Global Market Forecast - The future of flying - HAW Hamburg
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Global Market Forecast
The future of flying
2006-2025
Contents
Page .6 Page .28 Page .36 Page .72
Demand for Traffic forecast Demand for Air cargo forecast
air travel passenger aircraft
22,663 new passenger and freighter aircraft
deliveries over the 2006-2025 period
Executive summary
New passenger 21,860 New deliveries 803
and freighter aircraft 22,663
deliveries will
average 1,133
per year Recycled Passenger fleet Freighter fleet
4,842
Converted
2,777
Retired
5,561
4,452 1,109
Air travel is a vital element of people’s lives around the world. It stimulates national economies, global trade Forecast highlights
and tourism. It helps to improve the quality of life in developed, developing and emerging countries. It unites
In recent years a number of significant developments have influenced passengers and airlines. These have
friends and families, lets people explore new horizons and cultures and gives access to career and educational
affected the shape and direction of the aviation industry, as well as the level of future demand around the
opportunities. It brings people together, face to face, to develop business opportunities and to tackle global world. Clearly Airbus takes these changing dynamics into consideration when developing and updating its
issues. Air travel responds to all of these human needs as no other manner of communication can – people Global Market Forecast (GMF).
want to and need to fly!
This year Airbus has expanded the scope of the GMF in two ways. First of all, it has included Russia and
the rest of the Commonwealth of Independent States (CIS). Secondly, it has added a number of dedicated
regional carriers to the more than 400 airlines already covered at a micro level, thereby broadening
significantly the report’s coverage.
Air traffic achieved a 14% annual growth rate in 2004, greater than at any time in the previous 25 years. This
strong performance was maintained in 2005, with a growth rate of 7%, well above the historical annual average.
Driven by a strong economy, new entrants, large emerging markets and increasing liberalisation, air travel
has grown nearly 30% since 2000, the strongest recovery in aviation history. This has been in spite of high
fuel prices and security concerns, and highlights the resilience of the industry. New entrants have added a
significant amount of (additional) seat capacity. The network airlines have succeeded in responding to the
The millions of people involved in aviation recognise that a balance must be maintained between the demand strong demand through dramatic aircraft productivity improvement, which has contributed significantly to
for air transport and the environment in which we live and are committed to achieving this. Moreover, aircraft their financial recovery.
manufacturers have an intrinsic requirement to be technological pioneers and to develop increasingly fuel- In the future, low cost carriers are expected to continue growing around the world, particularly in Asia.
efficient aircraft. This improves competitiveness, as fuel is the single highest operating cost for customers. In Meanwhile, the network airlines are expected to benefit from fast growing international markets, with a wave
short, reducing fuel consumption is in the best interests of the environment, of the customers and, therefore, of new international travel consumers from the emerging countries.
of the aircraft manufacturing business. Unquestionable strides have been made towards achieving this goal in
Over the 2006-2025 period covered by this forecast, world passenger traffic is expected to increase by
the last 50 years and it is clear that these efforts will continue to intensify in the future. 4.8% per annum. This traffic growth, combined with fleet renewal, will require the delivery of 21,860 new
passenger aircraft with more than 100 seats.
The number of passenger aircraft in service will more than double from 12,676 at the end of 2005 to 27,307 in 2025.
Airbus predicts that passenger airlines will replace 12,071 aircraft during this period. Of these, 4,842 aircraft
will be recycled back into passenger service, 2,777 will be converted to freighters and the remaining 4,452
7,200 aircraft will be permanently withdrawn from service.
to be replaced Freight traffic is expected to grow at 6.0% per annum between 2006 and 2025. When combined with fleet
renewal this will create demand for 3,580 freighter deliveries, of which 803, or 22%, will be factory-built freighters.
by more
efficient models Overall, this means that the world’s airlines are forecast to take delivery of 22,663 new passenger and
freighter aircraft over the next 20 years, equating to average annual deliveries of 1,133 aircraft.
Airlines will also require nearly 4,000 smaller jets, with between 30 and 100 seats, to serve regional demand,
especially in the US and Europe.
The world’s fleet, which includes both passenger (from 30-seater jets to very large aircraft) and freighter
aircraft, will grow from 17,153 at the end of 2005 to nearly 33,500 by 2025.
2 Global Market Forecast Executive summary Executive summary Global Market Forecast 3
New aircraft deliveries 2006-2025 Business volume 2006-2025
Number of new aircraft $ (billion)
18,000 1,200
15,330 1,014
16,000
1,000
14,000
12,000 800
680
10,000 503
600
8,000
396
6,000 400
3,868
4,000
1,800 1,665 200
2,000
0 0
Single-aisle Small Intermediate Large aircraft Single-aisle Small Intermediate Large aircraft
& small jet twin-aisle twin-aisle & & large & small jet twin-aisle twin-aisle & & large
freighters & regional long-range freighters freighters & regional long-range freighters
freighters freighters freighters freighters
% unit: 68% 17% 8% 7% % value: 39% 26% 15% 20%
Frequencies will double Total new deliveries by region
Passenger aircraft demand ≥100 seats, freighter demand excluded CIS
The number of frequencies offered on passenger routes will more than double. This is a more rapid rise than
in previous years and will, given current levels of congestion and delays, present a continued challenge to 2006-2015 2016-2025 % of world
deliveries
the world’s airports and air traffic management systems.
North America 200 348 3%
Europe
World jet aircraft size, including regional jets, will increase by 20% over the next 20 years, as a result of increased 2006-2015 2016-2025 % of world
congestion, diminishing returns of traffic stimulation from increased frequencies and the overall growth of the fleet. deliveries 2006-2015 2016-2025 % of world
deliveries
2,827 3,220 28%
This GMF assumes that all planned and required infrastructure improvements will be undertaken during 2,603 2,964 25%
the forecast period. However, given the substantial investments and time required to carry out such
Middle East
developments, there is the possibility that not all the changes necessary may be achieved. Should this Asia/Pacific
2006-2015 2016-2025 % of world
be the case, average aircraft size could go higher than anticipated levels and airlines could, therefore, be deliveries 2006-2015 2016-2025 % of world
forced to acquire larger aircraft in order to meet demand. deliveries
408 532 4%
The emergence of low cost carriers and increased liberalisation, particularly in Asia, will add more single- 3,432 3,310 31%
aisle aircraft on domestic and intra-regional flows than in previous forecasts. More than 70% of new Latin America Africa
deliveries will be single-aisle types. 2006-2015 2016-2025 % of world 2006-2015 2016-2025 % of world
deliveries deliveries
By 2025, the world’s airlines will be operating 1,263 very large passenger aircraft and 1,228 large freighter
696 702 6% 283 335 3%
aircraft to link dynamic hub cities. In particular, 56% of the world fleet of very large passenger aircraft will be
operated by the airlines of the Asia-Pacific region.
