Oct 28, 2008
Global Airlines Passenger Traffic to Reach 5,603 Billion RPKs by 2012, According to New Report by Global Industry Analysts, Inc.
World airlines suffered major losses for four subsequent years with no growth due to global economic slowdown, the war with Iraq, and the SARS infectivity. The turmoil in airlines has led to the development of novel solutions to meet varying needs of passengers and the market. The years 2006 and 2007 witnessed a reversal in the fortunes of the global airline industry, mainly due to the reversal in the fortunes of the industry in the US, the single largest aviation market in the world. The year 2007 was the best for the global airlines industry since 2000, as both passenger and cargo segments made significant gains.
San Jose, CA (PRWEB) October 27, 2008 -- An estimated 2.25 billion passengers worldwide traveled by air in 2007. The year 2007 was the best for the global airlines industry since 2000, as both passenger and cargo segments made significant gains. However, cargo growth was limited by increasing jet fuel costs. Containerised shipping, the major competition for air cargo transportation, has been gaining share from the airline industry. The price differential between jet fuel and residual fuel oil used in ships has made containerized shipping effectively competitive against air transport. As such, containerized shipping, both by road as well as by sea gained share from airlines in 2007. Additionally, the global economic slowdown in the second half of 2007 also affected the airline industry. Semiconductor industry, the major user of air transport, witnessed a slowdown in shipments towards the end of 2007, owing to inventory depletion measures undertaken by customers. This factor also affected growth of air cargo in the year 2007.
Worldwide passenger traffic market is estimated at 4,665 billion RPKs (Revenue Passenger Kilometers) for 2008, and is projected to cross 5,603 billion RPKs by 2012. The US represents the single largest market for passenger traffic and is estimated at 1,111 billion RPKs for 2008. Asia-Pacific represents the fastest growing region in the world, and is projected to register a compounded annual growth rate of 7.2% through the period 2001-2010.
Global freight traffic market is estimated at 160 billion FTKs (Freight Ton Kilometers) for 2008, and is projected to grow at a compounded annual rate of 5.1% over the period 2008-2012. Asia-Pacific represents the fastest growing airfreight market in the world, growing at a compounded annual rate of 8.4% through the period 2001-2010. The US, the largest market for freight traffic, is estimated at 46.1 billion FTKs for 2008.
The air cargo industry is highly related with the state of economy. The industry strengthens with growth in economy and weakens with decline in economy. Consumer confidence index and oil prices are usually the indicators of GDP in the short run. Semiconductor sales are often considered as the growth projector for air cargo industry. An increase of 24.4% in terms of semiconductors turnover is projected for the period 2007-2010. Cost cutting continues to be the top most priority for most of the airlines.
GDP is the vital factor influencing the growth of air cargo industry. The global economic state is expected to be encouraging in short term despite increasing oil prices, growing chaos in the Middle East and fluctuating financial markets. In addition to GDP, there are several other factors influencing the airline industry. Favorable elements comprise oil marketing pacts, currency strength, stability in the Middle East, growing Asian markets, and lower interest rates among others. On the other hand, factors that have an adverse bearing on the sector comprise intensifying aviation influenza, terrorism, high interest rates, trading alliances and protectionism, commodity price weakness, debt burdens, and political instability.
The Federal Aviation Administration (FAA) introduced new east coast air routes, in a move aimed at saving fuel costs, reducing emissions, and minimizing delays. Areas covered by the routes include the San Juan Center Approach Control airspace, Miami oceanic and New York oceanic. Operational from June 2008, the new routes enable controllers to offer more efficient altitudes for flights, thereby minimizing delays. The routes are expected to save fuel worth US$400 million to US$700 million and reduce carbon emission from planes by 3.9 million tones, over a period of 15 years.
Major Airlines covered include Aeroflot Russian Airlines, Air China Limited, Air Canada, Air France-KLM Group, Air New Zealand, American Airlines Inc., Asiana Airlines Inc, British Airways PLC, Cathay Pacific Airways Limited, China Airlines, Delta Airlines Inc., Emirates Airline, Japan Airlines System Corporation, Korean Air, National Aviation Company of India Limited, Qatar Airways Company Q.C.S.C., Singapore Airlines, and United Airlines Inc. among others.
The report titled "Airlines: A Global Strategic Business Report" published by Global Industry Analysts, Inc., provides a comprehensive review of market trends, drivers, issues, challenges, and research and development activities. Richly annotated with authoritative, and unbiased commentaries, and hard-to-find statistical facts, the report provides unequivocal views on future potential while throwing light on the prevailing climate in key regional markets. Also provided in the report is an enumeration of recent mergers, acquisitions, and other strategic industry activities.