INTERNATIONAL FLIGHT CONNECTIONS Deon Cloete 16 April 2010
The Impact of the Economic Crises on Airlines - Global
Passenger Traffic Collapses mid-2008 Source: IATA Premium Traffic Monitor Dec. 2009 Source: Rigas Douganis March 2010
IATA Airlines Traffic Year  2009  v. Year  2008 Excludes LCCs and non-IATA airlines Source: Rigas Douganis March 2010 Mark...
Fares falling faster than traffic for IATA airlines Source: IATA Source: Rigas Douganis March 2010
Prospects for African Aviation are Optimistic Annual Growth Rates 2009-2028 (Pass-Kms) Source: Airbus : Global Market Fore...
The Impact of the Economic Crises on Airlines – South Africa & Cape Town
ACTUAL PASSENGER NUMBERS AND GROWTH 2000 - 2010
INTERNATIONAL ARRIVING PASSENGERS BY MONTH
POINT OF SALE - Top 16 Foreign Country Markets Source: ASM MIDT 2010
PAX FARE MIX - PREMIUM & ECONOMY  2 WAY PAX (000) Source: ASM MIDT 2010
PAX FARE MIX - PREMIUM & ECONOMY  2 WAY PAX (000) Source: ASM MIDT 2010
International Flight Connections
CTIA DIRECT FLIGHTS – INTERNATIONAL  Withdrew
CTIA INDIRECT FLIGHTS – INTERNATIONAL CTIA DIRECT FLIGHTS - REGIONAL
CAPACITY UTILISATION – Bilateral Air Services Agreements  Source: DOT 2006
<ul><li>High summer season from Oct to March – high frequencies and passenger numbers </li></ul><ul><li>Low winter season ...
INTERNATIONAL ARRIVING PASSENGERS BY MONTH
<ul><li>Cape Town is long haul destination and therefore airfares relatively expensive  </li></ul><ul><li>Leisure Travelle...
Transport, on average, represents one third of the cost of a trip to South Africa Source : SA Tourism Survey 2004
PAX FARE MIX - PREMIUM & ECONOMY  2 WAY PAX (000) Source: ASM MIDT 2010
Distribution of Foreign Visitors
What can be done?
<ul><li>Recognise seasonality as a major problem hampering tourism economic growth of the Western Cape </li></ul><ul><li>P...
<ul><li>Recognise seasonality as a major problem hampering the tourism and economic growth of the Western Cape </li></ul><...
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Flight connections to Cape Town by Deon Cloete, ACSA

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Flight connections to Cape Town by Deon Cloete, ACSA