Passenger and freighter deliveries worth $2.6 trillion
The 22,663 new passenger aircraft and freighters that will be needed over the next 20 years are worth
approximately $2.6 trillion at current list prices. Top ten countries (2006-2025)
Most of this business will be generated from single-aisle deliveries, while 1,665 large passenger and freighter Passenger aircraft demand By $ value (billions)
aircraft will account for 20% of total aircraft delivery value. The greatest demand for passenger aircraft will
1 United States 6,628 United States 538.1
come from airlines in the United States, the People’s Republic of China and the United Kingdom. Europe will
2 People’s Republic of China 2,929 People’s Republic of China 349.3
receive 25% of the total, with the US and Asia-Pacific taking 28% and 31% respectively.
3 United Kingdom 1,282 United Kingdom 145.9
As many as 5,668 twin-aisle passenger and freight aircraft will be required to serve the existing, mainly 4 Germany 1,041 Japan 117.8
international, markets and new routes created by ongoing market evolution. 5 India 935 Germany 108.7
6 Russia 811 India 100.9
7 Japan 646 UAE 71.6
8 Mexico 620 Russia 69.6
9 France 543 France 68.4
10 Spain 519 Australia 63.2
4 Global Market Forecast Executive summary Executive summary Global Market Forecast 5
Demand for air travel
BRIC addressable market for air travel
to double in next ten years
Source: Global Insight, Airbus
Real annual household income in 1997 US$ at PPP$
Emerging markets:
Total population (millions) Real annual
3,200 household income
History Forecast
2,800 >$70,000
the main driver of growth 2,400
2,000
$17,500 - $70,000
1,600
1,200 Addressable market for
$7,500 - $17,500 air travel
1 in 5 aircraft 800
1995 500 million people
deliveries in 400 2005 800 million people
Emerging countries will drive the world
Large potential to increase propensity to travel
Source: ICAO, Global Insight, Airbus
Trips per capita – 2005
India: enormous
10 Bahrain
Qatar
Macau
1 Portugal
Kuwait
potential unleashed
Chile
Slovenia
Sth Africa
Brazil World average
Argentina
Russia
China
0.1
M
odern India is characterised by strong Strong basic need for transportation
India economic growth, the largest consumer in India
Source: IATA, UIC, Airbus
market in the world, an educated labour
*Revenue Passenger Kilometres (RPKs)
Bangladesh
force and dynamic entrepreneurship. Services and
0.01 information technology will remain the backbone Railway transport India Domestic air transport
China
of its industrial development, but India’s focus on
*Billion RPKs Billion RPKs
manufacturing, infrastructure and logistics could
600 150
push economic growth to new heights. Capital-
intensive projects coincide with a new bullish 500 120
confidence of the largest international investors in
0.001 400 90
India. In fact, India has become the most favoured
0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000
destination for foreign direct investment (FDI) after 300 60
2005 Real GDP per capita
(1997 US$) China, even ahead of the US. Furthermore, FDI
200 30
looks set to increase dramatically, accelerating
India’s manufacturing, infrastructure and logistic 100 0
2006-2010: highest traffic growth pulling traffic from buses and trains into aircraft.
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
in emerging and large population Because their emergence also coincides with the projects, including airports. Therefore, India is well
regions deregulation of their own domestic market, the BRIC positioned to become the world’s second most
*Asia excluding India and China
countries are moving much faster along the air travel powerful goods manufacturer in the near future,
which will in turn, provide a boost for business Boom in Indian air traffic following
propensity curve than any of the countries previously
Yearly traffic growth and freight traffic. deregulation
classed as emerging countries. For example, it will Source: IATA, Airbus
China +10.8%
have taken South Korea 20 years, from the start of its Over the last couple of years, air transport *Average Annual Growth Rate (AAGR)
India +9.8%
Expanding regions
emergence to achieving developed status, to reach deregulation in India has precipitated a number
Eastern Europe +9.7% Indian domestic traffic Indian international traffic
0.5 trips a year per capita. In comparison, it will take of new airlines and reduced fares, which has (Indian carriers)
Middle East +8.0%
5.4 billion
China less than 15 years to reach the same level. unleashed a large frustrated demand for air travel Billion RPKs Billion RPKs
CIS +7.4%
people 25 25
The emerging countries are not only demanding more in the country. India’s railway, which is the largest in
Asia +7.1% the world has previously benefited from the strong
air travel than that of developed regions but are also 20 20
Africa +7.0% demand for transportation in a large country with a
representing a much larger share of the world
Latin America +6.2% relatively limited road infrastructure and historically 15 15
population. As wealth and some of the more recent
airline models make air travel accessible to more and a high airfare environment. Interestingly, India’s rail 10 10
more people, there is considerable potential for air traffic has grown as fast as the rail traffic growth
Australasia +6.6% witnessed in China. However, unlike China, air 5 5
1 billion travel growth for these emerging economies.
Developed
Western Europe +5.6%
regions
traffic growth remained flat in comparison to
Japan +4.7%
people Brazil, Russia, India and China are the largest, but 0 0
China’s expanding air transport market through the
1997
1998
1999
2000
2001
2002
2003
2004
2005
1997
1998
1999
2000
2001
2002
2003
2004
2005
North America +4.1% not the only, emerging markets in terms of air travel. end of 2003.
Others include Indonesia, Malaysia, the Commonwealth
of Independent States (CIS), Poland, Hungary,
Turkey, Mexico, Argentina, Chile, South Africa,
Morocco and Egypt, while more are emerging
countries in the making.
