Business Aviation

Stronger Global air traffic results in 2013 H1 largely driven by the development in the Middle East

aviation_newsThroughout the first five months of 2013 the global air passenger traffic was further showing signs of a healthy recovery, climbing up by 4.5% in comparison to the same period in 2012. While in terms of market growth the Asian-Pacific region along with Europe and North America still remain on the outskirts, the growth in the international air passenger demand had been mostly supported by the emerging markets with the Middle East at the lead.

The ongoing market liberalization, as well as the development of code-sharing agreements with airlines outside the region is continuing to boost air passenger flows across the Middle East. While the countries in the region are de-monopolizing and opening their aviation market, both local and foreign airlines, ground handlers as well as other industry players are spurring the competition thus creating a positive impact on the prices and quality of service. Furthermore, the successful implementation of such collaboration projects like the ones developed between South African Airways and Etihad Airways or Emirates and Qantas are also bringing more transit passengers to the region thus contributing to an average of 12.6% of the traffic growth during the first five months in 2013.


While North America and Asia-Pacific remain relatively slow developing regions (below 4%), the European market had shown a positive leap in air traffic. IATA reported a 5.6% market growth in May 2013 in comparison to May 2012. Stronger development reflects the economic optimism observed in the European economy. According to the OECD’s Economic Outlook, already in Q3 2013 the Eurozone is likely to experience a long lasting increase in GDP, reaching a growth rate of 0.7% and 1.8% by the end of 2013 and 2014 respectively. Though several larger players are still restructuring and redefining their businesses, the market conditions are strongly favourable for low-cost carriers such as Ryanair, EasyJet or Wizz Air. Naturally, such carries are continuing to further penetrate local European markets. Their confidence in regional market is clearly reflected in the recent order for 175 new Boeing 737-800s placed by the Irish low-coster.

aviation_newsLatin American and African markets had been also growing over the projected period. An average of 7.8% and 7.96% growth was observed in Latin America and Africa respectively. Being in the TOP3 of the fastest growing markets, the development of regional air transportation industries is based on strong performance of local economies. The development of the international air transportation in Africa is heavily influenced by the intensifying trade connections with Asia-Pacific, the USA and the Middle East. China has already outrun the USA in becoming the largest trade partner of the African countries, with almost $200 billion worth of trade connections in 2012.  According to IATA, in 2013 airlines around the world will gain $12.7 billion in profit, an almost 20% increase compared to the previous numbers projected in 2012.The figures indicate optimistic expectations of the industry with regard to stronger development of the air transportation market in the upcoming several years.   Source and Photo: AviaAM Leasing

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