A decade ago there were no LCCs in Asia Pacific, outside domestic Australia. In the 70-year history of modern aviation, that is a remarkably short period. Yet what has happened in those 10 short years has transformed the Asian airline industry beyond recognition.
A new government in New Delhi since May-2014 has brought heightened expectations of faster GDP growth, industry reforms and enhanced transparency. But with an entirely new team leading the Ministry and most of the government agencies involved in aviation, there is a lack of experience at the top. It will therefore take some time for the key decision-makers to grasp the complexity of the situation.
The Asia Pacific region is the world’s largest, accounting for the greatest amount of airport construction activity and a diverse range of projects. As of Sep-2014 there are more than USD172 billion of airport-related construction projects at existing airports throughout Asia Pacific (out of a global value total of USD518 billion, or 33.2%).
One of the key competitive dynamics in the aviation industry is the relative cost efficiency of different airlines, as measured by cost per available seat kilometre (CASK). However, a direct comparison of CASK, or unit cost, for different airlines is not straightforward as it varies with the average distance flown.
The function of revenue management has been a game changer within the global airline industry for more than four decades, allowing carriers to offset some of the negative factors associated with a perishable product, fixed capacity, high fixed costs and low variable costs. - By Nawal Taneja
2015 marks the self-imposed deadline for the 10-member Association of Southeast Asian Nations (ASEAN) to get its Single Aviation Market project in place. There is optimism that this will be met, though only because the 2015 goals are fairly modest in the first place. By Alan Khee-Jin Tan - Professor of Aviation Law, National University of Singapore
To appreciate the change in North Asian aviation, consider the number 25. China Eastern Airlines in Sep-2014 unveiled a new brand – its first in 25 years – that is designed to convey modernity and an internationally minded approach to coincide with significant long-haul growth. Taiwan last certified a new airline about 25 years ago, but by the end of 2014 expects to certify two new ones.
The Southeast Asian market has been impacted over the past year by overcapacity and political instability. But demand continues to grow and a recent wave of consolidation and capacity adjustments should lead to more favourable conditions.
South Pacific carriers have embraced virtual long-haul networks perhaps more than any other region, mostly thanks to the region’s unique geography. While Qantas and Emirates have paved the way for a seismic shift in how alliances are formed, Virgin Australia has steadily added to its partnership stable, now including Etihad, Delta, Singapore Airlines and Air New Zealand.