Middle East commercial fleet to grow 5.1% annually: Oliver Wyman
Representing just over 60% of this market, Saudi Arabia and the UAE are leaders of this growth in the region, with carriers in each serving the market differently.
The Middle East commercial aviation market is expected to trend upward, supported by a growing demand for air travel, budget carriers entering the market, and significant aircraft orders, according to Oliver Wyman, a leading international management consulting firm.
The region's fleet is projected to grow at an annual 5.1%, driven primarily by narrow bodies; it said its latest report.
In a region where wide bodies have long dominated, the report said narrow bodies will climb from 43% to 47% of the fleet over the decade, equalling wide bodies' share of the fleet.
Representing just over 60% of this market, Saudi Arabia and the UAE are leaders of this growth in the region, with carriers in each serving the market differently.
In Saudi Arabia, domestic flying makes up 45% of seats whereas the UAE air travel is solely based on international traffic. Both countries have plans to significantly grow and monetise their aviation-related assets.
In Saudi Arabia, the Vision 2030 plan seeks to diversify the economy through investment, especially targeting growth in tourism.
The next largest is Qatar, representing another 15% of the market, it said, adding the market has essentially doubled its capacity every six years.
Despite this growth, the region has struggled with profitability given the competitive nature of the market and the domination of Emirates and Qatar Airways in the region, particularly when it comes to product offerings.
The global fleet is projected to exceed 38,300 aircraft by 2035, with production challenges prompting airlines to delay retiring older planes, pushing up the average age of the fleet. Narrow body aircraft will continue to dominate the future fleet, with the share increasing from 62% to 68% by 2035.
North America will continue to remain the largest market, but emerging regions like China, India, and the Middle East are expected to capture a larger share, highlighting the shifting dynamics in the global aviation sector, according to the report.
The Middle East will continue to see its global maintenance, repair and overhaul (MRO) market share increase, driven by a large order book, especially for the narrow body A320 and 737 MAX aircraft.
Legacy wide body fleet types, such as the A380 and 777, will raise MRO demand, along with new entrants including the A350 and 777X.
While currently comparable in market size to Asia's MRO demand, MRO in the Middle East will grow at a slightly more modest annual rate of 2.4% over the next 10 years, the report said.
Despite this lower rate, the (Middle East) region will gain 25% in market size by the end of the forecast period.
© Gulf Times Newspaper 2022 Provided by SyndiGate Media Inc. (Syndigate.info).
Santhosh V. Perumal
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