Travel Association, he said it felt like “someone has cancelled Christmas” as the year-end freight volume failed to pick up as expected traditionally for the festive season.
But AAPA also adds that, despite what is predicted to be a tough 2012, Asian airlines remain optimistic about long-term growth prospects.
For more information, visit www.centreforaviation.com.
More stories on the region's growing number of low-cost carriers can be found here.
Reggie Ho