10 Global Market Forecast Demand for air travel Demand for air travel Global Market Forecast 11
Previous constraint has led to large International traffic: higher share for
pent-up demand Indian carriers in the future
Source: IATA, Global Insight, Airbus
Billion RPKs
Billion RPKs 120
60 History Forecast
100
50
A giant pool of Domestic India traffic forecast
based on 1977-1987 historic data
80
first-generation 40 60
flyers in India 30
Average annual growth rate
40
and
20 te d dem 2006-15 2016-25 2006-25 20
Domestic India Frustra
historic traffic International traffic 0
10 +9.0% +6.3% +7.6%
Domestic India All Indian carriers
real historic traffic 1990 1995 2000 2005 2010 2015 2020 2025
0
1980 1985 1990 1995 2000 2005
Recognising that air transport is vital to India’s Domestic India traffic: catching-up on Over the last three years the international tourism India air transport demand summary
economic development, lawmakers have unfettered the large frustrated domestic demand market to India has increased by 60% and the
growth by enacting a number of deregulation business market has increased by 140%. India 2006-2015 2006-2025
Billion RPKs
measures since 2003. Indian enterpreneurs have 240 However, this has been a rapid growth and Total passenger traffic (annual growth) 8.9% 7.7%
responded by creating new airlines to feed the History Forecast
international airlines from other countries have also Domestic traffic 16.4% 12.3%
resulting dramatic demand. As a result, traffic has 200
been quick to benefit. As a result, airlines based
now taken off, growing at an impressive 20% per International traffic 6.8% 6.2%
160 in India have lost ground in terms of their market
year in the period from 2003 to 2005, in both Domestic India traffic Total freight traffic 6.8% 6.3%
“What should have been” share, which is now stable at 35%. However, with
tourism and business markets. This giant pool of 120
new bi-lateral air service agreements and the Total new deliveries (passenger aircraft) 557 935
first-generation flyers in India is already beginning to
80 acquisition of new aircraft, India’s airlines have Single-aisles 436 712
experience the benefits of air travel.
regained much of their competitive capability and Twin-aisles 106 179
40
If in 1987, experts could have forecast traffic can now start to address their international market
Very large 15 44
through 2005 in a fully deregulated market with the 0 share effectively. The Airbus traffic forecast
insight of the economic figures for the period, they conservatively assumes that the Indian airlines will
1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 Fleet in service in India 2005 2025
would have predicted some 30 billion more Revenue reach a 50% market share of their own international
Passenger Kilometers (RPKs) than the actual traffic markets by 2015. This assumption is expected to Passenger 190 959
performed – some 150% higher. So, today’s high help accelerate their traffic growth in the first Freighter 8 134
Growing international demand led by
traffic growth is really the result of large pent-up tourism and business activity decade to 9% per year, with it remaining above
demand created by regulatory and investment world average growth of 6.3% thereafter.
constraints prior to 2003. Tourism to India Business travellers to India
Number of tourists (thousands) Passengers (thousands) To accommodate the large domestic and international 935 new passenger aircraft needed
This is a demand now all too evident as the country’s 4,000 300 demand for air travel, the Indian fleet will grow in India
+56% +136%
population takes to the skies in ever increasing 3,500 from 190 aircraft in operation at end 2005 to 959 Passenger aircraft demand ≥100 seats; freighter excluded
250
numbers. The domestic traffic growth rate forecast 3,000 by 2025. As many as 44 very large aircraft will be Fleet size
200 959
for India is expected to continue to remain strong at 2,500 required on domestic, intra-regional and long-haul 1000
16.4% per year for the next ten years until this 2,000 150 international markets.
1,500 800
frustrated demand is fully served, after which air 100
1,000 631
traffic will grow at a rate more in line with Indian
500 50 600
economic performance.
0 0 Growth 935 aircraft
400
2002 2003 2004 2005 2002 2003 2004 2005
101 billion US$
190
200
2005 Stay 2015 Replaced 2025
0
12 Global Market Forecast Demand for air travel Demand for air travel Global Market Forecast 13
Concentration of demand in China led by
urbanisation and higher income in cities
Source: Population Division, UN, 2006, Airbus
By 2015 Population (millions) Urbanisation rate
50% of China’s 1,600
History Forecast
70%
population will be 1,400 60%
in urban areas
China: the fastest growing
1,200
50%
1,000
40%
outbound tourism market
800
30%
600
20%
400
on the planet 200
0
10%
0%
50
60
70
80
90
00
10
20
30
19
19
19
19
19
20
20
20
20
Rural Urban Urbanisation
population population rate
Concentration of Chinese wealth
Source: China Statistic Yearbook 2005
C
hina’s economy has soared at consistently Unlike India, where there is already a large middle Over the next 20 years, Chinese workers will
astonishing rates, even managing to outpace class, the Chinese middle class is still relatively continue to migrate to higher paying jobs in China’s
numerous economic forecasts. In fact, over small in comparison to the large waves of cities and become tomorrow’s middle class
the last four years, economists have regularly revised consumers who are expected to emerge with much consumers. It is anticipated that China’s urbanisation
their predictions upwards with some views for 2025 greater spending power than today. This wave is rate will reach 50% by 2015, some 700 million
Beijing
now 50% higher than in comparable forecasts created by the conjunction of six phenomena: people. By 2030, China’s urbanisation could be
published just three years ago. At current rates, (1) the burgeoning economy, (2) rapid urbanisation, approaching the level of Japan. The concentration
China could become the world’s largest economy in (3) resulting higher paying jobs in urban areas, (4) of wealth in the coastal provinces of the Beijing-
advance of today’s anticipated date of 2040. the gradual relaxation of the attitudes of the urban Tianjin corridor, the Yangtze and Pearl River deltas
Chinese society to savings, (5) the increasing value will develop further, but will also spread to other GDP per capita
In the last decade, 60% of China’s economic growth Renminbi (RMB)
of time and (6) the likely favourable exchange rate large cities.
