State of Global Air Transport and ICAO Forecasts for · PDF file · 2017-12-14Freight Tonne-Kilometres ... The size of the industry in 2016 . 1,400 + SCHEDULED AIRLINES . 4,130 +

State of Global Air Transport and ICAO Forecasts for

Effective Planning

Economic Development Air Transport Bureau

ICAO

State of Air Transport Industry in 2016

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Freight Tonne-Kilometres

(billion)

Growth of air transport

Scheduled commercial traffic Total (international and domestic) services 3 Source: ICAO Annual Report of the Council

205 billion FTK

+3.8% vs. 2015

7.1 trillion RPK

+7.4% growth rate vs. 2015

Scheduled commercial traffic Total (international and domestic) services 4 Source: ICAO Annual Report of the Council

The size of the industry in 2016

1,400 + SCHEDULED AIRLINES

4,130 + AIRPORTS

For the 2 largest aircraft manufacturers (Airbus and Boeing) in 2016: • 1520 new aircraft delivered • Net orders for 1555 aircraft Book to bill ratio = orders / deliveries Book to bill ratio declined from 1.3:1 in 2015 to 1:1 in 2016, reflecting slowing orders to deliveries.

Airline fleet

Source: ICAO, Reed Business Information (RBI) 5

0

5,000

10,000

15,000

20,000

25,000

30,000

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Commercial fleet evolution

Turbojet Turboprop

Source: ICAO

Share of Traffic in RTKs by region in 2016

6 Scheduled commercial traffic measured in Revenue Tonne-Kilometres

Passenger traffic distribution

Domestic International

2005

Domestic 41% International 59%

Source: ICAO Annual Report of the Council

2016


Scheduled commercial traffic measured in Revenue Passenger-Kilometres 7

EUR 9%

AFR 1%

MID 1%

APAC 23%

NA 62%

LAC 4%

EUR 40%

AFR 3%

MID 7%

APAC 28%

NA 18%

LAC 4%

Europe 37%

AFR 3%

MID 14%

APAC 29%

NA 13%

LAC 4%

EUR 9% AFR

1% MID 1%

APAC 40% NA

42%

LAC 7%

Domestic International

Source: ICAO Annual Report of the Council

2005


2016


Scheduled commercial traffic measured in Freight Tonnes-Kilometres 8

EUR 31%

AFR 2%

MID 8%

APAC 38%

NA 18%

LAC 3%

EUR 4% AFR 0%

MID 1%

APAC 21% NA

71%

LAC 3%

Freight traffic distribution

EUR 4% AFR

0% MID 0%

APAC 34%

NA 59%

LAC 3%

EUR 26%

AFR 2%

MID 16%

APAC 40%

NA 13%

LAC 3%

Source: ACI

States traffic rankings in 2015-16

9

International Scheduled Revenue Tonne-Kilometres (RTK)

Rank State Percentage Increase in ASK

1 China 13% 2 USA 7% 3 United Kingdom 7% 4 Spain 14% 5 United Arab Emirates 8% 6 Qatar 22% 7 Australia 11% 8 Canada 11% 9 Thailand 9%

10 Germany 4% 11 Republic of Korea 9% 12 Saudi Arabia 14% 13 Italy 9% 14 India 9% 15 Japan 4% 16 New Zealand 22% 17 Netherlands 7% 18 Philippines 14% 19 Mexico 9%

International capacity growth – Top States in terms of ASK Growth Top 20 new routes in ASK in 2016

City Pair Country Pair Doha - Sydney (AU) Qatar - Australia Doha - Los Angeles Qatar - USA

Doha - Boston Qatar - USA Atlanta - Doha USA - Qatar

Adelaide - Doha Australia - Qatar Dubai - Cebu United Arab Emirates - Philippines

Atlanta - Istanbul USA - Turkey Angeles/Mabalacat - Dubai Philippines - United Arab Emirates

Rome (IT) - Santiago (CL) Italy - Chile Vancouver - Brisbane Canada - Australia

Vienna - Shanghai Austria - China Shanghai - Madrid China - Spain Cebu - Los Angeles Philippines - USA Munich - Denver Germany - USA Warsaw - Tokyo Poland - Japan

Reykjavik - San Francisco Iceland - USA Panama City (PA) - Istanbul Panama - Turkey

Istanbul - Bogota Turkey - Colombia Los Angeles - Reykjavik USA - Iceland Shenzhen - Sydney (AU) China - Australia

