Ascend presentation to World Routes Strategy Summit Sep 2016
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Transcript of Ascend presentation to World Routes Strategy Summit Sep 2016
flightglobal.com/consultancy
Market Growth:
Constraints & Opportunities
25th September 2016
Richard Evans
1
flightglobal.com/consultancy 2
Focus on China & Asia
Compare & contrast with other regions
What factors impact growth?
Where are the opportunities?
flightglobal.com/consultancy
Asia has huge growth potential
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Malaysia Thailand Indonesia Vietnam China India UK
GD
P/c
ap
ita (
$)
Se
ats
/mo
nth
/’0
00
he
ad
Seats per thousand pop'n GDP per capita
China appears under-served, compared to other Asian countries
Source: FlightGlobal schedules, World Bank
flightglobal.com/consultancy
Airline fleet composition varies widely by region
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Africa Asia Pacific Europe Latin America Middle East North America
Nu
mb
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of
air
cra
ft in
se
rvic
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Regional Turboprops Regional Jets Narrowbody Jets Widebody Jets
Far fewer regional jets in Asia, but more twin-aisles
Source: Flight Fleets Analyzer, Passenger/Combi/QC usage.
flightglobal.com/consultancy
Airline fleet composition varies widely by region
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This shows up more clearly in terms of fleet percentage
Source: Flight Fleets Analyzer
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Africa Asia Pacific Europe Latin America Middle East North America
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f fl
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t in
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rvic
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Regional Turboprops Regional Jets Narrowbody Jets Widebody Jets
flightglobal.com/consultancy 6
Asian sub-regions also show key differences
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China Indian sub-continent SE Asia Australasia NE Asia
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Regional Turboprops Regional Jets Narrowbody Jets Widebody Jets
China has very few regional aircraft, and surprisingly few WBs
Source: Flight Fleets Analyzer
flightglobal.com/consultancy 7
Widebody usage has declined
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2006 2011 2016 Backlog 2006 2011 2016 Backlog
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f fl
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Regional Turboprops Regional Jets Narrowbody Jets Widebody Jets
Trend has been to single-aisles, driven by Intra-Asian growth
Asia, excluding China China
Source: Flight Fleets Analyzer, Flight Ascend Consultancy analysis
flightglobal.com/consultancy
Rapid capacity growth on many Asian routes
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More frequencies, but little aircraft size increase
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Asia-N Am Asia-WEurope
China-NAm
China-WEur
China Dom. China-Int'l CTU-all PEK-Dom. PEK-Int'l IndonesiaDom.
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ea
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ht
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ual g
row
th 2
00
9-1
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Frequency Growth Size growth Distance growth Av seats 2009 Av seats 2016
Source: FlightGlobal schedules data, Aug 2009 to 2016
flightglobal.com/consultancy 9
Top 5 airports in each region now a similar size
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PEK HND HKG PVG CGK ATL LAX ORD DFW JFK LHR IST CDG FRA AMS
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he
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ats
de
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m)
All 15 airports handling >55 million passengers per year
Asia N America Europe
Source: FlightGlobal schedules data, Aug 2016
flightglobal.com/consultancy
Asian airports have lower concentration of airlines
Typically less dominated by one hub airline – less transfer traffic
PEK
PVG
HKG
CTU
CGK
BKK
HND
LHRFRA
CDG
IST
DFWATL
ORD
LAX
Source: FlightGlobal schedules data, number of seats offered Aug 2016
flightglobal.com/consultancy
Intra-Asian capacity/service level examples
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Air China China Southern China Eastern Cathay/Dragonair Korean Air Garuda
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PEK
SHA
CTUICN
HKG
PVG
CAN
Chinese hubs using similar aircraft sizes & frequency levels
CGK
Source: FlightGlobal schedules data, Aug 2016, bubble size proportional to no.of destinations served
flightglobal.com/consultancy
Intra-Asian capacity/service level examples
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Dep
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ure
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ee
k/r
ou
te
Average seats/departure
Air China China Southern China Eastern Cathay/Dragonair Korean Air Garuda Delta
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PEK
SHA
CTUICN
HKG
PVG
CAN
US hubs use smaller aircraft, but offer much higher frequency
CGKATL
Source: FlightGlobal schedules data, Aug 2016, bubble size proportional to no.of destinations served
flightglobal.com/consultancy
Chinese airports suffering from delays
Sc
he
du
led
flig
hts
/mo
nth
On-time departure
SHA
Prime cause is ATC capacity constraints
Source: FlightStats, April 2016
flightglobal.com/consultancy
<5
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Aircraft size distribution at major airports
Opportunity exists to move to larger NBs or small WBs
Atlanta: 2500 flights per day, 5 runways
Beijing Capital: 1650 flights, 3 runways
Heathrow: 1350 flights, 2 runways
Source: FlightGlobal schedules data, Aug 2016
flightglobal.com/consultancy
Intercontinental routes from China
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Routes to Europe & N America, Aug 2009
Source: FlightMaps Analytics, flights >5000km
flightglobal.com/consultancy
Intercontinental routes from China
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Routes to Europe & N America, Aug 2016
Source: FlightMaps Analytics, flights >5000km
flightglobal.com/consultancy
Intercontinental routes from China
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New routes, flown in Aug 2016 but not in Aug 2009
Source: FlightMaps Analytics, flights >5000km
flightglobal.com/consultancy 18
Conclusions
Most countries in Asia are still in the relatively early stages of air transport development
Liberalisation is ongoing, but still much government involvement in
airlines/airports/ATC/fare levels
Airline consolidation likely over the coming decade
Initially domestically, as competition leads to over-provision of air service in some
markets
Regional / international consolidation more complex
In terms of constraints, runway/terminal capacity is being provided, but ATC is usually the
limiting factor in more developed markets
Opportunities for optimisation of networks, more transfer traffic at new airports, upsizing of
aircraft to help alleviate congestion, and new long-haul connections as economies grow
flightglobal.com/consultancy
Thank you
Richard [email protected]
Tel: (44) 7717 730933
19
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