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Fri 5 Feb 2016 12:57 AM

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MidEast airlines overtake US rivals for global market share amid ongoing spat

Middle East air traffic growth leads world in 2015, taking 14.2% market share as dispute between Gulf and US carriers rumbles on

MidEast airlines overtake US rivals for global market share amid ongoing spat

Gulf airlines led the world for annual traffic growth during 2015 as their share of international traffic increased to more than 14 percent, according to new figures released by the International Air Transport Association (IATA).

The Middle East region's 14.2 percent market share eclipsed that of their North American counterparts (13.4 percent) at a time of a continuing spat over between the ‘big three’ US airlines and the Gulf trio of Emirates, Etihad and Qatar Airways.

The dispute intensified last week following a claim by the Partnership for Open and Fair Skies, a lobby group for Delta, American Airlines and United, that there has been a “steep decline” in international bookings from airports where the GCC carriers have recently launched services.

According to IATA, Middle East carriers saw annual traffic growth of 10.5 percent last year and capacity growth of 13.2 percent which exceeded the demand gains, pushing down load factor 1.7 percent to 76.4 percent.

Globally, IATA said demand (measured in revenue passenger kilometres or RPKs) rose 6.5 percent for the full year compared to 2014.

This was the strongest result since the post-global financial crisis rebound in 2010 and well above the 10-year average annual growth rate of 5.5 percent.

IATA said that while economic fundamentals were weaker in 2015 compared to 2014, passenger demand was boosted by lower airfares. After adjusting for distortions caused by the rise of the US dollar, global airfares last year were approximately 5 percent lower than in 2014.

"Last year’s very strong performance, against a weaker economic backdrop, confirms the strong demand for aviation connectivity. But even as the appetite for air travel increased, consumers benefitted from lower fares compared to 2014," said Tony Tyler, IATA’s director general and CEO.

Annual capacity rose 5.6 percent last year, with the result that load factor climbed 0.6 percent to a record annual high of 80.3 percent. All regions experienced positive traffic growth in 2015 while carriers in the Asia-Pacific region accounted for one-third of the total annual increase in traffic.

Tyler added: "Aviation delivered strong results for the global economy in 2015, enabling connectivity and helping to drive economic development.

"It is very disappointing to see that some governments still wrongly believe that the value of taxes and charges that can be extracted from air transport outweighs the benefits—economic and social—of connectivity."

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