Jetrader - July/August 2012 - 12

should see ASEAN Open Skies become a reality by the current deadline of 2015. Cross-border ownership will unlock some exciting opportunities for airlines in the region. • China-Taiwan: This market was closed for many decades, but political changes (along with the commencement of Taiwan’s HSR) allowed ﬂights to begin in 2008. From zero only four years ago, this market should grow to more than 70 daily ﬂights and more than 15,000 seats per day by end 2012. In contrast, the demise of Taiwan’s domestic market has been profound, still, there has been plenty of incremental ﬂying given the longer cross straits average ﬂight distance. To date, China only allows a minority of provinces to send individual visitors, so this market remains substantially untapped. With the relaxation of the China-Taiwan market, Taiwanese carriers gained overﬂy rights over China, which was another stimulant for growth of non-stop ﬂights between Taiwan and Europe—over 10 percent annualised growth in the number of ﬂights from 2005 to 2012. • India: No longer a closed shop, Hong Kong is a key travel market for Indians. For more than 20 years, there was no increase in capacity between Hong Kong and India. This was rectiﬁed in 2007. From 2005 to 2012, ﬂights between India and the rest of Asia have grown at an annualized rate of 11.5 percent. • Cessation or decline of military activities: There’s nothing like a breakout of peace to stimulate air travel. Secessionist activity in Indonesia and the Philippines has declined over recent years, and ﬂights to these affected areas has rebounded accordingly. Regional airports have recorded strong growth from 2005 to 2012, such as Medan in Indonesia with 13.3 percent annualised growth, and Davao in the Southern Philippines with 10.4 percent. • Japan is rarely perceived as a growth haven within Asia. But the opening up of Haneda Airport has changed perceptions of Tokyo as a declining hub within Asia. Flights at Haneda have grown at 4.7 percent annualised from 2005 to 2012 and Tokyo (including both Haneda and Narita) have grown 3.8 percent over this same timeframe. Not bad considering the Japan’s anaemic economy. • We all hope that political reforms stay the course in Myanmar, as the tourist potential in this market is considered among one of the most signiﬁcant in Asia. The country has a prime geographical location, but it needs signiﬁcant investment in airport infrastructure. There’s likely to be a lot of willing support to provide this, as long as there is the domestic will to open up the country. Other forms of market liberalisation include: • October 2011: Open skies between Taiwan and Japan. • March 2012: Approval for downtown to downtown ﬂights between Taipei and Seoul. • March 2012: Myanmar signs up for ASEAN’s single visa rule for visitors. • April 2012: Vietnam partially relaxes visa issuance rules. • April 2012: U.S. increases the number of visas issued to PRC nationals (part of a much larger campaign by the U.S. travel trade to greatly improve the speed and reduce the cost of obtaining a U.S. visa).

between single aisle and twin aisle. Indeed, the sharp increase in the number of single aisle aircraft in Asia since 2000 reﬂects the rapid rise of domestic markets in China and India as well as LCC carriers, especially within ASEAN.

Global aircraft ﬂeets by region
As at year end 2000 In-service ﬂeet (100+ seats) Asia 2,091 North America 5,605 Europe 2,996 Global Marketshare by region Asia 17% North America 46% Europe 24% Single Aisle aircraft as percent of total Asia 43% North America 70% Europe 62%
Source: Ascend

2011 4,603 4,905 4,457 28% 30% 27% 68% 76% 77%

11 yr CAGR 7.40% -1.20% 3.70%

Market Potential—is Asia Where Ireland Was Back in 2000?
The following charts show the dichotomy between population and economic activity for the major global aviation regions. While population densities heavily favour Asia, relatively low GDP per capita pushes the number of the aircraft in the region to be in line with North America and Europe.

Population per commercial aircraft in service by region or country (100+ seats), end 2011 (millions)
Population/Aircraft (millions)

0.90 0.80 0.70 0.60 0.50 0.40 0.30 0.20 0.10 0.00 Asia Source: IMF, Ascend ASEAN Nth America Europe Ireland

GDP per commercial aircraft in service (100+ seats) by region or country, end 2011 (US$M)
GDP/Aircraft (US$M)
4.50 4.00 3.50 3.00 2.50 2.00 1.50

Fleet Details
Asia’s ﬂeet now closely matches North America and Europe in terms of the number of in-service aircraft, as well as the balance

1.00 0.50 0.00 Asia Source: IMF, Ascend ASEAN Nth America Europe Ireland

12 The ofﬁcial publication of the International Society of Transport Aircraft Trading

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Jetrader - July/August 2012

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