Jet mystery unfolds as Asian air travel booms

 

Hong Kong: The transfixing mystery of the Malaysia Airlines jet that went missing with 239 people on board has unfolded in a region where air travel is undergoing supercharged growth after decades of being beyond the reach of most people.

 

The still unknown fate of Flight 370, which vanished from civilian radar on a nighttime flight from Kuala Lumpur to Beijing on March 8, has riveted the flying public and baffled experts. The backdrop is also compelling even if far removed from the headlines.

 

Air travel in Asia is surging as the middle class gets bigger, discount airlines proliferate and business ties with the rest of the world deepen. Airports are scrambling to expand as they bulge with passengers and an upstart Indonesian carrier has given Boeing and Airbus their biggest jet orders ever.

 

The region's economic boom, seeded in the early 1990s by China's embrace of market style reforms, is the underlying reason.

 

"When you're poor you can't afford to fly," said Andrew Herdman, director general of the Association of Asia Pacific Airlines. "The big development of the demographics of Asia in the past 20 years has been the sheer number of people who have been lifted out of poverty into that middle income segment" of $10-$100 of disposable income a day.

 

The International Air Transport Association has forecast airline passengers to grow by 31 percent worldwide between 2012 and 2017. For Asia, that will mean the number of passengers increases an average of 6.3 percent each year, nearly three times as fast at the U.S.

 

Routes within or connected to China will be the single largest driver of growth, accounting for nearly a quarter of the additional 300 million passengers during those six years.

 

Whether the Malaysia Airlines jet succumbed to a sudden catastrophe, hijacking or malicious pilot action, it is unlikely to change a two decade trend of ever more travelers, routes and planes.

 

"People become cautious about a particular airline for a while but you don't see travel patterns change," said Herdman.

 

Asian demand is a big reason why airlines are on the largest jet-buying spree in aviation history, ordering more than 8,200 new planes from Airbus and Boeing in the past five years. There are now 24 planes rolling off assembly lines each week, up from 11 a decade ago. And that rate is expected to keep climbing.

 

The bulk of the planes are going to new or quickly-growing airlines that serve the expanding middle class in China, India and Southeast Asia.

 

In Asia alone, Airbus has 1,375 unfilled airplane orders or about a quarter of its worldwide order book.

The low cost carriers are the hungriest buyers. Malaysia-based AirAsia and its affiliate AirAsia X together have orders for 385 new planes. Those new planes alone have enough seats to put an additional 60,000 passengers in the sky at the same time. Many of those planes will make multiple flights a day, sending that figure even higher.

 

Indonesia's Lion Air has an order for 234 jets from Airbus and another 301 from Boeing. That's in additional to the 107 Boeing jets it currently flies.

 

They're just two of the numerous low budget airlines that have opened up in the past decade, mostly in Southeast Asia, to service the growing demand for affordable air travel.

 

Even China, which for years has enforced restrictive policies aimed at supporting the three dominant state-owned carriers, is starting to give budget airlines a chance.

 

Last month, China's aviation regulator, the Civil Aviation Administration of China, said it would lower barriers for setting up a low cost airline, simplify approval procedures, cut charges for airports in lower-tier cities and encourage older airports to revamp terminals for budget carriers.

 

"The reins are loosened," said Will Horton, an analyst at CAPA The Center for Aviation.

To keep up, Asian governments are scrambling to build new terminals and runways.

 

Singapore, a wealthy city-state off the southern tip of peninsular Malaysia, expects additions to its airport will within a decade more than double the number of passengers it can handle yearly to 135 million.

 

Airport construction is most rampant in China, with authorities in the world's second-biggest economy authorizing the construction of dozens of new airports and the expansion of others.

 

"It is clear that airport infrastructure must be expanded to accommodate demand," said Campbell Wilson, CEO of Singapore-based budget carrier Scoot.

 

He said several airports in the region are already operating near or at capacity including Hong Kong, Bangkok's Suvarnabhumi, Manila, Jakarta and Beijing.

 

"Many more airports will soon reach their limits," said Wilson.