Southeast Asia is one of commercial aviation's strongest growth regions
Airline capacity has risen 80 percent since the 2009 recession, but passenger traffic has risen at an even higher rate, driving airplane load factors to nearly 80 percent. Multiple indicators—including high passenger volume and steady increases in domestic and international hotel bookings—reflect the upturn in the region's air travel. Thus, passenger traffic is expected to grow at 6.5 percent annually over the next 20 years.
This rate of growth will accentuate the need for regional investment to support and expand aviation infrastructure, including airport and airspace capacity. Even though plans include multiple new airports for the region—in countries such as Indonesia, the Philippines, and Vietnam—and the expansion of multiple existing airports, some key airports will still experience congestion. Government policies that support aviation, and continued investment in infrastructure, thus remain critical to growth of aviation in the region.
Adoption of the ASEAN Single Aviation Market will strongly support efficiencies and industry growth. Progress continues, but true “open skies” for the region will remain elusive for some time. The more liberalized the region's air services become, the more that passengers and airlines will benefit. Presently, no plans exist to allow foreign majority ownership of airlines in the region, thus the trend of airline-cobranded subsidiaries will continue to rise.
All told, Boeing forecasts that the region will need 3,750 new airplanes, valued at $550 billion, with more than three-quarters of new deliveries being single-aisle airplanes. The expansion of the low-cost carrier business model has been robust and will continue to stimulate regional growth. Southeast Asia is the world's most active region for medium-haul low-cost carriers, which is a business model with strong growth potential. This expected trend as well as demand from established long-haul carriers will drive the need for 800 widebody airplanes over the next two decades.