Feeling the pinch

One example is Japan where embryo low-cost operators are being hit hard. All Nippon Airways-owned budget carrier Vanilla Air cut 154 flights from its domestic schedule in June because of a lack of crew and more trimming is expected. Japan Airlines’ no-frills Peach Aviation is slicing more than 2,000 flights through to October for the same reason. They’re not alone. In China, India, Indonesia, the Philippines, Vietnam and elsewhere finding the trained personnel to fly the burgeoning numbers of aircraft being delivered to the region has become a nightmare for airline managements.

Privately-owned Vietnamese LCC VietJet Air is another struggling to find pilots. Earlier this year it signed a $6. 4 billion contract with Airbus for 63 new single-aisle A320s, the lease of seven more and options on another 30. Aviation training consultancy Mil-Com Aerospace Group, which has been working with VietJet, said at this year’s Singapore Airshow the pilot crisis was very real. “All the airlines in Vietnam are heavily dependent on international pilots. They’re competing from the same pool of pilots as the Middle East, with the growth of Singapore, the growth of AirAsia. It’s that same pool that all these airlines are competing for, so it’s a big challenge in Vietnam,” said the company’s vice president Bony Sharma. During the Singapore show Mil-Com and Eagle Flight Training of New Zealand signed a Memorandum of Understanding with Vietnam’s Aerospace Engineering Services JSC (AESC) to open a flight school in Vietnam, focused on training pilots. “But even if we set up 100 flying schools tomorrow, it still wouldn’t be enough, the shortage is that extreme,” he added.

Training facilities are expanding as fast as they can to try and produce the estimated 185,600 new pilots needed in Asia Pacific between 2012 and 2031, accounting for 40 per cent of the global demand. Today, the region has about 26 per cent of the global total, according to Boeing. But the trainers can’t keep up. Until now the regional industry hasn’t been slow to place most of the blame on the fast-growing Gulf airlines, accusing them of poaching crew with attractive offers of tax-free pay and a host of other benefits. It is now clear there are plenty of home-grown issues contributing significantly to the problem. One is the phenomenal expansion of budget airlines, now providing around 30 per cent of all the seats flying around the region. That will rise as unprecedented numbers of single aisles are delivered. LCCs in Asia – there are now 47 with 11 more planning to launch by early next year – have more than 1,200 aircraft

It’s that same pool that all these airlines are competing for, so it’s a big challenge.

on order. With six two-person crews needed for each aircraft keeping the pilot roster well supplied is becoming impossible for many.

LCC growth isn’t the only issue. China has become big problem number two. That country’s carriers now have more than 800 aircraft on order, on top of around 2,100 already flying. In an attempt to keep filling new flightdecks, they have been increasing pay offered to foreign pilots by 30 per cent or more. Some airlines are advertising annual salaries and benefits of up to $270,000, roughly double the average wage of a US airline captain. Indeed, on the website of industry publication Flightglobal Chinese airlines have at times accounted for around 60 per cent of recruitment advertisements. Most budget airlines, however desperate they are for crew, can only offer around half of the top pay of their Chinese counterparts. One country that has suffered badly is Korea – its airlines have lost dozens of pilots to the lure of higher pay in China.

For LCCs such as Peach in Japan, you might well ask: “Why can’t its owner ANA help out?” Well, while ANA has nearly 2,170 pilots on its books, it also faces shortages, especially with plans to increase the number of its own international flights by 45 per cent by 2016. In April it even introduced a new work program to lengthen the average number of flight hours for its flightdeck crew.

A further issue has been the improving conditions of the US airline market. Many US pilots who came to Asia when things were bad at home are now returning to their homeland.

Some industry observers believe the market will sort itself out. They suggest that in the long run infrastructure development won’t keep up with demand, placing natural brakes on growth. “If you don’t have enough airport capacity and runways or air traffic efficiency, it doesn’t matter how many planes you have if there isn’t anywhere to land them,” said one airline official.

That, however, is the last thing the region’s airline industry wants.