Home' Asian Aviation : AAV March 2012 Contents Colin Baker
is year s Singapore Air Show yielded its fair share of eye-
Indonesia s Lion Air rmed up its 230-aircra commitment
for Boeing 737 MAXs; Kuwaiti lessor ALAFCO exercised
options to increase its Airbus A320 orders up to 85; Garuda
became the Asian launch customer for Bombardier s
CRJ1000; Lion Air s regional subsidiary Wings Air signed
up for a deal that will make it the largest ATR-72 operator in
the world; and Lion Air (again!) signed a deal with Hawker
Beechcra for up to four Hawker 900XPs that will take it
into the world of business jet charters.
A common denominator in many of these deals was
Indonesia. Five years ago, that country s aviation sector was
in a mess, with all its airlines, including ag carrier Garuda,
banned from European skies over safety concerns.
While there is undoubtedly still work to be done on safety
and infrastructure, progress has been made and Garuda has
embarked on an impressive turnaround programme since
becoming one of four Indonesian carriers to be removed
from the blacklist in 2009, resuming ights to Europe with a
ser vice to Amsterdam.
Ironically, Garuda is now cutting back its European ights
in response to the region s economic woes, reducing its
ser vices to Amsterdam from daily to four-times-a-week -- a
sign of the times, perhaps.
Malaysia-based AirAsia X is cutting its European services
altogether, citing the weak economy, high fuel prices and
onerous taxes. Another issue picked out by the long-haul low-
cost carrier s Chief Executive O cer Azran Osman-Rani was
scalability, or the di culty of making a route work when you
have less than a daily ser vice.
AirAsia X s decision has raised some question marks over
the viability of the long-haul low-cost model -- especially
with the Middle East s mega-hubs situated so conveniently
(or inconveniently) on some of the main routes. Cebu Paci c
Air s decision to launch A330 ser vices into the lion s mouth,
targeting the Gulf, and particularly the Saudi and UAE
migrant worker market, looks like a brave one.
Cebu has a few cards up its sleeve, such as a domestic
network that could link those migrant workers conveniently
to their o en-distant home islands. But a lot will depend on
how the Middle East carriers react -- and some have very deep
pockets. And with self-connections, sticking with one carrier
for the whole journey is less of an advantage.
Cabu s A330s will bring Hawaii into range from Manila,
and potentially onward connections to the lucrative US West
Coast. e A330 could also be used on some of the busier
short-haul routes such as Manila-Hong Kong.
For the more north-south oriented long-haul low-cost
routes in the Asia-Paci c region, things are perhaps a little
more straightforward -- although the jury is still out here as
well. ere is no doubt that the geography of Asia is at least
more conducive to ying than elsewhere, with travel times
between airports o en considerably longer than they would
be in Europe or North America.
One thing is for sure : there is no shortage of innovation
and dynamism in the Asian airline industry, and of course
no shortage of aircra orders. Airbus said at the Singapore
Airshow that Asia-Paci c airlines will take delivery of around
9,370 new aircra over the next 20 years, accounting for 34
percent of the 100-plus seat market and overtaking North
America and Europe as the world s largest air-transport
Given the huge orders announced by Asian carriers
over the past year, many would agree with Airbus s Chief
Operating O cer -- Customers, John Leahy, that it would
not be the end of the world if the industry had a quiet year
to digest some of this capacity.
e rapid growth of Asian airline eets will also fuel
growth in the wider Asian aerospace industry -- something
that was noticeable in Singapore. e air show was awash
with aerospace companies opening facilities, many at the
new Seletar Aerospace Park, which is quickly developing an
impressive critical mass.
is year looks as if it could throw up a few challenges for
the sector, but the long term picture remains one of growth
and a healthy-looking Asian aviation industry.
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AirAsia X's decision has raised some
question marks over the viability
of the long-haul low-cost model --
especially with the Middle East's
mega-hubs situated on some of the
market shows its worth
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