CAPA: Asia's budget airlines may have 20 per cent market share by end of decade
12 Mar 2007
Asia's budget airlines are set to expand their share of the regional aviation market to 20 per cent as compared to the less than one per cent they had in 2001, a report from Sydney-based Centre for Asia Pacific Aviation has said. According to the report, the strongest growth will be seen in India, Indonesia, Malaysia, Thailand and Australia.
The predictions are based on announced aircraft orders by Asian budget carriers which are now slated to increase their seat capacity sharply over the next few years, said Peter Harbison, executive chairman of the consultancy.
Harbison pointed out that even last year there was ample evidence of the budget carriers' phenomenal growth, with overall capacity up 55 per cent over 2005 even as full-service carriers only saw a 0.9 per cent increase.
"Based on recent LCC (low-cost carrier) growth rates and aircraft orders, their share could reach 20 per cent by the end of this decade, with much higher levels of penetration in such markets as India, Thailand, Australia, Malaysia and Indonesia," said Harbison, adding, "The LCC share in Asia was less than one percent in 2001."
The consultancy said that Asia's low-cost airline sector, particularly in Southeast Asia, has undergone remarkable growth in the last few years disproving initial skepticism that the region was not ready for no-frills air travel.
The phenomemal success of Malaysia's AirAsia, the leading budget airline in Southeast Asia, has sparked the set-up of similar outfits elsewhere.
Harbison also added that according to his estimates the region, and the Middle East, would need 10,200 pilots, 36,400 cabin crew, 26,800 maintenance engineers and 38,500 ground handlers over the next five to seven years.
