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| 10 August, 2018

Rising international passengers to lift UAE's aviation sector

Flight destinations most searched focus mainly on European, Far East

Image used for illustrative purpose.
People walking in a spacious lobby at Dubai airport.

Image used for illustrative purpose. People walking in a spacious lobby at Dubai airport.

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The UAE's aviation sector is all set to witness massive growth as the region welcomes an increase in international passengers.

SEMrush online search data for GCC outbound travel from the UAE, Saudi Arabia and Kuwait has indicated rising travel searches on their platform.

Adam Zeidan, corporate communications manager for SEMrush in the GCC and Turkey, said: "Our online search data for GCC outbound travel from the UAE, Saudi Arabia, and Kuwait is showing a pattern of high search volume by GCC residents for flights and trips abroad during the summer that peaks in June and July each year."

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"The international flight destinations that are most searched focused mainly on European and Far East destinations such as Paris, Istanbul, Goa, Singapore, Hong Kong, Bangkok and Phuket. Also based on the last three years online search trends, the airlines can expect another peak around January each year."

Middle Eastern carriers posted an 11 per cent demand increase in June compared to the same month last year, according to latest International Air Transport Association (Iata) reports. This was a sharp turnaround from the flat traffic growth in May, which was partly attributable to the timing of the holy month of Ramadan between the two years.

Results were also affected by unfavourable developments in the year-ago period, including the ban on large portable electronic devices, as well as the travel restrictions imposed by the US for visitors from certain Middle East and African countries. Capacity rose 8 per cent and load factor climbed 1.9 percentage points to 71 per cent.

Dubai in the first half of 2018 welcomed 8.1 million visitors and is on track to surpass its last year's figures of 15.79 million, according Dubai's Department of Tourism and Commerce Marketing. The emirate is expected to become the third most-visited city in the world by surpassing Paris this year. It was the fourth most-visited city last year after Bangkok, London and Paris.

"The flight search peak happens in January and June each year in the UAE, which has become both a global destination in itself, and a global international flight connection hub. The regional GCC airlines all have two key factors in their favour to meet these peaks - firstly large modern aircraft fleets, and secondly a wide coverage of destinations on almost every continent," added Zeidan.

"If they can also offer competitive ticket pricing their product is surely the most attractive. However, the airlines of the region also need to ensure they don't miss a beat when it comes to their marketing teams using the latest global digital and SEO marketing tools with a competitive analysis capability, as this will give them the most valuable insights into competitor online marketing efforts in the fastest and most cost-effective manner."

The Iata announced global passenger traffic results for June showing that demand - measured in total revenue passenger kilometres - rose by 7.8 per cent compared to June 2017. This was up from 6 per cent year-over-year growth recorded in both May and April. June capacity - available seat kilometres - increased by 6.5 per cent, and load factor rose 1 percentage point to 82.8 per cent.

"The first half of 2018 concluded with another month of above-trend demand growth, which is a good indicator for the peak summer travel season in the northern hemisphere. But the looming prospect of a global trade war is casting a long shadow. Additionally, rising cost inputs - fuel prices have soared by approximately 60 per cent over the past year - are reducing the stimulus of lower fares," Iata director-general and CEO Alexandre de Juniac said.

The first six months of 2018 produced demand growth of 7 per cent, a strong performance, but down from 8.3 per cent growth recorded in the first half of 2017, according to the Iata.

Prateek Sharma, aviation strategy and operations consultant at KPMG, said: "Middle East Airlines have always been global connectors. Major airlines are expected to see upward trend and strong growth in international passenger traffic this year. Emerging Asian economies will boost the revenues and demand for the region's carriers. Major airlines in the region are expected to face challenges from low oil revenues, regional conflicts, crowded air space, and competition from new super connector. Despite the challenges, there is positive momentum heading into 2018."

Marinos Menelaou, acting director-general of the Cyprus Tourism Organisation, said: "The UAE has definitely become a global tourism destination and earlier this year we welcomed the inaugural flight of Cobalt Air, a Cypriot airline that now flies direct from Abu Dhabi to Larnaca. This new flight complements the existing route from Emirates from Dubai and... will definitely benefit the tourist exchanges between the two countries."

"We believe that the regional airlines always respond positively to increased demand and... we have seen airlines serving the destination always being flexible to increase their flight frequencies to popular destinations during peak seasons."

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