has come from manufacturing. So much so that > 20,000 RMB (US $2,500)
for Chinese global consumers in the future. These
today China is considered to be the world’s A burgeoning economy, higher disposable income, > 10,000 RMB (US $1,250)
will lift Chinese middle classes to new heights, with > 7,000 RMB (US $850)
manufacturer. But, in the next decade China will a demographic shift toward large cities and the
air transport likely to be one of the beneficiaries. > 5,000 RMB (US $625)
not only be thought of as a producer, but also as growing importance of the younger generation < 5,000 RMB (US $625)
a significant consumer. consumer, have already yielded a sizeable increase
in consumer spending. However, today’s consumer
Large wave of urban China middle
spending in China is only a hint of what it promises
class emerging
China long-term economic forecast to become, as the high household saving rate has Source: National Bureau of Statistics of China; McKinsey Global Institute, Airbus
consistently revised upward somewhat limited its full potential. An increasing
Source: Global Insight
Share of China’s urban middle class households (%)
number of urban workers are steadily climbing the
80%
China real Gross Domestic Product GDP (billion US$) income ladder and will soon create a massive wave History Forecast
8,000 of middle class consumers that will push consumer 70%
7,000 spending to new heights. Research from the
McKinsey Global Institute suggests that in less than 60%
6,000
ten years the lower and upper middle class 50%
5,000
households will grow from 20% to 70% of the
4,000 urban population. 40%
3,000
Apr 2006 forecast 30%
2,000 Jan 2006 forecast
Oct 2005 forecast 20%
1,000 Feb 2004 forecast
May 2002 forecast
0 10%
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
2019
2021
2023
2025
0%
1985 1990 1995 2000 2005 2010 2015 2020 2025
Lower middle class
Upper middle class
Lower and upper middle class cumulative
14 Global Market Forecast Demand for air travel Demand for air travel Global Market Forecast 15
Chinese households spending more
on transport China outbound tourism: fastest air
Source: China Statistical Year Book, 2005 Airbus estimate travel market segment in the world
1993 Source: China National Tourism Administration, Airbus
% of total household expense
100% Government & Private & People (millions)
business travel leisure travel 80
60% 40% History Forecast
80%
Domestic China 70
China tourism outside Asia
60
60% air travel doubling 50
China tourism to Asia
2005
40%
every 5 years 40
Government & Private & 30
20% business travel leisure travel
19% 81% 20
10
0%
1985 1990 1995 2000 2004 2005E 0
19 3
19 4
19 5
19 6
19 7
19 8
20 9
20 0
20 1
20 2
20 3
20 4
20 5
20 6
20 7
20 8
20 9
20 0
20 1
20 2
20 3
20 4
15
Transportation and communication Housing
9
9
9
9
9
9
9
0
0
0
0
0
0
0
0
0
0
1
1
1
1
1
19
Recreation and education Food, clothing, medicine, others
Lower household saving rates in urban areas and Chinese outbound tourism entered a new phase 2,639 new passenger aircraft needed
Domestic China forecast higher income have already transformed Chinese in 2005. For the first time, the number of outbound in China
Passenger aircraft demand ≥100 seats; freighter excluded
households’ spending habits towards more travellers exceeded 30 million people, of which
RPKs (billions)
discretionary items. Spending on cars and housing more than 80% were tourists. However, only one in Fleet size
600
History Forecast has grown threefold and is continuing to grow at five Chinese travellers leave Asia after crossing the 2,666
500 even higher rates. Transport and communications border. The number of urban middle class 2,500
have become the fastest growing discretionary households reaching the income threshold that
400 2,000 1,892
spending items representing 10% of the Chinese opens up the possibility of international air travel is
300 household wallet today. The largest beneficiary has accelerating. As a result, Chinese outbound tourism
1,500
is on the verge of becoming the fastest growing Growth 2,639 aircraft
Airbus traffic forecast been air transport, with domestic air traffic doubling
200 tourism market on the planet.
Historical traffic 2006-2010: +14.7% p.a. every five years. 1,000
1985-2005: 16.45% p.a 2006-2015: +11.3% p.a. 758 288 billion US$
100 In 2005, around 3.5 million Chinese outbound Replaced
Indeed, domestic China traffic depends on the typical 500
tourists travelled beyond Asian borders, but this Stay
0 economic drivers such as the GDP, exports and
figure is expected to reach 30 million by 2015. After 0
imports, and airfares. However, it is also driven by
85
87
89
91
93
95
97
99
01
03
05
07
09
11
13
15
joining the Chinese Approved Destination list, South 2005 2015 2025
19
19
19
19
19
19
19
19
20
20
20
20
20
20
20
20
other specific emerging market characteristics such
RPK = f (Real GDP$ at PPP per cap. PRC, Real imports & exports $ PRC, Africa and Kenya have been able to increase the
Yield, Chinese Middle Class, Saving rate, Liberalisation) as middle class development and corresponding
number of Chinese tourists visiting them by 69%
disposable income (influenced, in the case of China, China air transport demand summary
and 661% respectively. However, surveys
by the household saving rates) as well as more demonstrate that Europe and Australia are the
qualitative variables, such as the pace of deregulation. destinations of choice for the future Chinese China 2006-2015 2006-2025
China single-aisle aircraft demand Based on those drivers, Airbus anticipates that tourists, both in terms of aspiration and intention.
sensitivity is low Total passenger traffic 9.0% 7.2%
domestic traffic will grow at 14.7% per year for the
*Average Annual Growth Rate (AAGR)
China to Europe represents 60% of the total long-
next five years and 11.3% for the following five years. Domestic traffic 11.3% 8.2%
haul international traffic of China compared with
China forecast 2006-2015 (AAGR*) At that rate and considering aircraft retirement over International traffic 6.8% 6.2%
30% for the China to North America traffic flow.
that period, the airlines of China will require the Total freight traffic 10.5% 9.1%
Europe is expected to remain the largest Chinese
delivery of 1,161 new single-aisle aircraft to fill the
international long-haul market. Total new deliveries (passenger aircraft) 1,503 2,639
domestic demand for air travel.
Over the next 20 years, China international and Single-aisles 1,161 1,909
Forecast scenarios based on different views and
domestic air travel demand will grow 6.2% and Twin-aisles 307 617
assumptions, derived from various economists and
8.2% per year respectively. To satisfy this strong travel
industry analysts, show little variation in terms of Very large 35 113
demand, the Chinese airlines will need to increase
domestic air traffic demand and single-aisle their passenger fleet from 758 aircraft in service today,
requirement in China. Indeed, the selection of the Fleet in service China 2005 2025
to as many as 2,666 aircraft by 2025. Also emerging,
lowest and highest assumptions gives only 100 demand for freight traffic is expected to grow at a Passenger 758 2,666
above and 60 below the most likely case. What is 8.9% per year pace. The dedicated freight fleet of the Freighter 33 409
LOW BASE HIGH certain however, is that demand for single-aisle Chinese airlines will need to grow from a small fleet of
Single-aisle demand 2006-2015
1,099 1,161 1,257 aircraft in China is set for strong growth. 33 aircraft today to 409 freighters by 2025.
16 Global Market Forecast Demand for air travel Demand for air travel Global Market Forecast 17Olympic Games
& World Cup to boost
tourism in China and
South Africa
T
he 2008 Olympic Games in Beijing and the For example, the Olympic Games held in Tokyo in Emerging countries to benefit the most The potential benefits are enormous, even for
2010 Football World Cup in South Africa 1964 and Seoul in 1988 were significant, partly from Olympic Games or World Cup developed countries: the Sydney Olympics
Source: Sparrow 1988, Airbus
represent a considerable opportunity for because they are the only games to have been accelerated the process of elevating the Australian
these emerging economies to boost tourism and hosted by Asian countries, but even more so Inbound tourism increase in % tourism profile through the leverage of significant
air transport to new levels. because these countries were still considered to be media exposure. Studies have credited the Olympics
Growth after event with bringing Australia not only AU$6 billion in
Major sporting occasions such as the Olympic emerging economies when the games took place.
