Asia Pacific demand growth has cooled after post-pandemic surge

Asia Pacific Demand Growth Has Cooled After Post-Pandemic Surge

Asia-Pacific airlines have recovered to pre-pandemic international traffic levels, but growth has recently stalled due to ongoing supply chain challenges. Profits, while still present, are increasingly under pressure despite strong passenger demand.

Industry Recovery and Capacity Trends

During the CAPA Airline Leader Summit - Asia held in Singapore on 30 October 2025, it was highlighted that although the region's airline industry has regained pre-pandemic international capacity, further expansion has been difficult to achieve.

At the previous year's summit in Hong Kong (November 2024), it was noted that Asia Pacific capacity growth had plateaued. This year, the flattening of growth has become even more pronounced.

Factors Affecting Growth

These issues have constrained capacity plans, limiting the industry's ability to expand beyond recovered levels. Nevertheless, airlines remain optimistic about future growth.

Fleet Investment and Profitability

In 2025 alone, Asia Pacific airlines placed 224 firm aircraft orders, signaling confidence in long-term expansion despite current operational difficulties. The sector remains generally profitable, supporting ongoing fleet investments.

"However, profits are coming under more pressure, and it is likely that we are past the peak of the latest profit cycle."

Regional Market Focus

The report also delves into specific markets within the Asia Pacific region, including Thailand, Mainland China, and Japan, analyzing how these areas contribute to the broader trends.

This detailed CAPA Analysis Report contains 1,411 words.

Author’s Summary

Despite reaching pre-pandemic traffic levels, Asia Pacific airlines face growth challenges from supply chain issues and profit pressures, yet they maintain strong fleet investments and future optimism.

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CAPA - Centre for Aviation CAPA - Centre for Aviation — 2025-11-03

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