The outlook for airlines in Asia remains ‘broadly positive’ in spite of geopolitical challenges that have pushed up fuel prices and threaten to dent consumer confidence.
The Association of Asia Pacific Airlines (AAPA) says its airlines continue to expand their networks and service offerings, while maintaining strict cost controls in a ‘challenging’ operating environment.
“Airlines are facing a persistently high operating cost environment, exacerbated by a sharp increase in jet fuel prices. Increasing cost pressures may weigh on consumer spending and business sentiment in the coming months,” says AAPA director general Wong Hong.
The challenging operating environment of the past few months shows no sign of abating. The ongoing conflict in the Middle East, together with broader geopolitical tensions, is likely to contribute to continued volatility in oil and currency markets. Last week jet fuel prices were 41% higher than a year earlier.
. . . Solid footing
Asia Pacific airlines entered 2025 from a position of strength, with robust passenger and cargo demand supporting another year of profitable growth.
In 2025, the combined net profit was USD$12.1 billion, driven by firm passenger and cargo demand, while lower fuel prices helped offset cost pressures arising from ongoing supply chain disruptions. Amid positive global economic conditions last year, the region recorded a 7.7% increase in systemwide passenger demand.
AAPA’s 18 members include Air New Zealand and Qantas.
