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Intra-Asia Market Eclipses North America as World's LargestFebruary 1, 2010 By: George Dooley
In 2009, intra-Asia-Pacific travel eclipsed the number of travelers in North America as the world’s largest aviation market, the International Air Transport Association (IATA) reports. Asia-Pacific travelers numbered 647 million compared to the 638 million who traveled within North America (including domestic markets). By 2013, an additional 217 million travelers are expected to take to the skies within Asia–Pacific, IATA says.
“Achieving Asia-Pacific’s tremendous potential is contingent upon short-term efforts to battle the impacts of the economic downturn with cost reductions and efficiency gains. Longer-term Asia-Pacific must also face global challenges including environment, security and liberalization,” said Giovanni Bisignani, IATA’s director general and CEO at the start of the Singapore Air Show Aviation Leadership Summit.
The global aviation industry is expected to reduce losses from $11.0 billion in 2009 to $5.6 billion in 2010, IATA said. The loss reduction is being led by Asia-Pacific’s carriers who are expected to see their losses shrink from US$3.4 billion in 2009 to $700 million in 2010. “Asia-Pacific’s prospects are improving faster than other regions,” said Bisignani, noting that the Asia-Pacific region is diverse, dynamic and with great potential.
"Asia-Pacific is home to two of the world’s top five airlines in terms of profitability," said Bisignani. "At the same time, the region’s governments provided over $10 billion in government bailouts to airlines in the first quarter of the year. The region’s two biggest growth markets—India and China—face completely different circumstances. India’s challenge is to reduce costs and improve infrastructure, while China is adjusting to new global trade patterns."
"Over the last decade China replaced Japan as Asia-Pacific’s largest player," said Bisignani. "Today China’s fleet is 1,400 aircraft compared to Japan’s 540. Its domestic market of 5.7 million weekly seats is more than double Japan’s 2.6 million and China’s 1.4 million weekly international seat market is now slightly larger than Japan’s 1.3 million."
In the U.S., there are three aircraft seats per year for each of the 300 million people who live there. China’s population of 1.3 billion is served by only 0.3 seats per person and India’s 1.1 billion population has only 0.1 seats available per person. “The global air transport industry will triple in size when Asians travel as much as those in the U.S.,” said Bisignani. “Asia-Pacific’s diversity, dynamism and potential are a great opportunity. Rapidly developing markets are defining aviation’s future. Is Asia-Pacific prepared for the challenges that this will bring?”
The region faces many challenges including security. “We live in a global world—global connectivity and global threats," said Bisignani. "Governments and industry must protect the connectivity and eliminate the threats. That challenge requires industry and governments to work together for effective and efficient security measures." Bisignani added that the industry must also define government/industry cooperation on security and find a better way to deal with the cost burden.