Scheduled Passenger Air Transport in the UK Industry Market Research Report Now Updated by IBISWorld

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The past five years were extremely turbulent for airlines operating in the Scheduled Passenger Air Transport industry. IBISWorld estimates industry revenue will grow slowly at a compound annual rate of 1.2% over the five years through 2012-13 to reach £19.5 billion. The industry is slowly recovering, with revenue growth of 4.2% expected in 2012-13. With recovery uncertain in the eurozone, airlines will be nonetheless cautious about increasing capacity and are expected to offer further deals to attract consumers. The next five years will include a recovery period. Industry revenue is forecast to grow at a very marginal rate over the five years through 2017-18. Improving demand for air travel and rising prices will support revenue growth. Demand for air travel will be strongest from emerging economies as they will recover faster than the domestic economy. However, price competition will limit revenue growth. For these reasons, industry research firm IBISWorld has updated its report on the Scheduled Passenger Air Transport industry.

IBISWorld Market Research

IBISWorld Market Research

Rising prices and improving demand for travel will aid in industry recovery

The past five years were extremely turbulent for airlines operating in the Scheduled Passenger Air Transport industry. IBISWorld estimates industry revenue will grow slowly at a compound annual rate of 1.2% over the five years through 2012-13 to reach £19.5 billion. According to IBISWorld industry analyst Caroline Finch, “the industry is slowly recovering, with revenue growth of 4.2% expected in 2012-13”. With recovery uncertain in the eurozone, airlines will be nonetheless cautious about increasing capacity and are expected to offer further deals to attract consumers.

Profitability fell over the five years through 2012-13, starting with skyrocketing fuel prices leading up to 2008. A decline in demand for air travel and price wars followed in the subsequent years. As the industry took major blows in a highly unstable global environment, the average industry operator recorded either large drops in profit or extensive losses for the three years from 2007-08 to 2010-11. As the effects of the global downturn hit airlines, revenue fell by 11.8% in 2009-10. During the bitter year, airlines offered significant price cuts to curb the decline in passenger numbers. Airlines entered price wars, with many pricing airfares below the break-even margin.

The next five years will include a recovery period. Industry revenue is forecast to grow at a very marginal rate over the five years through 2017-18. Finch adds, “improving demand for air travel and rising prices will support revenue growth”. Demand for air travel will be strongest from emerging economies as they will recover faster than the domestic economy. However, price competition will limit revenue growth.

The Scheduled Passenger Air Transport industry has a high level of market share concentration, with the four largest players accounting for an estimated 90% of industry revenue. Industry concentration increased over the past five years following worldwide trends of airlines consolidating. Larger airlines expanded their operations via acquisitions and organically through increasing routes and capacity. Major companies include International Airlines Group, EasyJet and Virgin Atlantic.

For more information on the Scheduled Passenger Air Transport industry, including latest industry trends, statistics, analysis and market share information, purchase the full report from IBISWorld, the nation’s largest publisher of industry research.

IBISWorld industry Report Key Topics

Companies in this industry provide air transport for passengers on scheduled routes only. This includes domestic and international flights.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalisation & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld
Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on many UK industries. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in London, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.co.uk or call (020) 3008 6568.

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Gavin Smith
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