SINGAPORE: Asia’s budget airlines are set to expand their share of the regional aviation market to 20% within three years from less than 1% in 2001, an industry consultancy said today.
The strongest growth will be seen in India, Indonesia, Malaysia, Thailand and Australia, the Sydney-based Centre for Asia Pacific Aviation said in a report received here.
The predictions were based on announced aircraft orders by Asian budget carriers which will increase their seat capacity sharply over the next few years, said Peter Harbison, executive chairman of the consultancy.
Last year also provided evidence of the budget carriers’ phenomenal growth with overall capacity up 55% over 2005 while full-service carriers only saw a 0.9% increase, he said.
“Based on recent LCC growth rates and aircraft orders, their share could reach 20% by the end of this decade, with much higher levels of penetration in such markets as India, Thailand, Australia, Malaysia and Indonesia,” said Harbison, referring to low-cost carriers.
“The LCC share in Asia was less than 1% in 2001. Such an outcome would eclipse the pace of LCC development in every other geographic region, albeit a delayed development in this region,” he said.
According to Harbison, the aviation sector in Asia is essentially a “two-speed market” with full-service carriers growing more slowly than the budget airlines as well as counterparts in India and China.