ATM 2020: Low-cost carriers are key growth drivers in Middle East aviation

ATM 2020

CAPA Centre for Aviation’s data, released ahead of the Arabian Travel Market (ATM) 2020, has revealed that low-cost carriers (LCC) are driving growth in the Middle East aviation market, having recorded a 9.3 per cent increase in seat capacity in 2019.

Indeed, LCC’s share of total seat capacity across the Middle East increased from 14.9 per cent in 2018 to 16.5 per cent in 2019, with a larger share of the region’s airline passengers now opting to fly with no-thrills airlines in more modest and affordable cabin surroundings.

Over the next 12 months, LCCs are predicted to continue to chip away at their bigger rivals’ market share, with Saudi Arabian Airlines’ LCC subsidiary, flyadeal, leading this trend – becoming the region’s largest airline by seats in 2019 and recording a capacity growth of 78.1 per cent, according to the latest CAPA data.

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In addition, ATM is witnessing this trend first-hand, with LCCs including flydubai, flynas and flyadeal confirmed for the 2020 edition of the show.

Exhibition director – Middle East, ATM, Danielle Curtis commented: “Situated within eight-hours of two-thirds of the world’s population and located between the major cities of Europe in the northwest, the fast-developing East African cities in the west and India and Pakistan in the east – the Middle East is the ideal location to set up a budget airline, attracting passenger traffic from within the region as well as from across much of the eastern hemisphere.”

When compared to other parts of the world, there looks to be plenty of scope for growth for the Middle East’s LCCs. According to Boeing, 33 per cent of short-haul traffic globally is on no-thrills airlines, led by southeast Asia where the figure is 62 per cent. However, in the Middle East at present, this figure lies at 13 per cent.

Supporting LCCs’ potential for growth in the region, in October 2019, Air Arabia and Etihad Aviation Group announced strategic plans to launch a new budget carrier. Based out of Abu Dhabi Airport, Air Arabia Abu Dhabi will become the fifth airline to operate in the UAE and the capital’s first low-cost airline.

In the same month, Indian low-cost carrier, SpiceJet, announced plans to launch an airline that will be based at Ras Al Khaimah International Airport, following the signing of a MoU with the airport to start direct flights between RAK and New Delhi.

Looking ahead to ATM 2020, aviation will feature heavily in the programme, with a keynote from Emirates Airline’s president, Sir Tim Clark, entitled ‘The Making of Emirates: The Legacy of Sir Tim Clark’, taking place on the Global stage on Monday April 20, 2020. In this exclusive one-to-one, Clark will look to the future in what will be one of his final interviews before stepping down from his role in June.