Chinese carriers expected to become global market leaders

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Ahead of a period of change for the world airline industry, a new report reveals Chinese carriers could replace United States airlines as the international air travel market leaders by 2033.

Released by aviation specialist OAG, the report titled The Fight for Global Markets – Is Three the Magic Number? explores the Rule of Three concept – the tendency for industries to become dominated by three major players.

The report also reveals US airlines are unable to rely entirely on the alliance model to continue international growth as more carriers are opting for cross-border collaboration.

OAG business development director JAPAC Mark Clarkson said it is expected that there will be a significant merge of airlines during this transformation period.

“The evolution is affecting everything – from historical business structures and government regulations to the growth and profitability of the key players in the market,” Mr Clarkson said.

“There are currently more airlines than can realistically exist in a truly global market where barriers are eased.

“Our analysis shows that in time, it’s reasonable to expect a major consolidation of airline carriers globally.”

The passenger seat capacity of China’s airlines, led by China Southern, China Eastern and Air China, has grown substantially over the last two decades.

According to OAG, the passenger seat capacity has increased from 100 million seats in 1996 to 600 million in 2014.

In a typical week in April this year, Chinese airlines operated 140 per cent more seats on flights to the US compared to 2010.

In contrast, US carriers increased capacity on the same routes by just 80 per cent.

Already Chinese carriers are seeing rapid international growth and, if it continues, it is predicted that China will overtake the US as the world’s largest aviation market by 2033.

Source = ETB Travel News: Brittney Levinson
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