The 1964 Olympics showed the rest of the world Growth after event inbound tourism spending during the year following
Games or the World Cup traditionally generate
how rapidly Japan had recovered, with its much- the games but more importantly, with creating the
infrastructure projects, jobs and revenue prior to
vaunted “Shinkansen” bullet train making its debut Growth equivalent of AU$6.1 billion worth of international
and during the events, but their legacy in terms of Growth without event exposure, thereby advancing international recognition
infrastructure and international tourism can last for between Tokyo and Osaka just in time for the without event
opening of the event, showcasing Japan’s emergent of its tourism attractiveness by 10 years.
decades. However, because emerging countries are
characterised by (1) a relatively untapped tourism technology and economy. Similarly, the Seoul pre- during post- pre- during post- Surveys show that the Olympics have increased
event event event event event event
market, (2) a limited global awareness of what the Olympics provided an opportunity for the world to tourist intention to go on holiday to Australia by an
country can offer and (3) an infrastructure still in discover South Korea’s cultural heritage and marked Developed host nation Developed host nation with tourism average of 40% in Asia and by 20% in North
development, they have even more to gain from a turning point in the development of Korea’s London 2012 below potential America and Europe.
major sporting events than developed countries. tourism industry. Athens 2004
Atlanta 1996 So, given the quality and extensive global coverage
Sydney 2000 that the 2008 Beijing Olympics and the 2010 South
Los Angeles 1984
Barcelona 1992 Africa World cup promise to receive, they can
certainly be expected to generate much longer-term
tourism benefits and to contribute greatly to the
Host in emerging countries traffic growth of the host nations.
South Africa World Cup 2010
Beijing 2008
Seoul 1988
Tokyo 1964
18 Global Market Forecast Demand for air travel Demand for air travel Global Market Forecast 19Larger urban population
Source: Population Division, UN, 2006
Expansion through stronger hubs 9,000
Population (millions)
History
Urbanisation rate
Forecast
70%
and network development 8,000
7,000
60%
50%
6,000
2005-2030 40%
5,000
+1.8%/year
4,000 30%
3,000
2005-2030 20% Rural Population
2,000
Hub cities -0.03%/year
T
10% Urban Population
he strong growth of intercontinental traffic 1,000
is distributed through (1) increased are also points 0 0% Urbanisation Rate
frequency and capacity on the existing
90
00
10
0
30
50
60
70
80
2
network, in particular between the large hub cities
20
20
20
20
19
19
19
19
19
and (2) through the development of the network,
where growth creates new opportunities, including
Many people live and work in hub cities and, More megacities and concentration
the opening of new routes.
therefore, want to travel to and from those cities for of population
Airbus believes that this pattern of network evolution business or leisure. The services offered by large Source: UN
will continue, with the addition of new non-stop hub airports in these cities have developed to meet 1985
and longer-range services and the strengthening Strong traffic growth to be distributed this demand.
through fragmentation and consolidation
of existing services to and from the world’s major
As nations develop economically and demographically,
hubs. It has, therefore, developed a family of long- Fragmentation “point-to-point” Consolidation “hub-to-hub”
an increasing proportion of their population migrates
haul aircraft, ranging from 250 to 555 seats, to help
to the large cities and adjoining suburbs. By 2030,
airlines address these evolving markets.
it is anticipated that 1.8 billion people worldwide
Many drivers shape the air travel network and every will have moved to urban areas where there are
one is both complex and, undoubtedly, connected. better prospects for jobs and higher wages. In
For example, network development is driven by fact, by 2007, experts believe that for the first time
the demand, itself influenced by price, but also by • Market development • Hubs are ‘points’ too more than half of the world’s population will be
the route profitability and infrastructure constraints. • If traffic volume/frequency sufficient • Hubs improve connectivity
urban dwellers. This will ultimately create a higher
Even if most people would prefer not to change propensity to travel by air.
aircraft during a trip, it will never be possible for
Today, just six cities worldwide have more than
everyone to fly non-stop from their home town to
15 million inhabitants. By 2025, there will be 2015
their final destination. Many other factors influence
12 such cities including seven in the dynamic
the route network development dynamic, not least
Asia-Pacific region.
demand, which when present at an adequate level,
can prompt and support the creation of new
profitable services between population centres.
Hub cities
are getting
bigger
Urban population
5-10 million 20-25 million
10-15 million
15-20 million >25 million
20 Global Market Forecast Fragmentation and consolidation Fragmentation and consolidation Global Market Forecast 21Half of the 100 fastest growing city-pairs This growth in urbanisation will have a direct impact
involve a hub at both ends on the growth and shape of the future network.
Growth in additional seats 1995 to 2005
Source: OAG September of each year. Non-stop routes only with range > 2000nm. Domestic routes excluded. For example, the 100 fastest growing city-pairs,
as measured by the number of seats added, link
North Atlantic Europe – Asia North Pacific some of the most important and dynamic cities
in the world. They include Shanghai, Vancouver,
Dubai, Hong Kong and San Francisco as well as Hub cities
old favourites like London and New York. Six of the are also the
seven airlines that have contributed the most growth
on these 100 routes have also ordered the A380.
most dynamic
All but one of the fastest growing routes includes a
cities in the
hub city, while half of them link two hubs. The route world
exhibiting the highest growth is London to Dubai,
which connects the world’s largest hub with the
newest global hub.
Trunk and thinner routes from 32 hub On the long-range markets, there are 32 hub cities
Leisure traffic continues to grow cities grow in parallel around the world today, which 80% of passengers
Intercontinental city pairs over 2,000 nm
Source: World Tourism Organisation, Global Insight want to fly to or from. These 32 hub cities are
Worldwide International arrivals by purpose of visit
Ticket price: ASKs (Billions) megacities and important global business centres. It
People (million) is no coincidence, therefore, that these cities are
1,200 the number one 90
Between the 32 hub cities 220 city pairs also major international air transportation hubs.
History Forecast criterion when 80
At least one hub city at either end Traffic between these 32 major hub cities has
1,000 selecting 70
Do not link a hub city at either end increased at the same pace as traffic connecting
60 them with secondary cities – approaching 50% of the
flights 840 city pairs total seat capacity offered in both cases. However,
800 50
24% the so-called “hub by-pass” routes, or routes not
Over the last 10 years, leisure traffic has grown 40
involving one of these major hub cities, are ten times
600
4.2% per annum and now represents 76% of total 30 smaller in terms of capacity than routes involving at
tourism traffic. This trend is expected to continue 20 least one of these 32 hub cities.
