IATA, which is finalising a Vision 2050 that will turnaround a sick industry, believes Asia will be the game-changer of world aviation as the region accounts for the largest pie of the global passenger traffic (30 per cent) by 2014.
“With an increase in size comes influence and responsibility,” said IATA director-general and CEO Giovannin Bisignani at a briefing this afternoon to update the media about its Vision 2050 meeting last Saturday involving 35 strategic thinkers discussing the industry’s sustainable development.
Already this year, Asian airlines are expected to account for 50.5 per cent of global aviation’s profit forecasted at US$9.1 billion. Market capitalisation of the five largest airlines in the world also shows a shift eastward, with Air China at US$20 billion, merged Chile’s LAN and Brazil’s TAM at US$15 billion, Singapore Airlines at US$14 billion, Cathay Pacific at US$12 billion and Southern China at US$11 billion.
Bisignani believes China – and to a lesser extent, India – will “take the lead” in changing the rules of the game that were invented 65 years ago primarily with the leadership of the US and Europe. Restrictive policies and barriers to growth saw airlines making an average margin of 0.1 per cent, which he said was “the margin for a charity association, not a business”.
ASEAN was already taking regional leadership by removing barriers to market access and aiming for a Single Aviation Market by 2015, he said. “And even with the political barriers that exist, the region has also found solutions to allow multinational brands like Jetstar or Air Asia to grow. So I have great hope that Asia-Pacific will gradually take on a more vocal, proactive and positive role in driving aviation’s future,” Bisignani said.
IATA will consolidate opinions from the meeting and present the results at its next AGM in June. Four areas were discussed: an industry structure for financial sustainability, understanding the passenger of the future, aircraft and technology for the future and infrastructure for the future.