ANALYSIS: December 2017 – Middle East capacity insights for the month

In the continuation of a regular new series, The Blue Swan Daily offers a capacity snapshot in time and looks at the month ahead to highlight some of the key network trends across Europe, the Middle East, Africa and the South Pacific.


Summary:

  • Start of the month schedules show Dec-2017 departure seat capacity from the Middle East is expected to rise 4.2% versus same month last year.
  • Year to date Middle East departure capacity has averaged a 6.4% growth across the first 11 months.
  • While a decline on the Nov-2017 performance, Dec-2017’a growth rate returns to a similar level seen in Jun-2017 and Jul-2017 after a significant slowing of the rate of growth in Sep-2017 and Oct-2017.
  • Full year growth in capacity from the Middle East will be around half the rate recorded in 2016 and its lowest year-on-year rise since 2013.

In the case of the Middle East, a downward capacity growth trend that started in May-2017 was reversed in Nov-2017 as a significant amount of additional capacity was put into the market. Advanced schedules at the start of the month had predicted a growth of just +1.2% in Nov-2017 versus Nov-2016, but actual recorded levels rose +6.3%, according to OAG data, the highest rate of growth since May-2017 and above the annual average for the year.

The decline in growth during the second half of the year is mainly linked to the continued Qatar blockade which has ended all air connectivity between Qatar and Bahrain, Egypt, Saudi Arabia and the United Arab Emirates (UAE) and is now entering its seventh month. However, Qatar Airways has now redeployed part of this lost capacity during the current winter schedules, particularly into Europe.

Overall network capacity at the start of the month for Dec-2017 shows an expected +4.2% rise in capacity, less than the 2017 average but in line with the rates being seen in the post-Qatar blockade environment.

CHART – Network capacity growth from the Middle East is returning to healthy levels in Dec-2017 with a predicted +4.2% rise versus the same month last year based on start of the month schedulesSource: The Blue Swan Daily and OAG

With eleven months of the year complete, scheduled capacity within and from the Middle East is up +6.4%; a healthy rise, but this is the Middle East which has been growing at a considerably faster rate this decade. With the start of the month schedules for Dec-2017 suggesting a +4.2% rise in capacity versus last year this will bring annual growth levels to around +6.2%.

This is actually significantly down on the levels recorded in the past three years when year-on-year rises of +10.9% (2014), +10.2% (2015) and +13.2% (2016), were posted. In fact the number of departure seats from Middle East airports has actually risen +73.2% since 2010 and has more than doubled over the past ten years, growing +133.9%.

However, we are not comparing similar data sets and the Qatar blockade has had a significant impact on air services in the region.  The Blue Swan Daily reported last month that Qatar Airways’ own intra-Middle East inventory has fallen by more than a half during the June – November period from over 5.1 million seats in 2016 to just above 2.4 million this year.

CHART – This year the Middle East will see its slowest rate of capacity growth since 2013Source: The Blue Swan Daily and OAG