NEW YORK, May 17, 2021 /PRNewswire/ -- The "Low-Cost Carrier Market by Type, Service, and Geography - Forecast and Analysis 2021-2025" report has been added to Technavio's offering.
The low-cost carrier market is poised to grow by USD 94.06 billion between 2021-2025, progressing at a CAGR of about 16% during the forecast period.
An increase in the number of air passengers can be observed due to the growing economic development in emerging countries such as India, China, and Indonesia, which is supporting the low-cost carrier market growth. The growth in the global tourism industry has increased the number of air passengers globally. For instance, the overall number of air passengers increased by 4%-5% in 2019 compared with that in 2018. Spain, China, Italy, the UK, Germany, and Thailand are among the countries that registered an increase in the number of tourists who arrived in 2018 and 2019. Factors such as the expanding middle-class population in emerging economies, the inclination of this population group for air travel, and the rise in the global working-age population are expected to increase total air passenger traffic. Moreover, customers of LCC get seasonal discounts and frequent flyer concessions, which increases the number of passengers flying with LCCs. These factors propel the market growth.
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COVID-19 is expected to have Positive and Superior impact on the market growth. However, even if the spread of virus is contained, we expect it to take more than two quarters (six months) to reach a normal state of economic activity. In the short term, the market demand will show At Par growth.
45% of the market's growth will originate from APAC during the forecast period. China and India are the key markets for low-cost carrier market in APAC. The low-cost carrier market growth in APAC can be attributed to a steady increase in passenger traffic.
Technavio suggests three forecast scenarios (optimistic, probable, and pessimistic) considering the impact of COVID-19. Technavio's in-depth research has direct and indirect COVID-19 impacted market research reports.
Know About the Key Opportunities and Growth of Low-Cost Carrier Market in Diversified Support Services Industry
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The low-cost carrier market is segmented by type (narrow body and wide body), service (passenger service and cargo service), and geography (APAC, North America, Europe, MEA, and South America).
The demand for narrow-body aircraft by LCCs is increasing rapidly due to the business, tourism, and growing middle-class population, and low operational costs offered by LCCs. Also, fluctuating fuel costs, strict regulations on noise and CO2 emissions, and increasing competition among LCCs are forcing LCCs to optimize their operational efficiency. One of the ways is to use fuel-efficient aircraft while providing attractive service, safety, and comfort to attract passengers. These factors are driving the adoption of narrow-body aircraft among LCCs, thus augmenting the growth of the market.
The low-cost carrier market is fragmented and the vendors are deploying organic and inorganic growth strategies to compete in the market.
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