Budget airlines open up Asia's skies to the masses

A decade ago, even some of Asia's wealthier people could face a long bumpy ride on a bus to visit family or take a break on the beach - flying was simply too expensive.

Not any more. The proliferation of low cost airlines across the region, particularly in Southeast Asia, has opened up air travel to the masses.

Malaysia-based AirAsia, which launched in 2001, was one of the first airlines to rip open Asia's skies to the general public.

"Suddenly, people who had never been on planes - people who lived in villages and used to go on a 12-hour bus ride to see relatives - suddenly they were flying," says planemaker Airbus's Asia communications director Sean Lee.

"If the same thing happens in China, India and Indonesia, with their massive populations, imagine - the potential is huge."

So huge, in fact, that Airbus predicts that a third of all new planes will be sold into the region over the next 20 years - 8,560 aircraft worth a cool $1.2 trillion.

The company has a backlog of over a thousand aircraft waiting to be delivered to the region. And of those, AirAsia has 175 firm orders for A320s, with a further 50 on option.

The airline continues to expand with the opening of three hubs in Kuching in the east Malaysian state of Sarawak, Chiang Mai in northern Thailand and Medan in Indonesia.

It is also launching operations in the Philippines later this year.

"For 2011, our plan is to further expand our route network and key routes," AirAsia's chief executive Tony Fernandes told AFP.

"We also plan to be more aggressive in penetrating the Indian market and further expansion in China."

Cebu Pacific, the Philippines' already long-established low cost carrier, plans to invest a billion dollars in 21 new Airbus aircraft and hire 2,000 more staff over the next four years to boost its international operations.

Singapore's low cost carrier Tiger Airways, meanwhile, will take delivery of 26 aircraft by the end of March 2011, the company said.

India has eight budget airlines, which have gained nearly half of the market share in the country's rapidly growing aviation sector.

IndiGo, launched in 2006, is the country's youngest airline but has already become the third largest, flying 8.4 million passengers in 2010, a 16.5 percent share in domestic air traffic.

The airline announced a deal for 180 A320s, the largest number of Airbus planes ever bought in a single order, at the Paris air show this year.

IndiGo currently operates only domestic flights but has ambitious targets for 2011, planning to start flying internationally in August after recently getting government clearance.

Large scale models of the Airbus suite of aircraft were on display at the Asian Aerospace Expo in Hong Kong, alongside rival Boeing and the Chinese upstart COMAC, which has its own aircraft on the drawing board if not yet in the sky.

All will be competing for a slice of this massive market which will soon overtake both Europe and North America.

Airbus predicts a need for 5,200 new airliners in the single-aisle 100 to 210 seat category, such as the A320 family. Of these, around a third will go to low cost airlines.

The increase will be driven primarily by the growth of low cost carriers, as well as the opening of new secondary short haul routes, especially in China, India and Southeast Asia.

Airbus expects the number of passengers carried by Asia-Pacific airlines to rise by 5.8 percent per year, compared to global average increases of 4.8 per cent.

"Asia has traditionally been a wide bodied aircraft market," Airbus spokesman Sean Lee told AFP. "But the single aisle market is growing substantially, largely thanks to the low cost carrier sector.

"If you look back to 2001 there were basically no (Airbus) aircraft flying with low cost airlines in this region. It's expected to be 20 percent by the end of this decade - the growth has been really fast."

There are currently just over 300 Airbus aircraft in service with Asia-Pacific budget airlines, most of which are A320s - 18 percent of the current in-service Airbus fleet in the region.

There is also a backlog of around 370 aircraft on order for future delivery to budget carriers in the region.

Greater liberalisation "open skies" policies, especially amongst the ASEAN block countries, is also expected to boost air travel in the region, Airbus say.

But it might not all be bright skies and sunshine.

Standard and Poor's Equity Research aviation analyst Shukor Yusof says low cost carriers are likely to gain a bigger market share in the near to mid-term, as much as 20 per cent, as demand for leisure and discretionary travel grows and per capita income improves.

