Peter von Moltke

International aircraft lessors viewed with interest some telling facts released this week. 

The world’s airlines have scheduled some 3% more capacity on 2% more flights in December 2011, marking the seventh consecutive month of growth compared to the same period last year.

The OAG FACTS (Frequency and Capacity Trend Statistics) report for December reveals that 51,166 more scheduled flights offering 10.5m more seats will operate this month, totaling 322m seats on 2.5m flights. Average seats per flight in December total 126, compared to 124 a year ago.

However, declining performance in the US and Europe continues to offset the explosive growth in Asia Pacific and Latin America. Comparatively, December 2010’s global capacity and frequency grew 5.7% and 4.8% respectively versus the December 2009 period.

The US is the largest global market affected by declining airline capacity, with December 2011 domestic capacity and frequency down 3% and 4% respectively versus the year-ago period. The US domestic share of global capacity is now 21%, down from 32% in 2002, driven by the rise of non-US markets and the rapid growth of those markets.

In contrast, intra-Asia’s market share of global capacity has consistently risen from 23.5% in December 2002 to over 31% in December 2011.

In Europe, monthly capacity has remained flat since 2008, with December 2011 showing a 4% decline versus December 2010. Intra-EU share of global capacity in December 2011 is 14%, which is slightly lower than where it started in December 2002, driven by ground transport competition and almost no intra-EU network growth by legacy carriers.

Peter von Moltke, chief executive officer, UBM Aviation stressed:  “A continued weak economy, airline consolidation, high fuel prices and fragile yields are making it difficult for airlines to invest new capacity in mature, low-growth markets, which are primarily secondary US hubs and intra-Europe markets where ground transportation is a viable alternative to air travel.”

“This creates an opportunity for low cost carriers to gain share, as the world’s major carriers leave smaller markets and prepare to serve hundreds of millions of new passengers in Asia, India, Russia, the Middle East and Brazil over the next five to 10 years.”

Major Hub Airports

The world’s busiest airport (by passenger traffic), Atlanta, saw a 3% decline in capacity and 5% decline in frequency in December 2011 versus the year-ago period. Beijing, second in passenger traffic volume, grew 4% and 3% in capacity and schedule frequency respectively. Only 400,000 monthly seats now separate these global giants, suggesting that Beijing will become the world’s largest airport in 2012.

Major airline routes that showed unusual declines in capacity for December 2011 compared to the year-ago period include:

● -7% Frankfurt – to/from US & Canada;

 ● -5% Tokyo (NRT) – to/from US & Canada;

 ● -4% Paris – to/from Africa;

 ● -3% Paris – to/from US & Canada;

 ● -3% London – to/from Africa;

 ● -2% London – to/from Middle East; and

 ● -2% Frankfurt – to/from Asia Pacific.