A recent report released by PricewaterhouseCoopers has analyzed the worldwide airline industry and discovered that the next two decades is likely to see global demand for airline travel to double. This expansion, the report states, is a combination of the rise of a global middle class looking to enjoy trips further afield.
The growth presents some challenges to the airline industry, with additional infrastructure needed in order to handle the increased amount of passengers year by year—while also dealing with the rigors of volatile fuel costs, which are set to also fluctuate.
While many current CEOs at major airline companies worldwide are aware that the current infrastructure is not enough to competently handle this growth, they are said to be focusing their new infrastructure efforts in those countries in which the middle class is showing signs of acceleration—and potentially at the expense of infrastructure in the United States.
These nations are typically the developing nations in South America, China and India—where there is a basic infrastructure in place, but the middle class is growing exponentially and likely to wish to enjoy trips such as those enjoyed by those in the West for the past few decades.
The trade group for U.S. carriers, Airlines For America, has stated that $70 billion has been invested in projects since 2008—and that many new projects are invested in NextGen, a new set of air traffic upgrades that the industry promises will make air travel even more streamlined than it already is.
This boom has been aided by the recent toppling of fuel prices, from $102 in April 2014 to $64 in June 2015, which has netted the airlines a $70 billion windfall to spend elsewhere on upgrades, improvements and marketing.
Despite this windfall, the ongoing costs of hiring and training staff to meet the increased demands for air travel still need to be taken into account, particularly with growth set to double so dramatically in the space of just twenty years—and with PricewaterhouseCoopers stating that some 2.7 million new pilots, stewards, stewardesses, engineers and various other staff required to be hired in the aviation industry as a bare minimum in the next decade, the expense will not be a negligible one.
For more information, see the report in USA Today.
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