The comprehensive airfare analysis, conducted by ACI APAC & MID in collaboration with Flare Aviation Consulting, assessed fare trends across roughly 60,000 routes spanning 19 countries from 2019 to 2024. This study offered valuable insights into the recovery of air travel in the region following the pandemic.
Although international air traffic is rebounding, with seat capacity expected to surpass pre-pandemic levels by the end of the year, airfares have remained over 10% higher in various markets.
Airfare Increases Observed Across Markets
The analysis highlighted significant increases in domestic airfare during the first half of 2024 compared to 2019. Substantial fare hikes were observed in major domestic markets, including India (+43%), Vietnam (+63%), Malaysia (+36%), Thailand (+26%), and Australia (+21%), all of which have a strong reliance on domestic air travel.
Even with the expected resurgence of international seat availability in these nations, airfares are still higher than pre-pandemic prices. In India and Vietnam, international airfare saw a 16% rise, in Malaysia 21%, Australia 14%, and Thailand 7%, with low-cost carriers (LCCs) largely driving these increases.
The study also pointed out that LCCs in the Asia-Pacific region have shown impressive resilience in the wake of the COVID-19 crisis, expanding their market share and strengthening their position, further impacting overall airfare trends.
Middle East Perspective
In the Middle East, most countries saw traffic volumes exceed pre-pandemic levels by the second quarter of 2024. Nations like Bahrain (+24%), Qatar (+27%), Saudi Arabia (+30%), and the United Arab Emirates (+39%) experienced significant growth in traffic. However, despite this recovery, international airfare in certain countries remains elevated, with fares in the UAE increasing by 22% and Oman by 10%.
Commenting on the study, Mr. Emmanuel Menanteau, President of ACI Asia-Pacific & Middle East and Regional Director, VINCI Airports, said: “Affordable airfares is crucial not only for ensuring accessibility to air travel but also for supporting the economic vitality of our communities. Excessive fare increases can discourage passengers, hinder connectivity, and ultimately impact the growth of our sector. It is critical to keep air travel within reach for all, allowing our airports and local economies to thrive together.”
Mr. Stefano Baronci, Director General, ACI Asia-Pacific & Middle East, said: “While passenger numbers in Asia-Pacific are returning to pre-pandemic levels this year, many travelers are paying significantly more, especially on domestic routes. This indicates that the demand for air travel is likely higher than in 2019. We must ensure that rising airfares do not become a barrier for potential customers. Passengers deserve transparency about these costs. Airfares result from a complex pricing system set by airlines, influenced by demand and supply, price elasticity, competition on any given route. For example, routes that are reliant on a single airline saw fare increases of over 25%, while those with steady competition experienced only about a 10% rise.”
“It is important to note that the increase in airfares is not related to airport charges. Considering the airlines’ cost structure, fuel prices and inflation have a much greater impact than airport charges. For a long time, airport charges have represented a stable component of airlines’ operating costs, averaging around 4%. From 2019 to 2024, airport charges have decreased by 7% for domestic flights and increased by only 6% for international flights, making their influence on the recent spike in airfares in the region negligible,” Mr. Baronci added.
Tags: Emmanuel Menanteau, ACI Asia-Pacific and Middle East, Stefano Baronci