400
and will possibly accelerate, particularly as tourists 360 city pairs
76% 10 Analysis of actual origin and final destination
from emerging nations, such as India and China,
200 1990-2005 of passengers travelling on routes greater than
Leisure + VFR* join the world’s 810 million annual holidaymakers. 0
2,000 nautical miles (3,700 kilometres), reveals that
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
+4.2% per year Although economic growth remains the key driver
0
25% of the people who fly worldwide only want to
in mature markets, demand for air travel has travel between these 32 major hub cities and as
1990 1995 2000 2005 2010
progressively become more leisure orientated, many as 77% of people want to fly to or from one
Other Business VFR* Leisure
* Visit Friends and Relatives (VFR) thus increasing the price elasticity of air travel. of these cities.
Hub cities were, are and will
Several independent studies and a US Commerce remain dominant On the most mature of the “fragmented” markets,
Ticket price is the first criterion of choice
Department survey of international travellers, have between Europe and the US, eight of the top 10
Source: Survey of International air travel. US Department of Commerce
shown that pricing is the most important single Transatlantic
cities in terms of current air traffic were already
% of respondents Monthly seats (thousands) Monthly seats (thousands)
factor in choosing an airline – well ahead of the among the top 10 cities 30 years ago.
35% 1,000 1,000
33% What is your main reason for flying on this airline? availability of a non-stop service. This obviously 1975 2005
30% More than 80% of the new transatlantic long-range
becomes an even more critical factor in emerging
New York
800 800
London
New York
25% routes to have developed in the last decade are
Frankfurt
markets, where an international airfare can
Amsterdam
Washington
Los Angeles
20% 17% 600 600
Chicago
represent a large share of disposable income. linked to one of these 10 cities. This is particularly
14%
Copenhagen
Paris
15%
London
Amsterdam
Washington
Atlanta
Boston
11% 7% 400 Frankfurt 400 interesting as this market is held up as a case study
Chicago
10% As long as affordable ticket prices are more
Boston
5% 4% 4% in new route development.
Rome
3% 1% 1%
Paris
5% important to passengers than direct flights, the best 200 200
0% solution is to combine larger aircraft, with cheaper 0 0
operating costs per seat, and international hub
e
Fr edu ent
er
s
nc d
er
n
er
y
e
tio e
8 are still in the top 10 80% of new routes since 1995
ht
ic
ic
ic
ta im
tio
rie oo
fly
th
rri
ue e
e
n
ol
Pr
rv
g
h i
l
pu -t
n
ta
pe g
O
ca
fli
30 years later and still operated are linked to
p
se
nt
sc ve
airports, with a wider choice of destinations and
re On
pu
s
er
p
ex iou
to
on
ht
to
these cities
re
oy
eq
lty
ig
C
-s
ev
more convenient scheduling.
ty
pl
-fl
ya
on
Pr
fe
Em
In
Lo
Sa
N
22 Global Market Forecast Fragmentation and consolidation Fragmentation and consolidation Global Market Forecast 23New route
opportunities
from hub cities to
secondary cities
Lessons from a mature intercontinental Why are the hub cities key to route networks? This forecast uses passenger Origin and Destination Hubs: The cornerstone of
market: new routes involving a hub Put simply, it’s where the money is (for the airlines (O&D) demand for every potential city pair to project network evolution
Source: OAG September of each year
too). Indeed, the traffic between the hub cities on how the network might serve that city pair in the
Top passenger origin/destination cities in Europe
trans-Atlantic both sides of the Atlantic has doubled, despite the future. For example, Airbus expects there to be
Largest Smallest
addition of almost 100 regular direct routes during 73 new route openings between Europe and Asia
Between hub cities One hub city No hub city
the last 20 years. Remarkably, three quarters of by 2015, with enough demand to justify a minimum Larger markets: most Hub to
at either end at either end
+5 these new routes involve a hub city on one or both of three weekly frequencies on a sustainable are already operated secondary
Routes
3 3 +69 3 sides of the Atlantic. profit basis. Hub-hub
Largest
Thinner markets:
Top passenger origin/destination cities in Asia
Routes
Monthly seats (millions)
to be opened
On the developing trans-Pacific market, routes From a total of 300 routes between Europe and Asia
2 2 2 linking smaller cities have a high failure rate. Of the projected in 2025, 51 routes will connect hub to hub
52 routes opened during the past 20 years between and will account for more than half of total capacity. Secondary
34 to
Routes primary cities in Asia and the US, 90% have proved As many as 70 new trans-Pacific routes are expected secondary
1 1 1
+23 successful and are still in operation today. to be opened. The core hub-to-hub routes represent
57
secondary
11 Routes By comparison, a similar number of routes were 87% of total trans-Pacific capacity in 2015.
Hub to
Routes
Routes O&D traffic too small to be
0 0 0 opened between hub cities and secondary cities, of
opened with 3 frequencies per week
1986 2006 1986 2006 1986 2006 which only about half are still in operation. And of the
six routes opened between non-hub cities only two
are currently in operation.
Smallest
High failure rate on routes linking
Smallest
smaller cities – trans-Pacific Going forward, hubs will continue to grow, while
new routes will continue to be created as increasing
Number of city pairs
60 demand makes it economically viable for airlines to
open new city-pair combinations.
50
40
30
20
10
0
77% of air
Between hub cities One hub city No hub city travellers’ origin
at either end at either end
or final destination
is one of 32
Routes tried in the last 20 years Routes still operated in 2006
hub cities
24 Global Market Forecast Fragmentation and consolidation Fragmentation and consolidation Global Market Forecast 25Long-range route development
1995-2015
Existing and forecasted new routes above 6,000 nm
Source: OAG September of each year; Airbus, Rolls Royce
Cumulated number of city pairs > 6,000 nm
160
2015
140
120 2010
Traffic from 100 SYD-NYC
Hub-to-hub traffic to double in ten years
hub-to-hub 2005/2006
LAX-SIN
80
Source: IATA PAXis, Airbus forecast in monthly million pax (one way) to nearly 2000
JNB-ATL
60
Europe to Asia Europe to Asia double 1995
2005 2015 40
LAX-MNL
Connecting Point-to-point 20
37% 63%
0
Connecting Point-to-point Hub-hub 6,000 6,500 7,000 7,500 8,000 8,500 9,000 10,000 10,500
43% 57% x1.9
Equivalent Still Air Distance (ESAD) Max distance (nm)
Hub-hub
Today, 57% of the passengers from Europe to Asia To serve new markets, more range has often Europe – Asia 2015: Different markets
are flying point-to-point, meaning flying non-stop been required. For example in 1995, the longest for different aircraft
from their origin to their final destination. intercontinental route was Los Angeles to Manila,
but in 2005 the A340-500 enabled airlines to open Between hub cities
Hub-2nd In the future, Airbus anticipates that the Europe
2nd-2nd Singapore to New York, and by 2010 the longest
2nd-2nd Hub-2nd to Asia market will experience dynamic network
route will probably be New York to Sydney.
