presented by aaco secretary general abdul wahab teffahaaaco members major additions by type in 2018...
TRANSCRIPT
29 April 2019 - Dubai
Presented by AACO Secretary General
Abdul Wahab Teffaha
ECONOMIC UPDATE
GLOBAL AIR TRAVEL MARKET
ARAB AIR TRAVEL MARKET
ARAB AIRPORTS
ARAB AIRLINES
ARAB AVIATION OUTLOOK
0%
1%
2%
3%
4%
5%
6%
7%
8%
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019* 2020*
Source: AACO, IMF, World Bank
Year-on-Year Real GDP Growth (%)
World Arab World
*Estimated
*Measured by Purchasing Managers Index which tracks business confidence amongst managers at manufacturing,construction, and services firms, **Above 50 represents an expansion, below 50 represents a contraction when compared toprevious month
Source: AACO, Bloomberg
53.352.8
55.1
51.4
52.8
56.8
54.855.7
52.4
50
48
49
50
51
52
53
54
55
56
57
58
Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19
Business Confidence* (Deviations from 50**)
Global Germany Saudi Arabia UAE United Kingdom
Better oil prices and
bank mergersExtension of credit terms
Driven by the services sector in the AmericasThreat of tariffs
on the automotive industry
Brexit
Source: AACO, ATAG, IATA, IMF, World Bank, WTTC
Contribution to GDP isaround USD 164$ billion(7.8% of total GDP)
Economic multiplierof aviation is around1$:3$
Employs around 6million (5.0% oftotal employment)
Data provided for the Arab world isbased on 2017 figures. Calculatedbased on total contribution (somecountries include tourism effects)
Globally expected at1$:2.1$ in 2018
Globally 2.7$ trillion(3.6% of total GDP)
Globally 65.5 million(around 2% of totalemployment)
Source: AACO, IATA*Estimated
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019*
Global RPKs Growth Global ASKs Growth
Slower Growth
Brexit
?Trade
Tensions
?Economic slowdown
?
Source: AACO, IATA
168.9204.3 211.9 222.1 231.6 249.1 269.6 281.0
17.8
20.7 22.3 23.9 25.026.5
27.1 28.7
0%
3%
6%
9%
12%
15%
18%
21%
0
50
100
150
200
250
300
350
2011 2012 2013 2014 2015 2016 2017 2018
Mill
ion
Pass
enge
rs
Total International traffic (Left scale) Domestic Traffic (Left scale) Growth (Right scale)
Source: AACO, IATA*Arab World
With The Americas+4.5%/9.1M
(3.3%)
With Europe+11.2/99.8M
(35.5%)
With Asia+2.1%/102.4M
(36.5%)
Within the AW*-3.0%/59.5M
(21.1%)
With Sub-Saharan Africa+8.6%/10.2M
(3.6%)
Change/Total number of PAX (share of total market)
050
100150200250300350400450
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Mill
ions
Arab World International Passenger Traffic Forecast - optimistic
Forecast - current situation Forecast - difficult environment
Difficult environment: Trade tensions,economic downturn, neo-protectionism, andexpansion of threats
CAGR: compound annual growth rate CAGR: 8.3%
CAGR: 4.4%
CAGR: 2.0%
Source: AACO, IATA
Source: AACO, ACI
113.4
177.1
0
50
100
150
200
250
300
350
400
2003 2004 2005 2006 2007
192.2258.8
2008 2009 2010 2011 2012
Avg. growth +10.4%
Million Passengers
Avg. growth +8.0%
0%
2%
4%
6%
8%
10%
12%
2013 2014 2015 2016 2017
273.7
Avg. growth +6.8%
Growth
359.4
73%
74%
75%
76%
77%
0
200
400
600
800
1,000
1,200
2011 2012 2013 2014 2015 2016 2017 2018
Billions
RPKs (Left scale) ASKs (Left scale) PLF (Right scale)
Source: AACO
Source: AACO, IATA
100.8
124.7 131.0 139.3 144.9158.5 166.1 169.5
17.8
20.7 22.323.7 25.0
26.5 27.1 28.7
14.3
17.018.9
21.124.7
28.430.6 32.9
0%
5%
10%