Capacity growth stimulating traffic

10 Source: ICAO ASK: Available Seat-Kilometres

12.8%

26.8%

34.6% 32.2%

12.7%

29.5% 28.8%

0%

5%

10%

15%

20%

25%

30%

35%

40%

Africa Asia andPacific

Europe LatinAmerica /Caribbean

MiddleEast

NorthAmerica

World

Share of passengers carried by LCCs in 2016

Low-cost carriers (LCCs) stimulating traffic

Source: ICAO

2015 2016 LCCs 11.4% 10.5% Others 5.1% 4.2% Total 7.2% 6.8%

Passenger number growth for LCCs and other carriers

LCCs growth has been consistently twice as much as other carriers’ growth

11

Source: ICAO Annual Report of the Council, ACI

Top 20 airports in 2016 passenger traffic

12

Air 55%

Road 39%

Rail 2%

Water 4%

• Tourism expansion relies heavily on air transport, providing substantial economic benefits for anyone involved in the value chain of tourism

Inbound tourism by mode of transport 2016

Source: World Tourism Organization (UNWTO)

More than half of international tourists arrive by air

City and airport code Freight tonnes 2016/2015

2016 (%) 1 Hong Kong (HKG) 4,521,028 +3.2% 2 Memphis (MEM) 4,312,884 +0.5% 3 Shanghai (PVG) 3,343,502 +5.1% 4 Incheon (ICN) 2,602,679 +4.5% 5 Dubai (DXB) 2,592,454 +3.4% 6 Anchorage (ANC) 2,542,526 -3.4% 7 Louisville (SDF) 2,340,553 +3.4% 8 Tokyo (NRT) 2,130,847 +2.2% 9 Taipei (TPE) 2,081,043 +3.8%

10 Frankfurt (FRA) 2,029,058 +1.8% 11 Miami (MIA) 1,977,881 +0.4% 12 Singapore (SIN) 1,969,400 +6.3% 13 Paris (CDG) 1,952,935 +2.7% 14 Beijing (PEK) 1,943,159 +2.8% 15 Los Angeles (LAX) 1,903,155 +2.8%

Source: ICAO Annual Report of the Council, ACI 14

Top 15 airports in 2016

cargo traffic

Volume of world international cargo shipment

Value of world international cargo shipment

Aviation Aviation

Surface modes

Surface modes

15 Source: Air Transport Action Group (ATAG), 2016

One third of the value of world trade

is shipped by air

0.5% 34.6%

0%

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20%

30%

40%

50%

60%

70%

80%

90%

100%

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Prop

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Tot

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TK

Mail Tonnes Kilometres (MTK) Breakdown

Air E-Commerce* OTHER

16%

83%

91%

• E-commerce share of MTKs grew from 16% to 83% between 2010 and 2016 and is estimated to grow to 91% by 2025

* Air E-Commerce is estimated assuming parcels traveling a distance of above 1000 kilometres are delivered by air

78.0%

80.0%

82.0%

84.0%

86.0%

88.0%

90.0%

2010 2011 2012 2013 2014 2015 2016

Percentage of E-Commerce Parcels Carried by Air

• Approximately 90% of e-commerce parcels were carried by air in 2016

E-commerce development

Financial Performance

17

24.2%

17.7%

50.4%

Africa

Asia-Pacific

Europe

Latin America &Caribbean

Middle East

North America

Share of Operating Profits - 2016

Total operating profits - USD 65 billion in 2016

Airline operating results in 2016: US$ 68 billion operating profit

With 22.4% of global traffic, airlines of North America generated more than half of global operating profits

ICAO Long-term Traffic Forecasts

• The forecasts are critical to: – infrastructure planning and capacity building for improved safety of operations – assess the operational and cost-effectiveness of air navigation systems including the Aviation System

Block Upgrades (ASBU) – assess licensed personnel and training requirement – estimate future trends of noise, emissions and particulate matter – effectively implement ICAO’s No Country Left Behind (NCLB) initiative

• A38-14: Develop and maintain Long Term Traffic Forecasts, from which customized or more detailed forecasts can be produced for various purposes, such as air navigation systems planning and environmental analysis

• The development of the forecasts has taken into account the needs of States and the Organization and various ICAO entities.

19

Needs and Development of Long-Term Traffic Forecasts (LTF)

ECONOMIC DEVELOPMENT

Main source: ICAO Air Transport Reporting Forms A, B and C submitted by States Completed with data from national offices of statistics:

20

Data sources

US Department of Transportation (Bureau of Transportation Statistics)

Bureau of Infrastructure, Transport and Regional Economics (Australia)

Official Airline Guide (OAG)

AvStats (UK CAA)

90% of scheduled international passenger and 95% of Freight traffic covered by reported traffic