x2 x2.4 development, with increased frequency and new
routes developing, such as London to Chengdu Hub-to-hub routes getting larger, the route network
Total O&D = 1.3m passengers Total O&D = 2.5m passengers
or Madrid to Delhi. As these new routes open, developing through new services, more frequency
the proportion of people flying point to point in and more capacity on existing routes, long-
2015 will have only increased by six percentage range routes getting longer – this is the reality of
points to 63%. Indeed, the largest point to point international air travel today and will typify its future 2015 = 43 million seats
Stronger hub routes and network demand is mostly on existing routes and in particular evolution. This will mean that passengers will need
development more space and comfort.
between hub cities where the point-to-point traffic is
Europe – Asia expected to double. In response, the products offered by manufacturers
Between to serve these markets will need to be flexible and Hub cities – secondary cities
hub cities On routes linking hub cities to secondary cities,
efficient. Manufacturers must provide aircraft with the
point to point traffic will grow two and half times,
right size and range, offering comfort and space
Including with half of that growth resulting from the opening of
3 new routes throughout the cabin for passengers, together with
new non stop routes.
Hub cities - the optimum level of commonality and fleet flexibility
Secondary Therefore, in 2015, some 37% of passengers will for airlines. The Airbus extended family of long-range
cities
continue to connect, often on the existing hub-to- aircraft is uniquely positioned to match those
Including 61 new routes
hub routes, as these hub cities offer better service requirements through the A330/A340, the A350XWB
2015 = 31 million seats
Between and in fact are often the final destinations. and the A380.
secondary
cities Including 9 new routes
Between secondary cities
0 10 20 30 40 50
Yearly seats (millions)
Existing routes
Growth of existing routes to 2015 Traffic to
New routes 2006-2015 secondary
cities to more 2015 = 3 million seats
than double
26 Global Market Forecast Fragmentation and consolidation Fragmentation and consolidation Global Market Forecast 27Traffic forecast
Air travel resilient to external shocks
Source: ICAO, Airbus estimate for 2006
World annual traffic
Trillion revenue passenger kilometres (RPKs)
Asian WTC
Oil Crisis Oil Crisis Gulf Crisis Crisis Attack SARS
4.5
4.0
Traffic Forecast 3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
1971 1976 1981 1986 1991 1996 2001 2006
T
he starting point for any aircraft demand liberalisation, the growing importance of emerging base the micro demand forecast, which essentially Air travel demand has proven to be resilient to
forecast is a clear understanding of the issues markets and constraints, such as the influence of takes the form of a large number of airline by airline exogenous disruption such as recession, war,
driving air transport and the way in which airport congestion. fleet build ups. terrorism and disease. The impact of each crisis has
they relate to future air traffic and aircraft capacity. The market is segmented by airline business lasted only a short time, after which strong growth
In some market segments, classic econometric
Airbus’ traffic forecast process is based on four model, region and traffic flow, enabling the precise modelling is not sufficient to forecast traffic growth has been resumed. After two years of stagnation
major building blocks: preparatory market research, circumstances and drivers prevailing on every adequately. For example, in Asia, the development following 2001, air travel demand increased 14%
appropriate market segmentation, econometrics and, segment to be fully considered. of low cost carriers (LCCs) is driven by the pace and in 2004, 7% in 2005 and close to 6% in 2006.
importantly, network development. timing of deregulation within each country and the
Econometric data is then used to quantify future air Looking forward, the main drivers of traffic growth will
The Airbus Global Market Forecast analyses liberalisation between others. In Mexico, a portion be the increasing importance of the Middle Eastern
travel demand based on economic, operational and
a total of 152 distinct domestic, regional and of air traffic growth depends on the number of global hubs, the development of new routes, the
structural variables.
intercontinental passenger sub-markets, people switching from the popular bus network evolution of domestic traffic in China and India, the
Finally, the derived growth is distributed accordingly to air transport, which is a consequence of lower
segmented according to their degree of maturity Asian economic paradigm shift created by a wave of
across the route network, either through organic airfares and improved journey time. In the maturing
and specific characteristics over time. consumerism, and the continuing traffic stimulation
growth, such as the addition of traffic on existing LCC markets of North America and Western Europe,
by low cost or low fare airlines.
Airbus’ market research examines the fundamental routes like New York to London, or through the the LCCs’ growth will ultimately depend on the
drivers of transportation including future consumer additionof brand new routes. This process produces number and size of new routes still to be opened,
behaviour and expectations, the pace of a view of the future aviation network on which to on an economic and sustainable basis.
Airbus traffic forecast process Great potential for low cost carriers (LCCs) in Asia
North America Europe Asia
Market Market Econometrics Network
research segmentation development
Deregulation/liberalisation Regional/low cost/charter Economics Aircraft economics
Emerging markets Start-up/Network Tourism Airline operation economics
Modal competition Integrators Fuel price Origin-destination demand
Low cost penetration Traffic flows Yields Demographics
LCC Market share (seats): 29% LCC Market share (seats): 26% LCC Market share (seats): 9%
Consumer/travel surveys Domestic/International Trade/Value of goods Geopolitics
Population: 290 million Population: 375 million Population: 3.5 billion
Number of LCCs: 10 Number of LCCs: 50-60 Number of LCCs: 15-20
Deregulation: 1978 Deregulation: 1997 Deregulation: acceleration today
30 Global Market Forecast Traffic forecast Traffic forecast Global Market Forecast 3120 year
Domestic operations have world RPK Largest 20 traffic flows in 2025
been the main driver of rapid
expansion by Asian LCCs growth RPKs (billion)
20 years % of 2025
Source: OAG September
* % of total LCC seats 4.8% Domestic US
0 200 400
2005 traffic
600 800 1000 1200 1400 1600
2006-2025 growth
growth
2.7%
World RPKs
15.1%
2000 2010 Intra Western Europe 4.1% 8.9%
Western Europe – US 4.3% 7.3%
Domestic PRC 8.2% 7.3%
Asia – Western Europe 5.3% 3.2%
Western Europe – South America 6.4% 2.5%
Japan – US 4.5% 2.3%
Asia – US 6.2% 2.1%
In terms of the number of available seats, the Domestic India 12.3% 2.1%
Asia – PRC 6.7% 1.9%
37 292 market share of Asian LCCs grew from 5%
airports airports Western Europe – PRC 6.2% 1.8%
in 2004 to 9% in 2006, largely within their own
with LCC with LCC Western Europe – Middle East 6.2% 1.8%
operations operations deregulating domestic markets. While there is still Intra Asia 5.6% 1.6%
a potential for domestic new route development, Domestic Asia 5.2% 1.5%
Intra Asia*
the growth potential is thought to be much larger for Central Europe – Western Europe 6.8% 1.5%
23% the intra-Asian international markets. The pace of Caribbean – Western Europe
4.1% 1.4%
growth in these international markets will largely Africa Sub Sahara – Western Europe
4.6% 1.4%
Domestic* Domestic* Canada – Western Europe
100% 77%
depend on the pace of liberalisation between 4.6% 1.4%
Western Europe – Indian Subcontinent
countries in the region. For example, the Association 6.1% 1.4%
Western Europe – North Africa
of South East Asian Nations (ASEAN) are planning 4.8% 1.3%
for open skies in 2008.
