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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.


    Korea-Japan aviation market: national disputes dent demand

    Among the biggest sufferers from the Korea-Japan dispute are Korea’s airlines.

    The Korea-Japan aviation market is one of the most important in the region, particularly for airlines based in South Korea. So the dramatic drop in demand on routes between the two countries in recent months is quite a significant development in Asia-Pacific market dynamics, with major repercussions for several airlines. Combined with the intense competition among Korean airlines, this has driven most into the red.

    The main cause for the relatively rapid falloff is increasing political and trade tensions between South Korea and Japan. Dating back to before the Second World War there are obviously some highly charged issues between these two nations, which have always formed an uneasy backdrop to relations between the countries.

    Some of these issues – such as the question of reparations – have come to a head this year, and the impact on travel demand has been severe. Leaders of the two nations are making the right noises about resolving the standoff, but it remains unclear when a real breakthrough will come.

    To read on, visit Korea-Japan aviation market: national disputes dent demand


    UK-China airlines: Virgin Atlantic to join AF-KLM/China Eastern JV

    In Oct-2019 Air France-KLM and China Eastern announced that from spring 2020 Virgin Atlantic would be entering their joint venture agreement for flights between China and Europe.

    Air France-KLM had already widened the scope of its partnership with China Eastern in Jan-2019. The addition of Virgin Atlantic to the JV reflects deeper ties following Air France-KLM’s acquisition of a 31% share in the UK airline.

    The Air France-KLM/China Eastern JV covers China to France and Netherlands, and the wider JV will add the China-UK routes of Virgin and China Eastern. Both operate London Heathrow to Shanghai Pudong, while China Eastern also operates to London Gatwick from Shanghai. China Eastern operates a further 125 routes from Shanghai Pudong, of which 66 are within China, offering significant domestic connections.

    UK-China has been a strong growth market, with a number of new entrants and significant expansion by the market leader Air China. However, number two operator British Airways has shrunk in this market over the past three years. The JV with China Eastern gives Virgin an edge over its main UK rival BA and boosts Air France-KLM’s position as the leading European airline group to China.

    To read on, visit UK-China airlines: Virgin Atlantic to join AF-KLM/China Eastern JV


    US airlines’ corporate travel demand steady in 2019; 2020 uncertain

    The three large global US airlines, Delta, United and American, are ending 2019 with an overall positive view of corporate demand, a trend that has been a mainstay throughout much of the year.

    The three feel good about their corporate prospects as they settle into the last quarter of the year, despite the overhang of global trade disputes and general economic uncertainty.

    There is lingering uncertainty whether the momentum will continue into 2020, and there are pockets of sluggishness emerging in corporate demand in some regions. For now, corporate demand may not be growing rapidly, however it remains trending in the right direction.

    To read on, visit US airlines’ corporate travel demand steady in 2019; 2020 uncertain


    Jet2.com, easyJet take majority of Thomas Cook Airlines slots

    It seems that Thomas Cook Airlines, the UK airline subsidiary of the bankrupt Thomas Cook Group, will not be missed for long. After the company went into liquidation on 23-Sep-2019, the Official Receiver was appointed to sell whatever of its assets it could in order to generate cash for creditors.

    Interest in Thomas Cook’s slots at a number of UK airports was soon expressed by potential bidders such as IAG, Virgin Atlantic and leading UK LCCs.

    On 8-Nov-2019 easyJet announced the acquisition of Thomas Cook slots at London Gatwick Airport and Bristol Airport, followed only hours later by Jet2.com’s announcement of its acquisition of Thomas Cook slots at Manchester, Birmingham and Stansted. The two deals account for approximately 70% of Thomas Cook Airlines’ summer seat capacity.

    For easyJet the acquired slots consolidate its leadership at Gatwick and Bristol.

    For Jet2.com the slot acquisitions are more transformational, taking it ahead of Ryanair at Manchester and Birmingham (Jet2.com’s two biggest airports) to be the number one airline at both, and taking it ahead of easyJet at Stansted to be number two (behind Ryanair).

    To read on, visit Jet2.com, easyJet take majority of Thomas Cook Airlines slots