Corporate  |  APRIL 26, 2013 6:48AM

Air travel map being redrawn as global economy evolves

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thumb airplaneThe global air travel map is being redrawn as growth rates slow in traditional markets and surge in evolving economies including India, Africa and Latin America, says Etihad Airways.

Its President and Chief Executive Officer James Hogan said the major shift occurring in the global economy is impacting significantly upon the air transport industry, requiring airlines to reshape their networks and enter new partnerships in order to remain competitive.

“Legacy markets are growing, but at a slower pace. Emerging markets are surging,” he said in a statement.

He said traffic patterns and demographics are changing while traditional air transport hubs are declining in prominence, with growth constrained by inadequate infrastructure and ingrained political resistance to change.

Hogan said International Air Transport Association (IATA) figures show that in February 2013, Middle East hub traffic was up by 10.6 percent over February 2012, compared with the global growth rate of 3.7 percent.

The airline industry is entering a new phase of consolidation, as no singlecarrier can satisfy the global growth in passenger traffic, he said.

etihad jet thumb“A new hybrid business model is emerging, in which minority equity alliances are bridging the gap between full mergers and legacy alliances,” said Hogan.

In addition to its new investment in Jet Airways, Etihad Airways has acquired stakes in airberlin, Air Seychelles, Virgin Australia and Aer Lingus, and continues to explore opportunities where they make financial and strategic sense.

“The new business model delivers benefits which previously were available only through full mergers or acquisitions,” he added.


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