"That said, we anticipate turbulence in the energy markets to impact low cost carriers the most, given their business model and limited ability to offset the higher fuel costs," he told AFP

Have you tried new the Independent Digital Edition apps?
ebookHow to enjoy the perfect short break in 20 great cities
Independent Travel Videos
Independent Travel Videos
Simon Calder in Amsterdam
Independent Travel Videos
Simon Calder in Giverny
Independent Travel Videos
Simon Calder in St John's
Independent Travel Videos
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Travel

    Guru Careers: Events Coordinator / Junior Events Planner

    £24K + Excellent Benefits: Guru Careers: We are seeking an Events Coordinator ...

    Royal Yachting Association Cymru Wales: Chief Executive Officer

    Salary 42,000: Royal Yachting Association Cymru Wales: The CEO is responsible ...

    Guru Careers: Marketing Manager / Marketing Communications Manager

    £35-40k (DOE) + Benefits: Guru Careers: We are seeking a Marketing Communicati...

    Ashdown Group: Technical IT Manager - North London - Growing business

    £40000 - £50000 per annum: Ashdown Group: A growing business that has been ope...

    Day In a Page

    Is a quiet crusade to reform executive pay bearing fruit?

    Is a quiet crusade to reform executive pay bearing fruit?

    Dominic Rossi of Fidelity says his pressure on business to control rewards is working. But why aren’t other fund managers helping?
    The King David Hotel gives precious work to Palestinians - unless peace talks are on

    King David Hotel: Palestinians not included

    The King David is special to Jerusalem. Nick Kochan checked in and discovered it has some special arrangements, too
    More people moving from Australia to New Zealand than in the other direction for first time in 24 years

    End of the Aussie brain drain

    More people moving from Australia to New Zealand than in the other direction for first time in 24 years
    Meditation is touted as a cure for mental instability but can it actually be bad for you?

    Can meditation be bad for you?

    Researching a mass murder, Dr Miguel Farias discovered that, far from bringing inner peace, meditation can leave devotees in pieces
    Eurovision 2015: Australians will be cheering on their first-ever entrant this Saturday

    Australia's first-ever Eurovision entrant

    Australia, a nation of kitsch-worshippers, has always loved the Eurovision Song Contest. Maggie Alderson says it'll fit in fine
    Letterman's final Late Show: Laughter, but no tears, as David takes his bow after 33 years

    Laughter, but no tears, as Letterman takes his bow after 33 years

    Veteran talkshow host steps down to plaudits from four presidents
    Ivor Novello Awards 2015: Hozier wins with anti-Catholic song 'Take Me To Church' as John Whittingdale leads praise for Black Sabbath

    Hozier's 'blasphemous' song takes Novello award

    Singer joins Ed Sheeran and Clean Bandit in celebration of the best in British and Irish music
    Tequila gold rush: The spirit has gone from a cheap shot to a multi-billion pound product

    Join the tequila gold rush

    The spirit has gone from a cheap shot to a multi-billion pound product
    12 best statement wallpapers

    12 best statement wallpapers

    Make an impact and transform a room with a conversation-starting pattern
    Paul Scholes column: Does David De Gea really want to leave Manchester United to fight it out for the No 1 spot at Real Madrid?

    Paul Scholes column

    Does David De Gea really want to leave Manchester United to fight it out for the No 1 spot at Real Madrid?
    Season's finale brings the end of an era for top coaches and players across the continent

    The end of an era across the continent

    It's time to say farewell to Klopp, Clement, Casillas and Xavi this weekend as they move on to pastures new, reports Pete Jenson
    Bin Laden documents released: Papers reveal his obsession with attacking the US and how his failure to keep up with modern jihad led to Isis

    'Focus on killing American people'

    Released Bin Laden documents reveal obsession with attacking United States
    Life hacks: The innovations of volunteers and medical workers are helping Medécins Sans Frontières save people around the world

    Medécins Sans Frontières's life hacks

    The innovations of volunteers and medical workers around the world are helping the charity save people
    Ireland's same-sex marriage vote: As date looms, the Irish ask - how would God vote?

    Same-sex marriage

    As date looms, the Irish ask - how would God vote?
    The underworld is going freelance: Why The Godfather's Mafia model is no longer viable

    The Mafia is going freelance

    Why the underworld model depicted in The Godfather is no longer viable