Catch up on CAPA’s exclusive Market Analysis pieces

    Each week, CAPA – Centre for Aviation, produces informative, thought provoking and detailed market analysis of the aviation industry. With supporting data included in every analysis, CAPA provides unrivalled and unparalleled intelligence.


    Seattle Tacoma facing constraints: more than 60 million ppa projected

    Seattle Tacoma International airport has posted significant passenger growth during the past few years, driven mostly by Delta’s decision to develop Seattle as its long haul springboard from the US West Coast. As Delta has grown, the airport’s dominant airline – Alaska Air Group – has asserted its position with its own expansion from its largest hub.

    The build-up by both Alaska and Delta has obviously resulted in more options for passengers travelling through Seattle Tacoma International, but that growth has also resulted in Seattle facing constraints, particularly in handling international passengers.

    The airport has a raft of a construction projects under way, including a new high profile international arrivals facility scheduled to open in 2020. Structural expansion is no doubt crucial for Seattle as it continues to march towards reaching its passenger capacity thresholds but the airport’s physical footprint is limited, which means local governments will need to give serious consideration for a second airport in the region at some point in the future.

    To read on, visit Seattle Tacoma facing constraints: more than 60 million ppa projected


    North Asia aviation outlook: rapid growth set to continue in 2019 

    North Asia has enjoyed spectacular growth over the past several years. While China has clearly led the way, South Korea and Taiwan also have been growing rapidly, and even Japan has had a resurgence in the past few years.

    LCCs have finally started to penetrate the North Asian market, helping to drive the rapid growth as lower fares have stimulated demand. LCC capacity in North Asia has increased tenfold over the past 10 years, albeit on a small base, and has nearly doubled in just three years.

    North Asia’s LCC penetration rate is still less than 20%, indicating that there is still plenty of opportunity for further LCC growth. LCCs are planning more rapid expansion in 2019 but the region’s FSCs are also growing, particularly in China. The outlook is relatively bright for the North Asian airline sector, even with political instability and the US-China trade war.

    To read on, visit North Asia aviation outlook: rapid growth set to continue in 2019 


    Aircraft economic lives: more old aircraft in leased commercial fleets

    CAPA recently addressed the topic “Recent portfolio trading activity has featured an increasing percentage of older equipment – how does this influence economic lives?”

    The CAPA Fleet Database offers evidence that portfolio trading activity (i.e. of leased aircraft) over the past five years has featured an increasing percentage of older equipment. Over the past three years aircraft economic lives have also increased, at least in the sense that the leased commercial aircraft fleet now has a higher average age and contains a higher proportion of older aircraft.

    The seemingly narrow subject of the economic lives of aircraft actually touches on all the key drivers of value in the airline industry – and suggests that this situation could possibly be on the point of reversing.

    To read on, visit Aircraft economic lives: more old aircraft in leased commercial fleets


    Aviation’s challenging environmental outlook: faster action needed

    Because of projected traffic growth, climate change is possibly aviation’s biggest environmental challenge, in spite of the industry’s relatively small current contribution to carbon emissions. The Dec-2018 Climate Change Conference in Katowice heard that the world is in line for global warming of 3C by the end of the century – much worse than the 1.5C goal set by the 2015 Paris Agreement.

    Global aviation set targets 10 years ago to mitigate its climate change impact: 1.5% pa fuel efficiency improvements to 2020, carbon neutral growth from 2020 and a halving of emissions by 2050 versus 2005. Its strategy to achieve these goals consists of four pillars: operations, infrastructure, technology and a global market-based economic measure, CORSIA, which is a stop-gap pending technological solutions such as biofuels and new propulsion technology. Jan-2019 marks the start of the reporting phase of CORSIA.

    Few other industries have such a comprehensive approach. Nevertheless, aviation is not included in the Paris Agreement and is vulnerable to accusations that it is not doing enough. In Katowice in Dec-2018 the UN Secretary-General António Guterres articulated goals of a 45% reduction in carbon emissions by 2030 and net zero by 2050 (versus 2010). Aviation led the world in setting climate change targets but now looks like a laggard. This needs to change in 2019.

    To read on, visit Aviation’s challenging environmental outlook: faster action needed


    Saudi Arabia’s flyadeal’s major aircraft order coming soon

    Saudia’s low cost subsidiary flyadeal is planning another major push in Saudi Arabia’s domestic market over the next month as it puts into service three additional A320ceos. The LCC’s seat capacity will increase by more than 30%, pushing its share of the Middle East’s largest domestic market up from 11% to 14%.

    Flyadeal expects to carry 3.5 to 4 million passengers in 2019 – an impressive achievement, given that the airline is less than two years old. Flyadeal has not yet captured significant global attention, but that is about to change when it announces a major narrowbody order.

    Flyadeal is hardly your average start-up: it issued Airbus and Boeing an RFP for up to 50 aircraft (30 firm and 20 options) only a couple of months after it began operations and could issue an RFP for widebody aircraft next year.

    To read on, visit Saudi Arabia’s flyadeal’s major aircraft order coming soon