Cleaned OAG used to complement the data to arrive at 100% coverage

ECONOMIC DEVELOPMENT Data sources for the Forecasts

Factors influencing air traffic demand

Air Traffic Demand = Function (Economic Growth, Cost, non-economic events …..) Macro-economic factors • GDP per capita (More disposable income per capita, higher demand for leisure travel) • Employment (Increasing economic activity and employment generating higher demand for business travel) • Population growth (Increasing population can drive travel demand) • International Trade (Cargo) Micro-economic factors (cost of travel) • Regulations (market access/ticket prices) • Infrastructure (transportation network, connections to airport, air traffic control, etc.) • Market structure (extent of airline competition) • Input costs (fuel, capital costs, labor costs etc.) Random non-economic factors • 2001 9/11 (North America and connected routes) • 2003 SARS (Asia and connected routes) • 2010 Iceland Volcano (Europe and connected routes) • 2011 Tsunami (Japan and connected routes)

21

22

Econometrics Modeling

Utilized panel model approach

Overcomes time series limitations and allows for using the entire dataset

ECONOMIC DEVELOPMENT Passenger Traffic Demand Model

50 Route Groups 900 Observations

Passenger traffic demand model

24

• Forecast at regional level • Africa • Asia and Pacific • Europe • Latin America and the Caribbean • Middle East • North America

• Model Specification

• Individual ordinary least squares (OLS) regression was used for each region as it performed better than other approaches

• GDP and oil prices main explanatory variables

Cargo Traffic Demand Model ECONOMIC DEVELOPMENT

Cargo traffic demand model

25

Global Passenger Traffic Forecasts

0

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22

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040

Reve

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Pass

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r Kilo

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PK)

(tril

lions

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International Domestic

History

Forecast

1995-2012 5.2%

2012-2032 4.6%

2012-2042 4.5%

38%

62%

59%

41%

42%

58%

Scheduled Services


26

Africa

0 50 100 150 200 250

Africa - Middle East

Europe - Sub Saharan Africa

Europe - North Africa

Africa - Asia/Pacific

Intra Africa

Africa Domestic

Africa - North America

Africa & Middle East - South America

Africa & Middle East - CentralAmerica/Caribbean

Revenue Passenger-Kilometres (RPK) (billion)

