from a recent LinkedIn post by IATA Regional Vice President, Asia Pacific, Philip Goh
The recovery of the aviation sector from the scourges of the COVID-19 pandemic has remained robust and encouraging. In July 2023, Asia Pacific’s international passenger demand grew 105% compared to the same month in 2022. Even so, it reached just 74% of 2019 levels. There is some way to go before the region achieves the volume of air passenger traffic in 2019.
While pent-up demand continues to drive traffic growth, seat capacity growth is not able to keep pace. Asia Pacific international capacity in ASK was 72% of 2019 levels in July 2023, far below the global capacity which has reached 88% of 2019. Supply side challenges faced by airlines across the world are well documented. These are impeding a faster restoration of flight frequencies and seat capacity in many markets, including Asia.
Contributory factors include supply chain issues and manpower resource constraints - whether the worldwide shortage of spare parts for airframes and engines, delays in the delivery of new aircraft, delays in aircraft maintenance and servicing, or shortage of skilled workers including pilots and cabin attendants. More recently, reported engine problems requiring mandated aircraft checks also further stifle plans to ramp up capacity.
There are no quick answers to solving supply chain issues. A product of the COVID-19 pandemic where some suppliers have either gone out of business or have significantly scaled back their operations, or a scarcity of raw materials owing to the war in Ukraine, it will take a few years for a return to some normalcy.
Everyone wants these supply side problems to ease as soon as possible, so that seat supply can match the strength of consumer demand. A demand and supply equilibrium also has a moderating effect on air ticket prices, which will benefit consumers. H
ence, it is hoped that aircraft and engine manufacturers and their suppliers will be able to find ways to restore spares availability and ramp up production and repair capabilities to help ease the pressure that airlines are facing as they navigate the uncertainties ahead.
