Middle East passenger traffic set to soar - BCG Report

Middle_East__passengerEmirates has emerged from global recession with an enviable financial position, nearly tripling capacity and passenger revenues over the past five years - Image credit : priceit.in

Middle East passenger traffic is expected to reach 140mn by 2015 and Emirates is likely to become the world's largest widebody carrier, global management consulting firm The Boston Consulting Group (BCG) says in a new report.

It added that the other two Gulf carriers — Qatar Airways and Etihad Airways — would figure among the global top 20 airlines.

The report

The report, Middle Eastern Megacarriers: Gaining Altitude, also said that the Middle East has become well established as a hub for long-haul travel with increases between 2005 and 2015, reflecting a compound annual growth rate of 11 per cent.

It added that passenger flows in the region increased by 45mn over the period from 2005 through 2010, and are expected to increase by another 45mn over the next period, from 2010 through 2015.

Also, led by the three big Gulf carriers — Emirates, Qatar Airways and Etihad, airlines in the region are expected to triple their passenger capacity over the next 20 years.

"Because the Middle Eastern mega-carriers have been early developers of the region as an important hub for long-haul routes, and because they enjoy significant cost advantages, they are well positioned to compete aggressively with more financially constrained carriers," Rend Stephan, Partner & Managing Director in BCG, Middle East, said in the report.

The report also pointed out that Emirates has emerged from the global recession with an enviable financial position, nearly tripling capacity and passenger revenues over the past five years.


BCG estimates that Emirates will grow its capacity by nine to 12 per cent annually through 2015.

Addressing the challenge of Middle East carriers maintaining profitability, BCG said it anticipates that like most other hub carriers, the mega carriers will see their largest profits come primarily from point-to-point travellers.

"But the industry's saturation of this segment will force the mega-carriers to also pursue two other, more contested pools: passengers with short-haul connecting flights and intercontinental connecting passengers [who, in many cases, are unprofitable to serve]," the report stated.

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