2042 2032 2012

4.7%

2.0%

3.3%

5.8%

4.3%

4.3%

3.1%

4.2%

4.3%

4.9%

2.1%

3.3%

6.1%

4.5%

4.5%

3.1%

3.8%

4.4%

11.9%

4.6%

8.6%

7.9%

7.1%

3.6%

8.3%

12.2%

19.2%

CAGR*

2012-2042 2012-2032 1995-2012

*CAGR: Compound Annual Growth Rate


27

Asia/Pacific

0 1,000 2,000 3,000 4,000 5,000

Central South West Asia Domestic

Central South West Asia - Pacific South East Asia

Central South West Asia - Middle East

Pacific South East Asia Domestic

Central South West Asia - Europe

Intra Pacific South East Asia

Central South West Asia - North America

Central South West Asia - North Asia

Europe - Pacific South East Asia

Intra Central South West Asia

Middle East - North Asia & Pacific South East Asia

North Asia - Pacific South East Asia

North America - North Asia

North America - Pacific South East Asia

Europe - North Asia

North Asia Domestic

Africa - Asia/Pacific

Intra North Asia

Latin America/Caribbean - North Asia & Pacific South East…


2042 2032 2012

7.6%

7.4%

8.2%

5.1%

4.7%

5.1%

5.5%

7.7%

3.6%

7.7%

3.5%

3.6%

2.5%

4.1%

2.2%

1.4%

5.8%

1.4%

2.7%

8.8%

7.9%

8.6%

5.3%

5.2%

5.3%

6.3%

8.4%

3.8%

8.7%

3.7%

3.8%

2.6%

4.3%

2.3%

1.6%

6.1%

1.6%

2.9%

12.5%

6.8%

9.9%

8.1%

8.3%

4.7%

6.5%

5.1%

3.8%

9.3%

11.3%

2.3%

0.7%

3.9%

2.5%

0.7%

7.9%

4.4%

11.2%

CAGR*

2012-2042 2012-2032 1995-2012



28

Europe

0 400 800 1,200

Intra Europe

Europe - North America

Central South West Asia - Europe

Europe Domestic

Europe - Middle East

Europe - Pacific South East Asia

Europe - South America

Europe - Sub Saharan Africa

Central America/Caribbean - Europe

Europe - North Africa

Europe - North Asia


2042 2032 2012

3.5%

3.7%

2.9%

3.5%

2.9%

4.2%

3.5%

4.0%

4.2%

4.2%

2.7%

6.7%

4.3%

3.2%

4.0%

3.0%

3.7%

3.2%

4.2%

3.2%

3.8%

4.2%

3.8%

2.9%

7.7%

4.4%

9.3%

6.1%

6.8%

4.4%

7.2%

5.1%

6.8%

10.6%

3.4%

12.2%

11.2%

0.0%

19.2%

CAGR*

2012-2042 2012-2032 1995-2012



29

Latin America and the Caribbean

0 100 200 300 400

South America Domestic

Central America/Caribbean - North America

Europe - South America

North America - South America

Central America/Caribbean - Europe

Central America/Caribbean Domestic

Intra South America

Central America/Caribbean - South America

Intra Central America/Caribbean


Latin America/Caribbean - North Asia & Pacific…

Latin America/Caribbean - Central South West Asia

Africa & Middle East - Central America/Caribbean


2042 2032 2012

3.5%

3.7%

2.9%

3.5%

2.9%

4.2%

3.5%

4.0%

4.2%

4.2%

2.7%

6.7%

4.3%

3.2%

4.0%

3.0%

3.7%

3.2%

4.2%

3.2%

3.8%

4.2%

3.8%

2.9%

7.7%

4.4%

9.3%

6.1%

6.8%

4.4%

7.2%

5.1%

6.8%

10.6%

3.4%

12.2%

11.2%

0.0%

19.2%

CAGR*

2012-2042 2012-2032 1995-2012



30

Middle East

0 300 600 900 1,200

Central South West Asia - Middle East

Europe - Middle East

Middle East - North Asia & Pacific South EastAsia

Africa - Middle East

Middle East - North America

Intra Middle East

Middle East Domestic


Africa & Middle East - CentralAmerica/Caribbean


2042 2032 2012

8.2%

2.9%

3.5%

4.7%

3.4%

4.4%

4.4%

4.2%

4.3%

8.6%

3.1%

3.7%

4.9%

3.6%

4.7%

4.7%

3.8%

4.4%

9.9%

8.8%

11.3%

11.9%

12.0%

10.2%

5.8%

12.2%

19.2%

CAGR*

2012-2042 2012-2032 1995-2012



31

North America

0 500 1,000 1,500 2,000 2,500

North America Domestic

Europe - North America

Central South West Asia - North America

Central America/Caribbean - North America

North America - North Asia

North America - South America

North America - Pacific South East Asia

Middle East - North America

Intra North America

Africa - North America


2042 2032 2012

2.9%

2.7%

5.5%

3.7%

2.5%

3.5%

4.1%

3.4%

2.9%

3.1%

3.0%

2.8%

6.3%

4.0%

2.6%

3.7%

4.3%

3.6%

3.0%

3.1%

2.5%

3.1%

6.5%

6.1%

0.7%

4.4%

3.9%

12.0%

4.9%

8.3%

CAGR*

2012-2042 2012-2032 1995-2012



32

Cargo Traffic Forecasts

Summary of Total Cargo Traffic Forecasts by Region of Airline Registration

(Scheduled Services) Cargo traffic results in terms of FTKs

Region CAGR*

Flight Stage 2012-2022 2012-2032 2012-2042

Europe Total 2.9% 2.6% 2.4%

International 2.9% 2.6% 2.4%

Domestic 0.2% 0.8% 1.0%

Africa Total 1.6% 2.1% 2.2%


Domestic 0.3% 0.1% 0.1%

Middle East Total 6.6% 7.1% 6.9%


Domestic 1.4% 0.7% 0.5%

Asia and Pacific Total 5.7% 5.1% 4.7%


Domestic 8.7% 7.8% 7.0%

North America Total 2.7% 2.5% 2.6%


Domestic 0.8% 0.7% 0.6%

Latin America and the Caribbean Total 3.1% 2.9% 2.8%


Domestic 2.0% 1.7% 1.6%

WORLD Total scheduled 4.4% 4.3% 4.2%


Domestic 3.9% 4.0% 4.0%


33

Forecast for Aviation Planning

Use of traffic forecasts

Air navigation systems planning Aircraft movements

Airport planning Aircraft movements Airport passengers Licensed personnel

Airline planning Planning of routes and services

Fleet planning Estimation of airline’s market share


Forecasts can be used as the base to produce customized or more detailed forecasts for various purposes, such as air navigation systems planning, airport planning as well as airline planning.

Forecasts can also serve as an input to environment for critical tasks such as trend analysis, assessment and development of fleet forecasts.

• Develop an electronic interface allowing States and other users to generate customized forecasts at different levels of granularity (for example, by route, by country-pair, by State of departure, by airport);

• Customize forecast results/data required for the Environment to develop its fleet forecasts, trends and assessment activities;

• Customize forecast results/data required for air navigation service planning and assessment activities at a global and regional level; and

• Updated global and regional twenty year forecasts for pilots, maintenance personnel and air traffic controllers (DOC 9956) in April 2018 to meet the needs of the ICAO Next Generation Aviation Professional (NGAP) programme.

34

Future work in aviation forecasts


Aviation data partnership


Publications

State of Air Transport Aviation Benefits

Documents

State of Global Air Transport and ICAO Forecasts for · PDF file · 2017-12-14Freight Tonne-Kilometres ... The size of the industry in 2016 . 1,400 + SCHEDULED AIRLINES . 4,130 +