As Asian market in aviation sector is increasing, top aircraft makers Airbus and Boeing are set to increase their market in the region. Growth of mainland Chinese carriers and the entry of many budget operators have meant billions of dollars in orders for the aircraft makers. At the Singapore Airshow, top officials from both aircraft manufacture outlined their plans to capture that boom.
According to IATA forecast, Asia Pacific is likely to have 3.5 billion passengers by 2036, adding more than double the forecast for North America and Europe combined. To meet this demand, Boeing estimates carriers will need 16,050 new aircraft costing $2.5 trillion by 2036.
The carriers in mainland China and those in India and Southeast Asia plans to increase their operation and the aircraft carriers Airbus and Boeing continue wooing Asian customers though aircraft deals were flurry in last decade.
China is likely to surpass the U.S. as the world’s biggest air travel market by as early as 2022 and will be adding 921 million passengers by 2036, followed by India with 337 million and Indonesia with 235 million, according to IATA. Only 10 percent of the population in Asia has taken to the skies. That means the number of people using planes for travel will only grow.
Airlines from Asia-Pacific are also among the top buyers of aircraft. They make up for the biggest portion of the order for Airbus and Boeing. This region is estimated to account for 39 percent of the total projected global demand for 41,030 aircraft by 2036.
Although the market in Asia Pacific are increasing, full-service carriers in Asia are losing passengers to budget operators and carriers based in the Middle East and China. The average operating profit margin for Asia Pacific airlines is likely to drop for a second year to 8.1 percent followed by 12.7 percent of North America stated by IATA.
Shukor Yusof, founder of aviation consulting firm Endau Analytics said major airports in Asia are investing to expand capacity; they are still slow to match the pace of growth in aviation.