  1. 1. INTERNATIONAL FLIGHT CONNECTIONS Deon Cloete 16 April 2010
  2. 2. The Impact of the Economic Crises on Airlines - Global
  3. 3. Passenger Traffic Collapses mid-2008 Source: IATA Premium Traffic Monitor Dec. 2009 Source: Rigas Douganis March 2010
  4. 4. IATA Airlines Traffic Year 2009 v. Year 2008 Excludes LCCs and non-IATA airlines Source: Rigas Douganis March 2010 Markets Passenger Kms % Freight Kms % Africa - 6.8 - 11.2 Asia Pacific - 5.6 - 9.2 Europe - 5.0 - 16.1 Latin America + 0.3 - 4.0 Middle East + 11.2 + 3.9 North America - 5.6 - 10.6 TOTAL IATA Members - 3.5 - 10.1
  5. 5. Fares falling faster than traffic for IATA airlines Source: IATA Source: Rigas Douganis March 2010
  6. 6. Prospects for African Aviation are Optimistic Annual Growth Rates 2009-2028 (Pass-Kms) Source: Airbus : Global Market Forecast 2009-2028 Source: Rigas Douganis March 2010 Markets Sub-Saharan Africa to/from Annual % Growth Rate PR China 9.3 North Africa 9.0 Middle East 7.5 South Africa 7.4 Indian sub-Continent 7.1 Australia - NZ 5.9 Asia 5.0 USA 4.8 World Average 4.8 South America 4.3 Western Europe 4.2
  7. 7. The Impact of the Economic Crises on Airlines – South Africa & Cape Town
  8. 8. ACTUAL PASSENGER NUMBERS AND GROWTH 2000 - 2010
  9. 9. INTERNATIONAL ARRIVING PASSENGERS BY MONTH
  10. 10. POINT OF SALE - Top 16 Foreign Country Markets Source: ASM MIDT 2010
  11. 11. PAX FARE MIX - PREMIUM & ECONOMY 2 WAY PAX (000) Source: ASM MIDT 2010
  12. 12. PAX FARE MIX - PREMIUM & ECONOMY 2 WAY PAX (000) Source: ASM MIDT 2010
  13. 13. International Flight Connections
  14. 14. CTIA DIRECT FLIGHTS – INTERNATIONAL Withdrew
  15. 15. CTIA INDIRECT FLIGHTS – INTERNATIONAL CTIA DIRECT FLIGHTS - REGIONAL
  16. 16. CAPACITY UTILISATION – Bilateral Air Services Agreements Source: DOT 2006
  17. 17. <ul><li>High summer season from Oct to March – high frequencies and passenger numbers </li></ul><ul><li>Low winter season from April to Sept – low frequencies and passenger numbers </li></ul><ul><li>It takes up to 3 years to grow a viable route and seasonality makes it extremely difficult. </li></ul><ul><li>Some airlines only fly in summer eg.: Virgin/Air Berlin/Lufthansa </li></ul><ul><li>Airlines cannot optimise frequencies, 7 a week most preferred for economies of scale and lower cost per flight </li></ul><ul><li>Airlines can’t set up station office, station manager and own staff, has to appoint agents and may compromise their brand. </li></ul>Seasonal Destination Challenges
  18. 18. INTERNATIONAL ARRIVING PASSENGERS BY MONTH
  19. 19. <ul><li>Cape Town is long haul destination and therefore airfares relatively expensive </li></ul><ul><li>Leisure Travellers fly once/twice a year and primarily in summer. </li></ul><ul><li>Business Travellers more than once per year and all year round. </li></ul><ul><li>Airlines makes 80% of their revenue from 20% of the seats up front: Business/First Class </li></ul><ul><li>Economy class seats (80%) yields on 20% of revenue </li></ul><ul><li>Cant utilise cargo to cross subsidise flight cost as high value low bulk cargo not existent in Cape Town. </li></ul><ul><li>Agricultural and fish exports are shipped as it is too bulky and also only in summer. </li></ul><ul><li>South Africa’s business hub is Gauteng, hence most international flights into OR Tambo. </li></ul>Leisure Destination Challenges
  20. 20. Transport, on average, represents one third of the cost of a trip to South Africa Source : SA Tourism Survey 2004
  21. 21. PAX FARE MIX - PREMIUM & ECONOMY 2 WAY PAX (000) Source: ASM MIDT 2010
  22. 22. Distribution of Foreign Visitors
  23. 23. What can be done?
  24. 24. <ul><li>Recognise seasonality as a major problem hampering tourism economic growth of the Western Cape </li></ul><ul><li>Promote and Position Cape Town and Western Cape as the “Creative Hub of Africa” to encourage business development opportunities and investment or as “Open for Green Business Developments”. </li></ul><ul><li>Promote and Position Cape Town and Western Cape as the an “All Year Round and a Responsible Destination” </li></ul><ul><li>Reduce investment in “summer” industries (agriculture/fishing) and Events like J&B Met, Argus Cycle Tour etc. </li></ul><ul><li>Increase investment and promote “Winter” Events and all year round industries. </li></ul><ul><li>Promote and invest in Business Tourism, i.e. conventions and conferences to develop an all year round destination. </li></ul><ul><li>Identify and encourage investment to manufacture of goods of high value /low bulk to increase airfreight </li></ul><ul><li>Devise and Airline incentive scheme to encourage international flight connections. </li></ul>SOME SUGGESTIONS….
  25. 25. <ul><li>Recognise seasonality as a major problem hampering the tourism and economic growth of the Western Cape </li></ul><ul><li>Promote and Position Cape Town and Western Cape as the an “All Year Round and a Responsible Destination” </li></ul><ul><li>Reduce investment in “summer” Industries and Events like J&B Met, Argus Cycle Tour etc. </li></ul><ul><li>Increase investment and promote “Winter” Events and all year round industries. </li></ul><ul><li>Promote and invest in Business Tourism, i.e. conventions and conferences to develop an all year round destination. </li></ul><ul><li>Identify and invest in the manufacturing of goods of high value /low bulk to increase airfreight. </li></ul><ul><li>Devise and Airline incentive scheme to encourage international flight connections. </li></ul>Organised Business, ACSA and Tourism Agencies

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