MANILA, Philippines - The low cost carrier (LCC) fleet in the Southeast Asian region grew 13 percent in 2015 and has expanded by 50 percent in the last three years, the Center for Asia Pacific Aviation (CAPA) reported.
In its latest industry report, CAPA said Southeast Asia’s LCC fleet ended 2015 with 609 or 70 more than the previous year’s tally.
Budget carrier Cebu Pacific Air ranked fourth among LCCs in Southeast Asia with a total of 47 aircraft in its fleet from 41 in 2013 while its subsidiary CebGo landed on the 18th spot with eight aircraft from five in 2013.
Philippines’ AirAsia, however, has seen consistently decreased its fleet since 2013 from 17 to its existing 13 aircraft. It ranked 15th.
Meanwhile, the turboprop segment grew 33 percent to 77 aircraft, with Lion Group subsidiary Wings Air accounting for almost all the additional aircraft.
CebGo, alongside Malindo Air and Golden Myanmar, also operates turboprop but did not add in its fleet in 2015.
LCC capacity growth within the region significantly slowed in 2015 for the second consecutive year, as several carriers made adjustments in response to challenging market conditions.
The AirAsia Group and some of the region’s smaller players slowed expansion, leading to a significant reduction in short haul LCC capacity growth in 2015.
“For the first time since the birth of LCCs in Southeast Asia 15 years ago there was a drop in the LCC penetration rate within Southeast Asia. There was faster LCC capacity growth in medium and long haul markets connecting Southeast Asia with other regions, driven by a 31 percent expansion of the Southeast Asian LCC wide-body fleet,”CAPA said.
CAPA expects about 70 to 80 aircraft will be added to the Southeast Asian LCC fleet this year, resulting in a similar rate of fleet growth as in 2015.
“The long term outlook for Southeast Asia’s LCC sector remains bright as long as the airline groups continue to make adjustments, avoid aggressive expansion in saturated markets, and direct growth to markets where there are better opportunities,” CAPA said.
CAPA noted 2016 would likely experience a similar trend line, with relatively slow LCC capacity growth within the region and more rapid growth on routes connecting Southeast Asia with other regions in the Asia Pacific.
“But, there are still opportunities for short haul LCC growth within Southeast Asia as the overall market continues to grow, boosted by economic growth and expansion of the region’s middle class population,” it added.