Air travel demand between Asian cities in a fully
For other, more mature markets, such as the India and China fastest growing but
domestic United States (US) and the intra-European US and Western Europe remain the
liberalised market could generate up to 1,600 LCC
LCCs in Asia to continue their market, Airbus foresees average annual RPK growth largest markets
routes by 2015. The Airbus market forecast
strong growth of 2.7% and 4.1% respectively, itself not at all
conservatively assumes that by 2015 the progressive Traffic volume in 2025
insignificant, due to the already high base of traffic (billion RPKs)
2006-2015 RPK annual growth rate liberalisation within Asia will result in 920 of those
in these regions. 1600
12%
Asia
routes being opened. This will increase the number of Domestic US
Asian airports with LCC operations from 37 in 2000 Although Indian and Chinese domestic flows are 1400
10% to 292 in 2010. Asian LCCs are anticipated to grow at set to increase at a quicker pace, by 2025 the total
11% per year for the next ten years. volume of traffic and the actual volume of new RPKs 1200
Emerging Western Europe
8% (growth) in the US will still be larger. (domestic + intra)
Europe US Overall, Airbus predicts that for the next 20 years 1000
Revenue Passenger Kilometers (RPKs) will grow at However, by that time, the flows to and within Western Europe – US Domestic China
6% 800
Developing an average annual growth rate of 4.8%. North America, which traditionally generated the
largest volume of traffic, will have been overtaken 600
4% Among the largest submarkets, annual RPK growth
collectively by flows based in the fastest growing Western Europe – Asia PRC – US
on Indian and People’s Republic of China (PRC) 400
regions of Asia-Pacific and Europe. Intra-Middle East Domestic
2% flows is expected to average 12.3% and 8.2% India
200
Maturing respectively. This reflects increasingly optimistic In addition, the combined Middle East traffic flows Australia –
Middle East
0% projections for economic growth in these countries, are also expected to expand rapidly with 6.2%
0% 10% 20% 30% 40% as well as an increasing tendency for their annual growth to 2025. Africa and Latin America x1 x2 x3 x4 x5 x 10
populations to travel by aircraft. Growth will also be are also expected to increase by 5.4% and 5.3%
2006 market share (seats) driven by increased wealth and improved access to respectively over the next 20 years. Ratio to 2005 traffic
air transportation generally.
32 Global Market Forecast Traffic forecast Traffic forecast Global Market Forecast 33Traffic growth by airline domicile World traffic growth by regional flow – 2025 vs. 2005
CIS
2006-2015 2016-2025 20-year
Other flows
Billion RPKs
W. Europe – Middle East
growth
W. Europe – South Africa
6.1% 5.1% 5.6%
Domestic & Intra W. Europe
North America Europe World 2025
W. Europe – PRC
Domestic & Intra Asia
2,662 10,545
2006-2015 2016-2025 20-year 2006-2015 2016-2025 20-year 100%
growth growth
W. Europe – Asia
Domestic India
Asia – PRC
Japan – US
W. Europe – US
Asia – US
4.3% 3.6% 4.0% 5.0% 4.2% 4.6%
Domestic PRC
Middle East
143 133 129
154 143
Domestic US
Asia
2006-2015 2016-2025 20-year
209 196 187 50%
growth 2006-2015 2016-2025 20-year 218
433
8.1% 4.8% 6.4% growth 573
30%
7.4% 5.0% 6.2% 607
World 2005 664
Latin America Africa
4,094
2006-2015 2016-2025 20-year 2006-2015 2016-2025 20-year 0%
growth growth
6.3% 5.2% 5.8% 6.0% 4.6% 5.3%
World
2006-2015 2016-2025 20-year
growth
5.3% 4.4% 4.8%
Airlines based in the Middle East and Asia are expected to register growth higher than the global As a result of these developments, the way that actual traffic added are forecast to involve the US,
expected to develop more quickly than airlines average during this period, as air transportation traffic is distributed between regions is expected Western Europe or both. The US domestic market
based in other regions, growing by an average and its benefits continue to be more evenly to evolve. The biggest change will be traffic is still expected to add the most RPKs in the next
of 6.4% and 6.2% respectively. This is fuelled distributed world wide. becoming much more evenly shared across the 20 years, with the Chinese domestic flow next in
by the aspirations of airlines and in some cases world, with Asian airlines forecast to represent importance (by this measure).
Meanwhile, the airlines of North America and
the countries themselves, as well as access to 32% of traffic, an impressive six percentage points
Europe, some of the most significant in the world in
burgeoning markets driven by liberalisation and a increase when compared to the end of 2005.
terms of their aircraft fleets and traffic, will continue
growing propensity to travel. This having been said, flows which involve North
to grow strongly from an already powerful base,
The airlines of Latin America, the Commonwealth averaging 3.9% and 4.6% per annum respectively America and Europe are also expected to remain
of Independent States (CIS) and Africa are also over the next 20 years. significant. Seven of the top ten flows in terms of
Asia to lead in world traffic by 2025 India: international growth high, domestic even higher
RPKs growth: average per annum 2006-2015
Africa CIS
Africa
3% 3%
3% CIS Latin America
Latin America
3% 5%
4%
Middle East North Middle East North
5% America 6.8%
4% America Western Europe
31% 25%
US
PRC
6.3% 7.8%
7.9% Middle East
Asia 16.4%
26% Asia Indian traffic growth
32%
2006-2015 2016-2025 20-year
Europe growth Asia-Pacific
29% Europe
27% 7.3%
8.9% 6.5% 7.7%
World traffic at end 2005 World traffic at end 2025 World
4.1 trillion RPKs 10.5 trillion RPKs
2006-2015 2016-2025 20-year
growth
5.3% 4.4% 4.8%
34 Global Market Forecast Traffic forecast Traffic forecast Global Market Forecast 35You can also read
