Asian airlines post a strong finish to 2017

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January 05, 2018
Asian Airlines strong passenger growth
Photo: Cathay Pacific

Asian airlines posted a strong finish to  2017 with preliminary figures showing the number of international passengers flying on key carriers in November was almost 9.3 per cent higher than the previous year.

Preliminary numbers released by the Association of Asia Pacific Airlines (AAPA) showed “robust demand’’ for its members  in both international passenger and air cargo markets as the region benefited from ongoing improvements in the global economy.

The November surge brought the growth in international passengers carried by Asia carriers to to 6 per cent for the first 11 months of the year.

The AAPA said the growth in passenger numbers, which nudged 26 million for the month.   was boosted by strong demand in both the business and leisure markets.

Demand, as measured by the industry standard of revenue passenger kilometres (RPK), increased by 9.4 per cent and was ahead of a 7.3 per cent growth in available seat capacity.

This led to fuller planes with the average international load factor rising 1.5 percentage points to  78.8 per cent for the month.

AAPA said a solid expansion in new business orders, underpinned by strong demand from advanced economies, helped support further growth in air cargo volumes for the region’s airlines that translated into a 9.2 per cent rise in freight tonne kilometres.

This significantly outpaced the 4.7 per cent expansion in freight capacity to boost the average international freight load factor by 2.9 percentage points to 69.4 per cent in November.

“With business and leisure travel demand spurred by steady growth in the global economy, the first eleven months of the year saw a healthy 6 per cent ncrease in the number of international passengers carried by Asian airlines to a combined total of 288 million,’’ AAPA director general Andrew Herdman said.

“Within the same period, international air cargo demand increased by 10.0 per cent on the back of the firm pick-up in global trade activities.”

Mr Herdman said he expected 2017 to end on a positive note for both passengers and cargo traffic.

“With the global economy riding on positive business and consumer confidence levels amid continued expansion in order books, the demand outlook for Asian carriers remains positive,’’ he said.

“In the meantime, the region’s airlines remain focused on effectively managing capacity in response to evolving patterns of market demand as well as improving operational efficiency.”

Expectations for airlines in 2018 remain high with the International Air Transport Association in December predicting passenger numbers would increase globally by 6 per cent in 2018 to 4.3 billion while global profits hit $US38.4 billion.

But a report by the CAPA Centre for Aviation has warned airlines could be buffeted by higher oil prices after enjoying a profitability “sweet spot” in 2017.

AAPA members represent a strong cross-section of Asian airlines including All Nippon Airways,  Asiana Airlines,  Bangkok Airways, Cathay Pacific Airways,  China Airlines, EVA Airways,  Garuda Indonesia, Japan Airlines,  Korean Air,  Malaysia Airlines and Singapore Airlines .