Asia Pacific Demand Growth Cools After Post-Pandemic Surge
Asia-Pacific airlines have returned to pre-pandemic levels of international traffic, but growth has stalled due to ongoing supply chain challenges. Despite robust demand, profits are increasingly under pressure.
Industry Recovery Status
The Asia Pacific airline sector has restored international capacity to pre-pandemic benchmarks. However, further expansion has been limited. This key insight was highlighted during the CAPA Airline Leader Summit - Asia, held in Singapore on 30 October 2025.
A similar presentation at the 2024 event in Hong Kong noted that capacity growth in the region had plateaued, and this year the stagnation has become even more pronounced.
Factors Behind the Slowdown
- The natural tapering of growth as the industry reaches full recovery.
- Supply chain issues including delivery delays and engine shortages.
- Operational constraints that continue to limit capacity expansion plans.
Outlook and Market Confidence
Despite current hurdles, Asia Pacific airlines remain optimistic, placing 224 firm aircraft orders in 2025 alone. Airlines continue to show profitability, which supports ongoing fleet investments.
"However, profits are coming under more pressure, and it is likely that we are past the peak of the latest profit cycle."
Regional Market Insights
The analysis covers overall trends in the Asia Pacific but also examines specific markets such as Thailand, Mainland China, and Japan.
Report Details
This CAPA Analysis Report contains 1,411 words and provides an in-depth overview of the current industry state.
Author’s Summary
While Asia Pacific airlines have rebounded to pre-pandemic traffic levels with strong demand, supply chain and profit pressures are slowing further growth and challenging future expansion.