Future burns bright for Asian LCCs

ASIAN low-cost carriers (LCC) have managed to grow their footprint significantly in the past decade, but there is room for them to expand their operations even further.

According to aircraft manufacturer Airbus, LCC’s in Asia-Pacific have an intra-regional market share (in terms of number of seats offered) of only 22 per cent, compared to their North American and Europen counterparts, which have 29 and 39 per cent shares in their respective markets.

All the signs – including a forecasted six-fold increase in the region’s middle-class population between now and 2030, as well as fast-rising income levels – point to greater penetration by LCCs in the future.

For Airbus, AirAsia and IndiGo are now its first- and third-ranked customers in terms of planes purchased. Five of Airbus’ top ten customers worldwide are LCCs. Whereas only six of the world’s top 100 airlines were LCCs in 2000 (in terms of Revenue Passenger Kilometre), this sector now accounts for 23 of the top 100 airlines globally.

At the moment, Japan is the emerging LCC market with three carriers set to make their debut this year – Peach Aviation, which will launch flights linking Osaka-Kansai to Fukuoka and Sapporo in March, as well as AirAsia Japan and Jetstar Japan.

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