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    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.


    Chiang Rai Airport: new AirAsia hub offers international service

    Thai AirAsia is launching four new routes from Chiang Rai in northern Thailand at the end of Jan-2019 and the beginning of Feb-2019. Chiang Rai will become Thai AirAsia’s sixth hub after Bangkok, Chiang Mai, Phuket, Krabi, U-Tapao/Pattaya and Hat Yai.

    Thai AirAsia is adding three international routes – to Kuala Lumpur, Macau and Singapore – as well as a new domestic service linking Chiang Rai with Phuket. Chiang Rai Airport has a small but fast growing international operation that until now has been limited to mainland China and Hong Kong.

    The international market accounted for less than 10% of the nearly 3 million passengers handled by Chiang Rai in 2018. Chiang Rai’s traffic has more than quadrupled since 2010, driven mainly by domestic expansion. AirAsia is already the market leader and will widen the gap compared to competitors as it launches the four new routes.

    To read on, visit Chiang Rai Airport: new AirAsia hub offers international service


    Europe to India aviation: long haul potential hotting up

    India was the fastest growing leading long haul market from Europe in 2018 (using seat data from OAG Schedules Analyser). Nevertheless, India is only Europe’s number four long haul market and is small compared with the USA, China and Canada (despite India’s population being close to China’s).

    Europe-India is led by Jet Airways and Air India, both of which are growing quickly. Jet launched Manchester-Mumbai in Nov-2018, and Air India’s entry into Denmark and Sweden in 2017 gives it a presence in eight European markets. However, European airlines control more than half of the seats in this market and have stronger connections behind their hubs.

    Bilateral constraints notwithstanding, India’s long haul potential is gaining tentative recognition with recent LCC entry, a good indicator of underserved, overpriced markets.

    WOW air’s Dec-2018 launch of Reykjavik-Delhi is the first low cost service between Europe and India, although, due to the carrier’s fleet restructuring, this service will be terminated in late Jan-2019. IndiGo is considering services to London (albeit one-stop initially) and is considering services to Istanbul.

    Other operators are also starting to challenge incumbents: Alitalia launched Rome-Delhi in Nov-2017 and Air Italy launched Milan to Delhi and Mumbai in Dec-2018. In addition, LOT Polish Airlines may start what would be Central Europe’s only service to India.

    This CAPA India report examines data on Europe-India capacity and growth, analysed by country and by airline.

    To read on, visit Europe to India aviation: long haul potential hotting up


    LCCs in Asia Pacific: two decades of steady market share gains 

    Low cost airlines were late to arrive in Asia. At the turn of the century there were only two very small LCCs operating in all of Asia Pacific, whereas LCCs had already captured significant market share in Europe and North America.

    LCCs in Asia have since expanded rapidly and successfully, despite fierce resistance from legacy full service airlines. LCCs now account for nearly 30% of capacity within Asia Pacific.

    There are still opportunities for further capacity share gains as several major markets in Asia remain well below the global average. China particularly is punching below its weight in terms of LCCs.

    To read on, visit LCCs in Asia Pacific: two decades of steady market share gains 


    US airlines & the passenger experience: biometrics still lumpy

    US airlines continue to embrace new technologies in 2019. United recently completed a proof of concept that leverages blockchain for ticket settlement, and Delta has opened the first biometric terminal in the country at its Atlanta hub.

    United concluded that the proof of concept allowed it to demonstrate the capabilities of blockchain, simplifying the payment and booking process for corporate travellers and their employers. The airline stated that several time consuming processes could be greatly improved.

    Delta’s is a big step with the opening of the first biometric terminal, but certain global standards need to be adopted in order for biometric usage to become more widespread.

    Although the promise of those technologies, and others, continues to build, for now they remain in their early days, and widespread adoption is far off in the future. However, there is growing consensus that emerging technologies can be used in a variety of capacities in the aviation industry to create a promising financial upside.

    To read on, visit US airlines & the passenger experience: biometrics still lumpy


    Virgin Atlantic, Flybe and Stobart Air: longhaul, meet shorthaul

    There are very few examples anywhere in the world, and none in Europe, of a single airline brand combining long haul widebody operations with short haul regional aircraft, without there also being a narrowbody business sitting between these two extremes.

    The bid for Flybe by Connect Airways, a consortium consisting of Virgin Atlantic Airways, Stobart Group and US investment form Cyrus, will do this.

    Recommended by Flybe’s board and subject to shareholder approval, the deal values Flybe and its website at only GBP2.8 million. It will bring Europe’s largest independent regional airline (Flybe) and the UK’s number two long haul airline (Virgin Atlantic) under the Virgin Atlantic brand and combine this business with a specialist in providing third party wet lease regional capacity (Stobart Air).

    Connect Airways is 40% owned by Cyrus, 30% by Stobart Group and 30% by Virgin Atlantic. In addition to acquiring Flybe, Connect Airways is also expected to buy Stobart Air from Stobart Group. The combination between Stobart Air and Flybe is easier to understand than that between Virgin Atlantic and Flybe.

    To read on, visit Virgin Atlantic, Flybe and Stobart Air: longhaul, meet shorthaul


    Canadian ULCCs: Indigo Partners to enter a crowded market

    The field of new ULCCs in Canada has officially widened now that Enerjet plans to launch in 2H2019. The company has always been the quietest among ultra low cost hopefuls in the country but now, with a new group of investors that includes Indigo Partners, Enerjet is exuding a high level of confidence about its prospects in the Canadian market.

    Backing from the ULCC specialist Indigo occurs at an interesting time. In the past Indigo has evaluated opportunities in the Canadian market, including an investment in Enerjet, but has opted not to enter Canada’s ULCC fray until now.

    Enerjet’s market entry will likely have little impact in 2019 but with the company’s planned debut, all three ULCCs that have been trying to get airborne for years will finally realise their ambitions. Those airlines are joining WestJet’s new ULCC Swoop, which plans to have a fleet of 10 Boeing 737s by YE2019. However, experiences elsewhere suggest Canada’s market is unlikely to support four ultra low cost airlines, in the longer run.

    But the benefits to consumers, airports and the economy will in the meantime justify the disruption.

    To read on, visit Canadian ULCCs: Indigo Partners to enter a crowded market