Page 8 - AAA JANUARY - FEBRUARY 2017 Online Magazine
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        FEATURE AIRLINE FORECAST
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        Challenging Times



        Emergence of more powerful and better resourced airlines pose significant revenue
        challenges for competitors
        By Geoffrey Thomas




                                            THE FAMOUS CHINESE CURSE “MAY YOU   protection and China. Finally, it appears that
                                            live in interesting times” will be in full flight   the industry may not understand the needs
                                            in 2017 when airlines of the region face   and desires of its most important market
                                            almost a tsunami of challenges. Increased   - the business traveler. All in-all not a very
                                            international  competition  for Chinese  and   comforting cocktail.
                                            Middle-East carriers, the launch of the   The “international order” is not only
                                            long-haul low cost airlines back to Europe,   being disturbed by Chinese and Middle East
                                            the  rise  and rise of  the  AirAsia  group  and   airlines but airlines such as United Airlines
                                            the emergence of the more powerful and   are using 787-9s to open up routes such as
                                            better resourced Indonesian airlines all   San Francisco to Singapore, while Scoot
                                            pose significant revenue challenges for   will launch the Singapore – Athens route
                                            competitors. If that wasn’t difficult enough   with the same type of aircraft in 2017. And
                                            the oil price appears certain to continue its   there will be more destinations to follow.
                                            climb as the Organisation of the Petroleum   Waiting impatiently in the wings is AirAsia X
                                            Exporting Countries (OPEC) have finally   which has now completed International Air
                                            agreed to cap oil production heralding the   Transport Association (IATA) Operational
        Lucrative international long-haul   end of the relative airline profit bonanza of   Safety Audit (IOSA) and will soon announce a
        routes are now being targeted       the past two years. And to add more spice   date for the resumption of its Kuala Lumpur
        by long-haul low cost airlines.
        AirAsia  X is  soon  to resume  its   there is unpredictability of the new  Trump   (KL)-London service. It had planned to do
        KL-London service                   administration and its policies to trade   this with A330neos but a possible delay may
        8   ASIAN AIRLINES & AEROSPACE  JANUARY / FEBRUARY 2017                 WWW.GBP.COM.SG/AAA
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