Since 2005, Asia’s commercial fleets have grown by over 500 aircraft, with the number of intra-regional routes increasing threefold, from 255 to 734 in 2012. The region’s airlines are expected to add almost 10,000 more new aircraft to their fleets over the next 20 years, according to Airbus’s Global Market Forecast 2012–2031.

The increase in air travel has brought multiple socio-economic benefits to businesses, governments and the general public alike, but the sector’s rise has been challenging for the aviation industry. Asia’s airports are already deemed ‘overcrowded’, with sector analysts questioning how the industry will cater for future expansion. According to a 2012 Credit Suisse report, most of the region’s airports have already reached maximum capacity, but continue to encourage more air traffic. Shanghai’s Pudong International Airport, one of East Asia’s biggest regional hubs, saw a 26% rise in air traffic in 2010 alone, and is expecting a 10% growth rate over the next five years.

Safety remains a key concern. According to a 2012 report by the International Civil Aviation Organization (ICAO), maintaining high standards of safety has proved highly troublesome region-wide due to the sheer increase in air traffic numbers at some of Asia’s air hubs. Unless both regulators and airlines act soon, the number of air and ground incidents will significantly increase as more aircrafts enter the market.

In a bid to calm such fears, many Asian hubs are looking at ways to increase air traffic capacity, while simultaneously making their airports and surrounding skies safer.

Both Hong Kong and Singapore recently launched initiatives aimed at achieving this, and both airports are now equipped to comfortably grow air traffic volumes by between 4–5% over the next decade.  

Low-cost carriers

Asia’s ever-increasing number of LCCs has significantly affected the development of both the airline industry and airports. According to Airbus, LCCs represent over 20% of today’s market, and this percentage is predicted to rise over the next 20 years. Initially, the region’s national carriers were unable to compete with the burgeoning success of LCCs.

Yet, many national carriers now own or part-own LCCs, including Singapore Airlines’ Scoot, Qantas’ JetStar Airways and Malaysia Airlines’ Firefly. Despite the successes of their respective LCCs, many national carriers have struggled to adapt to today’s market conditions, which are characterised by high overheads and low-priced fares. 

However, when LLCs add new, ‘off-piste’ locations to their flight routes, these destinations see an economic impact. The Malaysian town of Tawau reported increased tourism after Malaysian budget carrier Air Asia began flying there in 2002.  

Talent

Core to the industry’s growth prospects is talent attraction and retention. However, attracting talent, especially pilots and aerospace engineers, will be a challenge.

The ICAO estimates Asia will experience a shortfall of about 9,000 new pilots a year through to 2031, and carriers must recruit around 230,000 new pilots across Asia over the next two decades. The ICAO also predicts pilot salaries will rocket in the forthcoming years. “The aviation sector, like many other technology-based sectors faces a talent shortage. As Asia continues to grow, there is increasing demand for skilled and experienced management level employees,” said Timothy Lynch, Asia Pacific HR Director at Boeing. 

In a bid to develop a pipeline of fully qualified pilots, many carriers – including Air Asia and Singapore Airlines – have now set up tuition-free programmes where graduates receive complimentary training, on condition of staying with the same airline for a fixed period post-graduation.

Aerospace firms face a potentially even graver talent shortage, with Boeing forecasting the region will require a further 250,000 fully trained engineers over the next two decades . “Asia's aerospace industry is developing in tandem with the region's increasing demand for air transport services,” said Jonathan Asherton, Regional Director, ASEAN & Pacific, Rolls-Royce. “There is now a heightened requirement for specialised skills.”

To counter today’s talent challenges, Rolls-Royce has rolled out numerous partnerships aimed at attracting and developing its Asian talent pool. “In Singapore, we work closely with government, local partners and educational institutes to develop internationally-recognised qualifications and degree programmes.” said Asherton. Today’s shortage of aerospace engineers is not just an issue for Asia. “In France, for example, we have no trouble finding people, but for certain specialised roles such as aircraft systems engineers, structure engineers and supply chain specialists, the market is very tight,” said Thierry Baril, Chief HR Officer, Airbus.

“We need to work hard to attract more people to the industry, most notably young people. We are enhancing our efforts to reach people at an early age. This includes getting more young women interested in our business,” said Baril.  

Towards a sustainable future

Asia’s aviation sector is set to grow by astronomic proportions over the next 20 years. While this bodes well for the region’s economy, it will place a huge strain on the area’s air traffic management systems and other market participants. Key to the industry fulfilling its promise of a prosperous future is manpower, and the sector must employ effective, robust strategies to attract the calibre of talent required to fuel growth.

This article was first published in HQ Asia (Print) Issue 06 (2013)