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Southeast Asian Safety Trends: The Rise of Low-Cost Carriers

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Abstract

Due to the rapid expansion of the middle class throughout Southeast Asia, the aviation industry has experienced world-leading growth which is forecast to continue. The scale of passenger growth has presented varying safety trends. This report will focus on three major developments including, The Rise of Low-Cost Carriers and Pilot Shortages

Southeast Asian Safety Trends

Aviation and air travel have proven itself as fundamental economic and social resources in modern times. As the global population increases and becomes ever more interconnected, the requirement for air travel will only escalate. By 2034, air travel is expected to reach 7.3 billion passengers annually. This is an increase of 4.3 billion passengers carried in the financial year 2018(IATA, 2017). The axis for global aviation is moving east. By 2030, the Asia-Pacific region will have exceeded both North America and Europe in terms of passenger quantities. And by 2034, one in every five air travelers will be traveling to, from, or within China(IATA,2016), expecting to generate a large impact on Southeast Asia. Although there is an expectation of a thriving Asian tourism market, there is the inevitability for impacts on safety trends. This report will document two of the major issues relating to safety in the region and how these are related to the growth in the industry. These issues include the rise of low-cost carriers and pilot shortages and the safety concerns that stem from these subjects.

The Rise of Low-Cost Carriers

Low-cost carriers have been heralded as a major innovation to the way the population travels both domestically and internationally and has proven to be an innovative aviation business plan. Offering significantly lower prices in comparison to legacy airlines, low-cost carriers omit the typical extras in favor of optional á la carte options. The rise in low-cost carriers in the age of social media has led to the common belief of these carriers cutting costs when it comes to things such as quality of aircraft, maintenance, aircrew training, airports, and compliance. While passengers mostly concerned with the price of an airline ticket are willing to compromise on things such as food and in-flight entertainment, an extremely small minority would be willing to compromise safety in any aspect.

The investigation into the crash of Lion Air flight 610 highlighted the growth of the low-cost carriers in the region as well as the organization needed to support operations (Johnsson, Levin, & Rusmana, 2018). The inquiry into the crash of the Lion Air flight criticized the low-cost carrier’s safety standards and maintenance routines. This led to the belief that some factors of the commercial operations cost-cutting would leave low-cost carrier operations vulnerable. While not directly blamed, the accident is mainly put down to poor maintenance actions as the flight before the crash reported an issue which was not fixed properly. It is arguable that as aircraft maintenance is prescribed by the manufacturer, an airline should have a minimal effect of quality of maintenance so long as regulations are followed however it is inevitable that human factors, as well as poor compliance, are bound to contribute to lapses in safety. Low-cost carriers place tight restrictions on turnaround times to maximize aircraft usage. In the case of the Lion Air accident, it is feasible that the maintenance engineer was rushed in completing the required maintenance leading to the cause of the accident.

Furthermore, due to the relative age of a low-cost carrier, it is feasible that the age of aircraft would be less than that of legacy airlines. Practically this is not a true indicator as low-cost carriers regularly purchase second-hand aircraft as well as inheriting aircraft from legacy carriers for those that have one as a parent company. Excluding recent incidents with the 737 maxes, it is reasonable to conclude that older aircraft provide a greater risk to safety. In the current aviation climate of high fuel prices, most airlines are favoring upgrading older aircraft for new models as they offer significantly better fuel economy. Largely this is having the overall effect of lowing average fleet ages. For example, despite being one of the oldest low-cost carriers in Asia, Cebu Pacific has an average fleet age of a little more than five years contrary to the Asian average of 9.7 years.

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Pilot Shortage.

As the aviation industry continues to experience growth and the number of low-cost carriers rises, many airlines are struggling to retain experienced pilots and train new pilots in line with the growth figures. This is especially the case in Asia as Boeing forecasts 790,000 new pilots will be needed over the next 20 years, of which Asia will require 260,000 new pilots. Boeing goes on to estimate that of the 260,000 pilots, China will need 128,500 pilots, Southeast Asia will need 48,500 and South Asia will need 42,500. See Figure 1

The shortages of pilots have Airlines and flight schools pushing to train as quickly as possible, with the implication that less experienced pilots are at the controls of larger aircraft quicker than ever before leading to a growing concern in safety standards. Due to the speed of the growth of pilot demands airlines may hire people whom they would normally reject (Matsumoto, 2019).

