Asia's main airline association expects its member carriers to keep capacity growth flat in 2009 as market conditions are forecast to deteriorate further.
Association of Asia Pacific Airlines director general Andrew Herdman said at the group's annual meeting in Taipei in November that market conditions will probably "get worse before they get better". As a result AAPA's 17 members are revising expansion plans for 2009.
"The expectations are that capacity growth will be flat over this year," he says. "You'll see airlines accelerating retirements of older aircraft and if not parking them, then reducing utilisation."
Herdman does not expect AAPA's member airlines to cancel outstanding aircraft orders, however, as the carriers "want these new aircraft".
"These new aircraft are more efficient to operate and they have a long productive life ahead of them," he says.
Some AAPA member airlines have already announced that they will be reducing growth plans for next year. Cathay Pacific Airways, for example, is planning to dispose of its five Boeing 777-200s, while Singapore Airlines has said its ASK growth next year will be limited to around 1%.
"The industry is facing a pretty tough time over the next 12-18 months, maybe longer," says Herdman.
Market conditions will probably get worse before they get better
For more on the likely financial prospects for Asian carriers this year
Source: Airline Business
