The Middle East region is showing some of the fastest recoveries in first and business-class air travel on the back of a rise in global trade, recent figures show. The number of premium tickets sold by local carriers grew by 25 per cent in January on flights to Australasia and the Far East compared with a year ago, the International Air Transport Association (IATA) said. Services to all other regions saw gains, including internal Middle East flights and those to Europe and Africa.
Globally, premium travel rose by 5.7 per cent in January after zero growth a month earlier, which put an end to 10 months of falling volumes. Premium seats are vital revenue generators for airlines, accounting for about 10 per cent of available seats but 30 per cent of an airline's turnover. The latest statistics could help ease fears of a double-dip recession in the global economy after growth slowed this year as governments wound down various stimulus packages, IATA said.
"It now looks as though the recession in premium travel has been cyclical rather than a permanent fall," it said in a report yesterday. "Economy travel is also likely to be benefiting from the return of business travel." The report will be welcome news for airlines, which are expected to lose US$2.8 billion (Dh10.28bn) this year worldwide, including $400 million in the Middle East, as low demand makes it difficult for carriers to raise ticket prices to profitable levels.
The report, using data from more than 200 airlines worldwide that are members of the IATA travel body, said consumer sentiment was increasingly positive in the emerging markets. But it noted: "Faltering consumer confidence in the US and Europe, as unemployment and debt constrain spending, may be restricting the recovery in leisure travel." Regional aviation growth was attributed to gains in market share by long-haul airlines, which are developing their Middle East bases as hubs for transit flights between Asia, Europe and the Indian subcontinent, and in the process challenging airlines based in both hemispheres.
"Middle East markets continue to benefit from long-haul market share gains by local airlines," the IATA said. This trend could continue after UAE carriers Etihad Airways and Emirates Airline were granted more flights to Australia, boosting their interest in the lucrative "Kangaroo Route" connecting the country with the UK. Officials from the UAE's General Civil Aviation Authority said 14 additional weekly flights had been awarded to the two long-haul carriers, which will be split equally, starting in March next year.