The pressure is already presenting itself. Asia’s biggest budget, IndiGo, was forced to scrap dozens of flights every day through the month of March 2018 after many of its pilots exhausted their annual limit on flying hours. Taiwan’s China Airlines averted a crisis in February this year by deciding to improve working conditions at an annual cost of almost $4 million after the pilot’s union went on a seven-day strike sighting amongst its complaints fatigue. ‘Complex training of pilots requires time, so the rate of supply growth doesn’t meet market demand,’ said Dang Tat Thang, CEO of Vietnam’s Bamboo Airway (Park, 2019). In response, many airlines have opted to set up training academies to increase the overall number of training output as well as having some control of the quality of training being undertaken.

AirAsia Group, IndiGo, Indonesia’s Lion Air as well as Australia’s Qantas and Virgin have all opened academies recently. The Centre for Aviation (CAPA) Harbison says Southeast Asia and India are likely to face the brunt of the shortfall, with the most impact felt by four carriers — AirAsia, IndiGo, Lion Air and VietJet (Park, 2019). See Figure 3. Certain airlines are also soundlessly cutting the minimum hours required for pilots to be qualified as captains as they struggle to fill positions quite quickly (Park, 2019).

Conclusion.

Aviation is an industry in which not only its professionals but the general public are safety conscious and being a contemporary environment, the potential issues are always evolving. The increase of low-cost carriers, as well as general industry growth, presents a safety issue which affects perceived confidence in the industry. Many airlines have seen both operational and safety issues stemming from the shortage of pilots and the nature of cost-cutting in low-cost carriers. Asia generally has been a focal point for most of the issues in the industry as it slowly becomes the largest market globally.

References

  1. Iata. (2017, October 24). 2036 Forecast Reveals Air Passengers Will Nearly Double to 7.8 Billion. Retrieved August 15, 2019, from https://www.iata.org/pressroom/pr/Pages/2017-10-24-01.aspx
  2. Iata. (2016, October 18). IATA Forecasts Passenger Demand to Double Over 20 Years. Retrieved from https://www.iata.org/pressroom/pr/Pages/2016-10-18-02.aspx
  3. Johnsson, J., Levin, A., & Rusmana, Y. (2018, October 30). The Mystery of the New Boeing Jet That Plunged Into the Sea, Killing 189. Retrieved from https://www.bloomberg.com/news/articles/2018-10-29/boeing-s-first-737-max-crash-leaves-mystery-with-plunge-into-sea
  4. Boeing Forecasts Nearly 1.5 Million Pilots and Technicians Needed by 2035. (2016, July 25). Retrieved from https://boeing.mediaroom.com/2016-07-25-Boeing-Forecasts-Nearly-1-5-Million-Pilots-and-Technicians-Needed-by-2035
  5. Matsumoto, F. (2019, June 01). Pilot shortage hits Asian airlines as passenger traffic surges. Retrieved from https://asia.nikkei.com/Business/Business-trends/Pilot-shortage-hits-Asian-airlines-as-passenger-traffic-surges
  6. Park, K. (2019, February 27). Asia’s Travel Boom Is in Trouble as a Pilot Shortage Worsens. Retrieved from https://www.bloomberg.com/news/articles/2019-02-26/asia-s-travel-boom-in-trouble-as-pilot-shortage-worsens

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Southeast Asian Safety Trends: The Rise of Low-Cost Carriers. (2022, March 17). Edubirdie. Retrieved January 30, 2023, from https://edubirdie.com/examples/southeast-asian-safety-trends-the-rise-of-low-cost-carriers/
“Southeast Asian Safety Trends: The Rise of Low-Cost Carriers.” Edubirdie, 17 Mar. 2022, edubirdie.com/examples/southeast-asian-safety-trends-the-rise-of-low-cost-carriers/
Southeast Asian Safety Trends: The Rise of Low-Cost Carriers. [online]. Available at: <https://edubirdie.com/examples/southeast-asian-safety-trends-the-rise-of-low-cost-carriers/> [Accessed 30 Jan. 2023].
Southeast Asian Safety Trends: The Rise of Low-Cost Carriers [Internet]. Edubirdie. 2022 Mar 17 [cited 2023 Jan 30]. Available from: https://edubirdie.com/examples/southeast-asian-safety-trends-the-rise-of-low-cost-carriers/
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