Asia Pacific airline leaders are endeavouring to reverse recent declines in profitability, where fierce competition has resulted in reduced yields for all carriers, regardless of business model, the Association of Asia Pacific Airlines (AAPA) said its annual Assembly of Presidents meeting in Bali.
While Asia Pacific airlines continued to experience strong passenger growth in the world’s largest aviation market over the past 12 months, a modest growth in air cargo this year, was not enough to offset the slowdown in traffic over the past 12 months, reflecting recent world trade conditions. This was particularly the case for Asia Pacific carriers operating dedicated freighter fleets, the AAPA noted.
“Whilst the outlook for continued passenger growth looks positive, the cargo situation is more uncertain. Overall, there is continued pressure on airline leaders from the region who are endeavouring to boost profitability to support future growth,” said Andrew Herdman, director general of the Association of Asia Pacific Airlines.
Delegates gathering at this year’s Assembly of Presidents meeting have good reason to remain positive about growth prospects for the long term, Herdman said, adding that they more immediately need to concentrate on a host of diverse challenges. Competition has proved to be fiercer than ever amongst carriers from within and outside the region operating with diverse business models, he added.
“The Asia Pacific region includes many of the busiest air routes in the world, with up to a dozen airlines competing on a single route. In order to improve profitability and ensure long term sustainability, Asia Pacific airlines are continuously reviewing their fleet and network development plans in line with evolving market trends.”
The AAPA said it is “once again concerned about safety oversight in the region,” where Asian carriers can find themselves restricted or banned from operating to EU and/or US destinations, due to a lack of effective regulatory oversight providing assurance that local carriers are operating in line with accepted international standards.
“Whilst further efforts are needed by governments to ensure effective implementation and strengthen the system of regulatory oversight by individual national authorities, AAPA remains opposed to the unilateral imposition of extra-territorial measures and operating restrictions. Airlines should not be held responsible for the shortcomings of their national regulatory authorities,” the AAPA said.
AAPA has taken a notable lead over the past 12 months in actively engaging with regulators and other industry stakeholders to share lessons learned and prioritise enhanced safety measures. Amongst recent initiatives, AAPA has organised two safety management workshops focusing specifically on turboprop aircraft, which often operate into remote airports with limited navigation aids.