the impact of mers on south korean airports · the impact of mers on south korean airports ©...
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© Counter Intelligence Retail Ltd www.counterintelligenceretail.com
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TABLE OF CONTENTS
INTRODUCTION p. 3
1 PASSENGER TRENDS p. 4
1.1 TOTAL AIRPORT PASSENGER NUMBERS p. 4
1.2 INTERNATIONAL ARRIVALS BY DESTINATION p. 5
1.3 INTERNATIONAL ARRIVALS BY ROUTE p. 6
1.4 INTERNATIONAL ARRIVALS FROM CHINA p. 7
1.5 SEAT CAPACITIES – FLIGHTS SCHEDULES FOR THE NEXT 6 MONTHS p. 8
1.6 10 YEAR FORECAST p. 9
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INTRODUCTION
The MERS virus outbreak in Asia, and in
particular the effect this has had on
Chinese passenger travel to South Korea
has received wide coverage by the
international and TR trade press recently.
CiR, using the data resources at our
disposal have taken an In-depth look at
exactly how big the impact of MERS has
been in South Korea and what the
outlook is for passenger travel to the
country.
We hope that you find the enclosed informative and useful, and it helps
position the alarming changes that are being reported into a more rounded
contextual view.
© Counter Intelligence Retail Ltd www.counterintelligenceretail.com
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Total passenger figures from
South Korean airports for July
2014-June 2015 are showing
healthy growth at 13% versus
the previous twelve months
with all airports bar Seoul
Gimpo seeing double digit
growth in the last twelve
months.
When we look at these figures
by month, up to and including
May, average passenger
growth had been 15% with
May 2015 seeing the highest
growth at 26% versus the
previous year despite the MERS
virus warnings beginning to
grow louder.
It is not until June we see the
MERS issue have an effect on
passenger numbers, falling by
almost 9% to 7.9m from 8.7m in
June 2014.
1.1 Total Airport Passenger Numbers
Source: CAPA
1. PASSENGER TRENDS
Total PAX By Airport (July 14-June 15 & Growth v July 13-June 14)
Total PAX By Month (July 2014-June 2015 v July 2013-June 2014)
Total PAX By Airport (June 2015 v June 2014)
The charts below look at total passenger numbers by airport showing the
passenger growth for South Korean airports which has grown by a healthy 13% in
the past twelve months. It is not until June 2015 that we see a significant fall in
total passenger numbers throughout South Korea of almost 9%.
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Overall passenger arrivals from
Asia have fallen by 26% with
arrivals from China seeing the
largest decline at -42%.
Passengers from Oceania and
CIS (Ex Soviet Union states)
have seen sharp increases in
arrivals into South Korea (93%
and 114% respectively). Whilst
important, the number of
passengers from these regions
is minimal versus other Asian
locations.
Each of the main South
Korean airports are seeing the
largest fall in passenger arrivals
from different areas of Asia,
highlighting the importance of
available routes from each
airport and how this can
effect overall passenger
numbers. For example, Seoul
Gimpo has seen a 49% drop in
arrivals from South East Asia
whilst at Jeju this is only a 29%
drop, yet arrivals from China
are down by 62% at Jeju and
only 28% at Seoul Gimpo.
Source: KAC
1.2 International Arrivals By Destination
International Arrivals To All KAC Korean Airports (June 2015 v June 2014)
International Arrivals By Korean Airport (June 2015 v June 2014)
Jeju Seoul Gimpo
Busan Gimhae Daegu
Having seen that South Korean airports saw a decline in passenger
numbers in June 2015, these charts look at where this decline has
come from. As we see, passengers from China are having the
largest effect, with arrival numbers down by 42% versus June 2014
with Jeju experiencing the largest decline of 62% in passenger
numbers from China.
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Passenger arrivals from all the
main Greater Chinese airports
into South Korea saw a decline in
June 2015 v June 2014. Mainland
Chinese and Hong Kong airports
saw the heaviest fall in departure
numbers to South Korea with an
average 39% fall.
Arrivals from Taipei into South
Korea are seeing differing results
dependent on destination airport.
Whilst departures are down by
only 8% overall, passengers flying
to Jeju are down by 86% whilst at
Busan Gimhae they have grown
by 18% to almost 11,000.
