Low Cost Carrier Market Analysis

Changi Airport in Singapore has been a bustling hub, witnessing a significant surge in departure and arrival numbers over the past five years, welcoming approximately 68 million visitors. Notably, the main international routes showing robust growth rates of 12% for India and 10% for Japan have contributed to this upsurge. The airport has expanded its reach, connecting to seven new cities across China, India, Germany, and Poland. Moreover, collaborative efforts between the airport authority and travel agents to offer flight charter services from Singapore to China are poised to attract more air travel passengers. These initiatives are expected to substantiate the growth of the low-cost carrier (LCC) market over the study timeframe.

In 2017, Europe boasted a fleet of 136,000 aircraft, marking its status as the second-largest market for business jets following North America. About 17% of the global business jet deliveries were catered to Europe. This increase in the number of aircraft in the region has been aligned with the escalating count of air passengers.

Eurostat, the statistical office of the European Union (EU) States, reported a notable 3.7% increase in international intra-EU-28 passengers carried by air in 2019. Factors propelling this growth include the globalization of business operations, the surge in international and domestic tourism, and the burgeoning freight transport, all contributing significantly to regional growth.

The escalating demand to accommodate the soaring passenger traffic worldwide will inevitably lead to increased demand for aircraft deliveries and the maintenance of existing fleets. This surge will prompt a substantial need for aero structures in new aircraft and the replacement of current aircraft, thereby propelling the growth of the low-cost carrier (LCC) market.

Government initiatives aimed at enhancing regional connectivity have sparked substantial growth in passenger and cargo transport in countries like India, China, and Brazil. These initiatives have bolstered air connectivity, provided attractive travel destinations, competitive fare structures, and positive socio-economic contributions from the aviation sector. The International Civil Aviation Organization (ICAO) emphasizes the necessity for modernized air transport facilities and infrastructure to optimize benefits and sustain growth in the aviation sector.