DOMESTIC AVIATION MARKET ANALYSIS

Market Concentration and Competitive Landscape

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Urbanization and growth of secondary cities

Rapid urbanization has been a major driver for the growth of the domestic aviation sector globally. Over the past few decades, large numbers of people have migrated from rural areas to cities in search of better livelihood opportunities and amenities offered in urban centers.  As a result, more than half the world's population now resides in cities, and this urban population continues to swell rapidly.  Many nations have also actively promoted policies to encourage urban development beyond primary metropolitan regions, in order to decongest major cities and promote balanced regional growth.  This has led to the emergence and rise of several new secondary cities and smaller towns, particularly in developing nations.

The rise of secondary cities has created new market opportunities for airlines to expand their domestic route networks and tap into previously underserved travel demand. Point-to-point air travel between these emerging urban centers and larger cities has surged, as passengers opt for the convenience and speed of flying over lengthy surface transport journeys. Airlines have rapidly launched new routes to capitalize on this fresh market potential.

Investments to develop and modernize airports in secondary cities aim to provide efficient air connectivity to drive their economic growth and integration with national and global markets. Improved air access is seen as a key enabler to attract investment, create jobs and boost tourism in these fast-growing urban regions.