Whilst the picture at most airports
is of decline in arrivals from China,
Daegu airport counters this trend,
seeing a 20% growth in
passengers from China, due to
the number of flights via China
Eastern and Air China having
increased versus 2014.
Source: KAC
1.3 Int’l Arrivals By Route
International Arrivals From Greater China To All KAC Korean Airports (June 2015 v June 2014)
International Arrivals From Greater China To Selected Korean Airports (June 2015 v June 2014)
Jeju Seoul Gimpo
Busan Gimhae Daegu
Having seen that passenger numbers from China have seen the
largest decline to South Korea, these charts highlight the Greater
Chinese airports to see if there is a particular region or airport that is
causing this decline. The large Chinese international airports all
show a similar size of decline with the exception of Taipei which has
been comparatively unaffected seeing only an 8% decline.
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Although the MERS virus first
came to prominence in late
April, the decline in passenger
arrivals from China to South
Korea wasn’t felt by Korean
airports until June where there
was a sudden 42% fall in
arriving passengers. Prior to
this, passenger arrivals to South
Korea from China had grown
by an average of 27% each
month versus the previous
twelve months.
This fall was felt particularly at
Jeju airport which recorded a
62% fall in arrivals whilst Seoul
Gimpo and Busan Gimhae
airports recorded
comparatively more
moderate falls of 28% and 19%
respectively.
Source: KAC
1.4 Passenger Arrivals From China
International Arrivals From China To Korean Airports (July 2014-June 2015 v July 2013-June 2014)
International Arrivals From China To Selected Korean Airport (July 2014-June 2015 v July 2013-June 2014)
Jeju Seoul Gimpo
Busan Gimhae
The charts below show the dramatic decrease of passengers from
China travelling to South Korea in June 2015 to a level well below
the figure in June 2014 - with Jeju seeing the biggest decline in June
2015. However, this drop off has to be considered in the context of
the prolific pattern of growth of passengers travelling from China to
S Korea in the last year, making the drop off appear even more
dramatic.
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Looking at the number of
scheduled flights in the next 4
months, it appears that the
airlines expect the current
downturn in passengers from
China to South Korea to continue
until July 2015.
However, the current situation is
not anticipated to have a lasting
effect on travel to South Korea
with airlines scheduling more
flights from August onwards,
matching 2014’s figures, with
growth expected to return from
September onwards.
The airlines seem to have taken
a more cautious approach
to the smaller seasonal airports,
where the recovery is less
pronounced.
Source: Flight Global
1.5 Seat Capacities 6 Month Outlook
Scheduled Seat Capacity From China To South Korea (Mar-Nov 2015 v Mar-Nov 2014)
Scheduled Seat Capacity From China To Selected Korean Airports (Mar-Nov 2015 v Mar-Nov 2014)
Prior to July, Airline seat capacities to South Korea from China had
been, on average, 30% higher in 2015 than in 2014. The outbreak of
MERS in Asia has seen the available number of seats in July fall by
24% versus 2014 to just over 700,000 from 930,000 in 2014.
Jeju Seoul Gimpo
Busan Gimhae
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The ten year forecast for
passenger numbers to South
Korea from Greater China is
extremely positive with total
passenger numbers expected to
reach 33.3m by 2024, a growth of
78% versus 2014.
Passengers from Mainland China
are expected to see the highest
growth to South Korea of 86% to
25.7m versus the 2014 number of
13.8m. This growth is expected to
come from a growing travelling
Chinese Middle Class and a
growing number of regional
Chinese airports operating
International flights. In the past
twelve months (May 14-Apr 15)
airports such as Tianjin and
Shenzhen have seen growths of
24% and 72% in passengers
travelling to South Korea with
growth expected to continue in
the long term.
Source: Oxford Economics
Forecast Passenger Numbers To South Korea From China (2014-2024)
Indexed Forecast Passenger Growth To South Korea From China (2014-2024)
1.6 10 Year Forecast
Looking ahead, using the Oxford Economics air passenger forecasts,
that are driven largely by socio-economic factors; traffic from Greater
China to South Korea is forecast to grow by 78% by 2024 to over 33
million passengers.
Although the MERS virus has had an immediate and dramatic impact
on passenger travel in the short term, it is unlikely that such a
phenomena will have a significant effect on the longer term socio-
economic drivers that have been the cause of the recent growth and
will fuel the predicted growth in the future.
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