Airline Route Planning Software Industry

Airline Route Profitability Software Market Analysis

The Airline Route Profitability Software Market is expected to register a CAGR of greater than 7% during the forecast period.

The COVID-19 pandemic harmed the airline route profitability software market. A pandemic led to a decline in terms of trade. Lockdowns in various countries affected the aviation industry. This was due to a decline in aircraft operations and passenger traffic the most impacted by the pandemic. Moreover, there was a fall in the demand for airline route profitability software worldwide. This was due to the shortage of parts and components required for manufacturing these systems owing to restrictions on trade and travel that led to the pandemic affecting the market negatively. On the other hand, the decline in the COVID-19 pandemic led to the opening up of various counties' borders, facilitating free trade flow. With the lifting of the lockdown policies imposed by various governments, there was an ease in the availability of raw materials. Manufacturers witnessed a significant increase in production. Moreover, the gradual increase in demand for airline route profitability software systems globally led to the market witnessing growth, which will continue during the forecast period.

The airlines' procurement of advanced software suites to maximize the ever-growing aviation market is one of the major driving factors of the airline route profitability software market. AI, augmented reality, virtual reality, mobile, and conversational commerce are some of the new technologies that will assist airlines in intelligent retailing and scaling their businesses. Such advancements in profitability software are expected to have a positive impact on the growth of the market.

Airline Route Profitability Software Market Trends

Domestic Airlines Segment is Expected to Witness Significant Growth During the Forecast Period

By end user, the domestic airline segment is expected to witness significant growth during the forecast period. An increase in the demand for domestic airline operations worldwide owing to the increase in air passenger traffic is the main factor for the market to witness significant growth. The International Air Transport Association (IATA) announced that air passenger traffic increased in September 2022. In September 2022, total air traffic increased by 57% compared to September 2021. Moreover, domestic air traffic in September 2022 grew by 6.9% compared to September 2021, whereas air passenger traffic in September 2022 rose by 122% compared to the previous year.

In 2022, Asia-Pacific witnessed significant growth owing to the ease of border restrictions by countries such as Japan, Hong Kong, and Taiwan. Various domestic airlines worldwide are now assessing the most profitable routes to increase their market share and profitability. Moreover, since the restart of civil aviation, there has been a dynamic shift in route profiles. This has led to airlines launching many sectors to fulfill the new demand to connect Tier II cities. Such developments in the domestic airline segment will lead the market to witness significant growth during the forecast period.

The Asia-Pacific Region is Expected to Witness Significant Growth During the Forecast Period

The Asia-Pacific region is anticipated to have the highest growth during the forecast period. The region has been a center of a fast-growing aviation industry with China and India as the main hubs of aviation. Moreover, according to Asia business news, in the past decade, the Asia-Pacific region has become the fastest-growing in the world for airline activity. The growing population in the Asia-Pacific region coupled with an increase in the percentage of the population with enough disposable income will be the major factors that contribute to air travel becoming a success story in the region. According to the International Air Transport Association (IATA), the growth in the number of air travelers in the Asia-Pacific will increase and reach 2.1 billion passengers a year by 2036. Moreover, the Association of Asia-Pacific Airlines (AAPA) has reported an increase of 821% for the month of August 2022 in the number of international passengers in the Asia-Pacific region. The healthy growth in the number of passengers points to a strong travel demand from the business and leisure sectors. In order to make profits from growing air travel in the region, airlines are currently engaged in making strategic investments and plan to expand their presence in this region. The airlines in the Asia-Pacific region are also making use of route profitability software to evaluate the existing routes, to know the profit margins and plans & budgets profitability of routes so that new routes can be undertaken in the future. For instance, in 2022, Air India which is owned by Tata Group is optimizing its domestic strategy by diversifying its presence on metro-to-metro routes and exiting from unviable ones. Thus, such developments will lead to a growth in the market during the forecast period.

Airline Route Profitability Software Industry Overview

The market is moderately fragmented, with many players providing various airline software platforms. The prominent players in the airline route profitability software market are SITA, Sabre Corporation, IBM, NIIT Technologies Limited, and Airpas Aviation GmbH amongst others.

The long-term agreements between the software providers and airlines are a major factor in helping the local players to maintain their market position despite high competition. The development of new digital solutions by integrating advanced technologies via periodical software updates to create schedules that are more reliable, more profitable, quicker, and easier to develop is generating more business value.

Airline Route Profitability Software Market Leaders

Airline Route Profitability Software Market News

In October 2022, African Airlines Association (AFRAA) announced that they have launched a dedicated aviation route intelligence portal in partnership with the leading African market intelligence provider Milanamos. The data-backed portal is a gateway for airlines to access useful market insights on networks within Africa and routes from Africa to the rest of the world.

In July 2022, five new airlines namely Aero Mexico. Air Canada, LATAM, Volaris, and Westjet have been added to airline profitability data developed by the RDC aviation company.