TALK TO US ABOUT THE PACE OF RECOVERY.
WE TALK ABOUT HOW HOPE HINGES ON CHINA'S REOPENING.
HOW QUICKLY, WHAT DOES THAT MEAN FOR THE RECOVERY IN
AVIATION? SUBHAS: WE ALWAYS TALKED ABOUT CHINA
BEING THE ELEPHANT IN THE ROOM WHERE THE ELEPHANT THAT IS NOT
IN THE ROOM. NOW THAT CHINA HAS ENTERED THE
ROOM, IT IS A CASE OF THE AWAKENING OF THE SLEEPING GIANT.
WE CAN LOOK FORWARD TO THE PACE OF RECOVERY REALLY PICKING UP.
LAST YEAR, JAPAN, KOREA, SOME OF THE BIG MARKETS ONLY OPENED
UP IN OCTOBER AND IF YOU LOOK AT THE RECOVERY, THE PACE OF
RECOVERY WAS THREE TIMES MORE COMPARED TO 2021.
AT THE SECOND HALF WAS SIX OR SEVEN TIMES MORE.
WITH CHINA BEING THE LARGEST MARKET, 40% OF THE ASIA-PACIFIC
OVERALL TRAFFIC, IT WILL BE A REAL BOOSTER FOR THE RECOVERY
PROCESS. HASLINDA:
SOME HAVE SUGGESTED CHINA COULD HELP RECOVER TO PRE-PANDEMIC
LEVELS BY THE END OF 2023. IS THAT OPTIMISTIC? SUBHAS:
WE CAN BE OPTIMISTIC BUT I'M NOT SURE WE CAN HAVE RECOVERY
BY THE MIDDLE OF THIS YEAR. IF WE CAN GET TO 75% BY
SEPTEMBER AND THEN BE HELPFUL FOR A COMPLETE RECOVERY.
HASLINDA: JET FUEL PRICES ARE ABOUT 100%
HIGHER THAN A YEAR AGO. HOW WOULD THAT COUNT AS A
RECOVERY STORY? SUBHAS: THERE ARE QUITE A FEW HEADWINDS.
IF YOU LOOK AT THE AVIATION PICTURE, IT IS VERY PROMISING.
THE U.S. DOLLAR BEING HIGH AND THE COST
FOR AIRLINES DENOMINATED IN U.S. DOLLARS, THAT IS A CONCERN.
JET FUEL PRICES ARE 80% HIGHER THAN THE OVERALL PRICES OF
BRENT CRUDE.
THAT IS GOING TO BE A DAMPENER FOR AIRLINE RECOVERY, BUT ALSO
THINGS LIKE INFLATION AND RECESSION IN WESTERN COUNTRIES.
MANY ARE EXPECTING A DEEP RECESSION AND THAT WILL AFFECT
THE PROPENSITY FOR TRAVEL. ASIA-PACIFIC IN THE PAST HAVE
BEEN OVER -- HAVE BEEN ABLE TO OVERCOME THESE CHALLENGES AND
INBOUND TRAFFIC WILL BE VERY STRONG. HASLINDA:
DO YOU EXPECT TO SEE CONSOLIDATION OVER THE COURSE
OF THE THREE YEARS OF THE PANDEMIC?
WE SAW ABOUT 100 NEW AIRLINES COMING TO THE FLOOR DUE TO
CONSOLIDATION. NOW THAT NORMALIZATION IS
TAKING PLACE? SUBHAS: I THINK EVERYONE WANTS A PIECE
OF THE CAKE. DEMAND IS THERE.
ASIA IS EXPECTED TO TRIPLE IN TERMS OF PASSENGER TRAFFIC, SO
IT MIGHT HAVE BEEN PUT BACK BY A FEW YEARS.
HASLINDA: DEMAND HAS DRIVEN PRICES
SOMEWHAT. WILL THAT NORMALIZE OR IS THAT
THE NEW NORMAL? SUBHAS: I THINK IT WILL NORMALIZE.
IN TERMS OF PENT-UP DEMAND, IT IS UP SIX OR SEVEN TIMES WHAT
IT WAS BEFORE. IN TERMS OF THE NUMBER OF
FLIGHTS, WE'VE SEEN A DOUBLING OF FLIGHTS FROM THE
ASIA-PACIFIC REGION. THERE IS ROOM TO GROW.
AIRLINES ARE CRANKING UP THEIR RESOURCES TO MEET THE PENT-UP
DEMAND. HASLINDA: WHEN DO YOU SEE THAT HAPPENING?
SUBHAS: TOWARD THE END OF THIS YEAR, I
THINK AIRLINES WILL BE ABLE. HASLINDA:
QUITE PHENOMENAL WE ARE SEEING RECORD ORDERS OF AIRLINES OR
JETS FOR INDIA. DO YOU SEE INDIA ON THE CUSP OF
MASSIVE GROWTH? WHAT TREND DO YOU SEE
DEVELOPING? SUBHAS:
INDIA IS INTERESTING SCENARIO BECAUSE THEY HAVE REVAMPED
THEIR WHOLE AVIATION INDUSTRY.
IT IS A NEW, REJUVENATED, PRIVATIZED AIR INDIA AND IT'S
DRIVING MOST OF THE ORDERS FROM INDIA.
IF YOU LOOK AT 2022, I SAID CHINA IS THE ELEPHANT IN THE
ROOM BUT INDIA WAS THE ELEPHANT IN THE ROOM.
IF YOU LOOK AT SOME OF THE TOP TOURIST DESTINATIONS LIKE BALI
AND BANGKOK, INDIA APPEARED IN THE TOP 10 ALREADY.
TOGETHER WITH INDONESIA, I THINK WE WILL SEE THE
ASIA-PACIFIC MARKET RECOVERY. HASLINDA:
WHAT KIND OF GROWTH ARE YOU ANTICIPATING IN THE NEXT TWO OR
THREE YEARS? SUBHAS:
WE WILL SEE INDIA SEVERAL TIMES MORE THAN IT WAS IN 2019.
HASLINDA: CAN YOU DEFINE THAT? SUBHAS:
ANYWHERE BETWEEN FOUR TO FIVE TIMES MORE.