15%
20%
25%
0
50
100
150
200
250
2011 2012 2013 2014 2015 2016 2017 2018
Mill
ion
Pass
enge
rs
Int'l To/From Domestic Transit Traffic Int'l To/From Growth Transit Growth Domestic Growth
Growth
0%2%4%6%8%
10%12%14%16%18%20%
2011 2012 2013 2014 2015 2016 2017 2018 Q1-2019*
Additions Share of Total Fleet Withdrawals Share of Total Fleet Fleet Growth (Y-o-Y)
Gap between fleet additions andwithdrawals tightened further in Q12019
Source: Flight Fleets Analyzer, AACO*comparison is between Q1-2019/Q1-2018
A320, -24, 10.5 yrs
A330, -23, 10.6 yrs
B737, -10, 14.3 yrs
B777, -19, 13.5 yrs
A319, -6, 14.7 yrs
A320, +31,3.4 yrs
B777, +31, 4.7 yrs
B787-9/10,+ 18,
0.4 yrs
A350-900/100, +15,
0.6 yrs
B737 Max 8, +14,
0.6 yrs
A380, +9, 1.6 yrs
A320 Neo, +2, 0.3 yrs
Data includes re-activated, freight converted, andleased-in aircraft
Data includes grounded, leased-out, and retiredaircraft
Source: AACO, Flight Fleets AnalyzerData label contains: A/C Type, Count, and Average Age
Avg. Age 3.9 years Avg. Age 13.3 years
AACO Members Major Additions by Type in 2018 AACO Members Major Withdrawals by Type in 2018
Optimistic
Expansion of liberalization
Peaceful resolutions of some conflicts
Due stakeholders’ consultations for user chargers
Taxation that don’t hinder tourism growth
Development of infrastructure that mitigates congestion
Pessimistic
Restrictions on market access
Expansion of instability
Unchecked user charges
Unchecked taxation policies
Limited development of infrastructure
Source: AACO, Eurostat, World Bank
Data has been recalculated to include current EU members
5.0%
6.5%
8.1%
3.2%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
1978-1987 1988-1997 1998-2007 2008-2017
European Union Total Passenger Traffic Change
Source: AACO, IATA
2011-4.1 percentage points
2012-2018 Avg.
Growth +7.6%
2004-2010Avg. Growth
+11.7%
Arab Air Transport Market Average Growth Rate before and after 2011
Airline Ticket Breakdown (Europe)
Base fare and other fees Airport Passenger Charges Taxes
90%
7%
3% 79%
15%
6%
Air fares declined while taxes and airport charges doubled in 10 years
Source: AACO, ACI, IATA
2006 2016
If taxes remained constant between 2006-2016:• On average ticket price would have been less by 17 Euros per one-way trip• Which should have Added 50 million passengers, resulting in additional 50
billion euros in European GDP and created 238,000 jobs
Impact of Average Dollar Spent in Aviation on the Economy
20181$:2.1$
20171$:2.5$
A weaker multiplier, reached 20-year median of 2.1 in 2018
20161$:3$
Source: AACO, IATACalculated based on spending from disposable income on travel
Success story: Dubai Airport Passenger Traffic and Capacity Evolution 1990-2018
Source: AACO, ACI, Dubai Airport
2 Million
10 Million
23 Million
60 Million
75 Million
93 Million
0
10
20
30
40
50
60
70
80
90
100
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Mill
ions
Dubai Airport Passengers Airport Capacity
Opening of Terminal 2
Opening of Terminal 1 + concourse C
Opening of Terminal 3 + concourses
A&B
Second Phase concourse A
Opening of concourse D
q In spite of a cloudy picture ahead, yet aviation proved to be resilient.
q Maturity of the market is not yet the case in the Arab World. Lower
growth is attributed to other factors.
q Government Policies are critical to expand Air Transports’ contribution
to sustainable development.