US propensity for air travel is 15 times greater than in China; Cyprus tops European rankings

Image: Suriname Airways
If you need to develop a true middle market product, then Suriname is your ideal type. In terms of propensity to travel, the country is as close to the world average as it gets (according to research done by Airbus).

Inspired by an enquiry anna.aero recently received from a household name airline regarding propensity to travel data for Europe, our lead story this week takes a look at air travel activity across various country markets. While total passenger numbers at a country’s airports is obviously one measure, what happens if population data for that country is also taken into account? Calculating the number of airport passengers per head of population for some of the world’s largest (non-European) countries reveals that Australia tops the table with over five airport passengers per head of population.

Chart: Major non-European countries - Airport passengers per head of population 2008
Source: Various (airport data), Wikipedia (population data)

The US, with a population of over 300 million people and over 1.4 billion passengers passing through its airports, ranks second with over 4.5 airport passengers per head of population. China, with over 1.3 billion inhabitants, scores just 0.3 passengers per person (PPP) despite being the second biggest country for air travel with over 400 million passengers already using the nation’s airports. If China’s PPP were to increase to 1.5 (just one-third of the current US level) that would result in 2 billion passengers passing through China’s airports. No wonder Airbus and Boeing are currently delivering more new aircraft to that part of the world than anywhere else.

Islands score high in Europe

A similar analysis of 36 European countries reveals, not surprisingly, that islands tend to score very high on this measure, with four of the top 5 PPP scores achieved by countries surrounded by water. Although Norway is not an island, its geography and terrain make ground-based travel between many cities quite challenging resulting in a high PPP value.

Chart: European countries - Airport passengers per head of population 2008
Source: Various (airport data), Wikipedia (population data)

Although no account has been taken of economic factors (such as GDP) the ranking of many Central European states towards the bottom of the list comes as no great surprise. Europe’s big five countries for air travel (France, Germany, Italy, Spain and the UK) appear in two clusters. The UK scores high due to being an island, while Spain scores well as an appealing destination.

What this data does not show is the actual propensity to travel of residents within a country. This would require knowledge of the proportion of travellers at each airport whose complete journeys are originating in that country. Again, the high scores achieved by Cyprus and Malta are not just because of their island status but also because each is an attractive destination which generates many inbound passengers.

Airbus looks at relationship between propensity to travel and GDP

In its latest Global Market Forecast 2009-2028, Airbus has produced a chart showing the relationship between propensity to travel and GDP per head of population. This does take into account the issues of passengers originating in a particular country by using the IATA PaxIS tool which uses Bank Settlement Plan data as its main source of information. GDP data appears to have been provided by Global Insight. Note that the y-axis is exponential rather than linear.

Even taking into account GDP and the small local population, Cyprus and Malta still perform well above the trendline. By contrast Slovenia would appear to be well below the trendline suggesting a market that may well be underserved by airlines. Airbus has highlighted the BRIC countries (Brazil, Russia, India and China) which are all well towards the bottom end of the curve. The implication is that these potentially dynamic economies could easily improve their propensity to travel as their economies develop resulting in major increases in air travel demand in these countries.

Chart: Airbus Graph - Passenger orginating from a particular country
Click on the graph to make it larger

Comments

  1. One factor not mentioned is the size (area) of the country. It is not surprising that countries with large distances between the main coastal cities like USA, Canada and Australia have a lot of air traffic. If the areas were smaller many people would take the car or the train as in Europe.

  2. Andrew says:

    Since the data comes from PAXIS and IATA lost the right to use Amadeus GDS data in PAXIS (i.e. about 35% of World bookings), the information is largely useless.

    anna.aero replies: Provided Airbus collected the data after the Amadeus input was excluded from PaxIS earlier this year, you have a point. As Antoin points out below, there are also further weaknesses in the data that supposedly could have been compensated for by using PaxIS PLUS, which estimates the market as a whole.

  3. Antoin Daltun says:

    It is interesting that Ireland shows twice as many passengers per head as the Netherlands. The hub at AMS does not compensate for the ease of surface travel to neighbouring capitals and the relatively smaller low-fare airline sector. The comparison would probably be very different if based on RPK instead of passenger numbers.

    The Airbus comparison of propensity to travel v GDP is weakened because the BSP base excludes direct interline purchases and therefore most LCC traffic.

  4. Antoin Daltun says:

    I presume the top table counts passengers within Europe twice (as an arrival and a departure) while long-haul passengers are only counted once [?]

    anna.aero replies: Since total airport passengers have been grouped together by country, domestic passengers are counted twice – once at each airport. Similarly, should the country data be aggregated, for example in a Europe grouping, any passengers travelling between the European states in that grouping would be counted twice.

  5. Alex Melgar says:

    Propensity to travel would be better calculated if airport passengers were counted on an actual origin-destination basis, thus excluding passengers traveling in-transit. Such passengers may reflect a particular airline network configuration and not an actual intention to fly to or from a particular country. For example, UAE airport passengers are considerably affected by all the intransit passengers flying Emirates through Dubai, which is a factor that is not related to actual propensity to travel to and from the United Arab Emirates.

    anna.aero replies: Good point, Alex. We envy the people who have access to comprehensive O&D data.

  6. Steven Debipersad says:

    We from Suriname are glad with the picture of our airliner in this article, and also with the position given in the Airbus survey. We are also glad for getting a place higher than our neighbor Brazil.

  7. Andy Hofton says:

    Very interesting as I was having a heated debate about these sorts of charts last week before Anna.Aero hit the streets. As you wizz kids will know, many of these charts are based on the traffic defined by the state of registration of the carrier and not by passport holding of the passenger or the country of residence of the passenger, so Anna.Aero has done a good job shining a bit more light on the topic. We would probably be wise to use these charts as topics for discussion and then to use them quite carefully as the basis for a narrative rather than the basis of heavy mathematical analysis. I once worked on a study in which we gave cities and countries brownie points for their location, attractiveness, openness, level of fares, maturity etc to boost or hold back the forecast we had made based on GDP/capita. You might think that this was a bit Mickey Mouse, but the client was impressed (and paid up).
    Keep up the good work!

  8. It’s a quiet interesting topic, which explains the “Air Travel Propensity” very precisely and outlines the countries population outfit in air Travel. The data which has been taken up for this analysis is based on the seat avialbility or the actual travel performed by the paasenger’s.

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