Gulf carriers heat up competition in Asia Pacific’s intense airline industry


There is a giant shift taking place at the moment in the commercial aviation industry as the extraordinary growth of Gulf carriers continues to be felt around the world. There is no slowing down of the region’s ambition to conquer as many long haul routes as possible, and if there were ever any doubts, they would have been dashed by their gigantic wide-body aircraft order (+350) at the end of last year.

While Airbus and Boeing are sporting rather large smiles, airlines in Asia and other markets are finding themselves having to rethink their approaches. Emirates, Etihad Airlines and Qatar Airways find themselves in one of the most advantageous locations, connecting Europe to Asia, North and South America, Africa and India. Add the seemingly unending economical investment from the region, and global airlines are reshuffling their strategies to keep up.

Asian low cost carriers are responsible for the world’s largest aircraft orders this year, but the competition for full service and low-cost carriers in Asia is only going to get hotter. Emirates are aggressively expanding, carrying 39 million passengers in 2013, and aiming for 70 million annual passengers by 2020 according to the carrier’s CEO. The Gulf airlines are taking firm aim at the Asia Pacific region which is already affecting Asian carriers in some ways.

Garuda Indonesia remains the largest Asian carrier between the two regions; much of its capacity related to religious travel, with Cathay Pacific the second largest early in 2013, slipping to third place at the beginning of this year. Philippine Airlines has taken the number two ranking, largely driven by a demand for migrant workers. The Philippines has put pressure on long haul operations with new services between Manila to Dubai from Cebu Pacific, Philippine Airlines and PAL Express. With increasing saturation of the Philippines-Middle East market, and the addition of the Abu Dhabi to Hong Kong service from Air Seychelles (part owned by Etihad), Cathay Pacific is consolidating its network, recently announcing the end of its services to Abu Dhabi and Jeddah.

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