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Opinion: Small right-sized narrow-bodies will be at the forefront of aviation recovery

written by WOFA | March 23, 2021

A an artist's impression of an Embraer E-jet and Boeing 737 flying in formation. (Boeing/Embraer)
A an artist’s impression of an Embraer E-jet and Boeing 737 flying in formation. (Boeing/Embraer)

Singapore-based Victor Vieira dos Santos shares his insight into the ongoing global recovery of the aviation industry, and the significant place of smaller narrow-bodied aircraft.

As we head into the second quarter of 2021, we continue to see airlines in Asia-Pacific grapple with the continued impact the pandemic has had on travel demand.

While the vaccine programs have injected optimism worldwide, the unlikely situation of a V-shaped recovery is almost an understatement.

According to IATA, international passenger demand in January this year was 85.6 per cent below January 2019, a further drop compared to the 85.3 per cent year-to-year decline recorded in December 2019.

How long will it take for us to get back to the historical growth trajectory seen before 2020, if at all? Should we use pre-COVID levels as an indicator for “normality”?

Bear in mind, the situation pre-COVID was not all that rosy for airlines – in Asia, profit per passenger was averaging US$3 in 2019 after years of continuous decline, along with the proliferation of low-cost carriers in the region.

While demand for domestic tourism and short distance VFR traffic (visiting friends and relatives) continues to recover, the demand for long-haul flights has dissipated. Looking at business travel, companies are now much more aware of the clear benefits of telecommuting and teleconferencing, so less business passenger traffic is to be expected in the foreseeable future.


It is increasingly clear that the domestic connectivity – or regional connectivity in the case of small states like Singapore – will lead to the recovery for air travel demand. Strategically re-establishing connections and frequencies will be a more important long-term metric in the new normal that the traditional metric of traffic volumes.

In that respect, we believe that smaller and efficient narrow-bodies with a capacity of up to 150 seats will be at the centre of recovery.

Smaller, right-sized aircraft are the best way to resume or grow domestic and regional connectivity at a time when overall passenger demand has weakened.

It is a crucial tool in an airline’s aircraft fleet, giving its network planning department the flexibility to cope with fluctuations in demand for air services, while strategically increasing the number of
connections as the demand and passenger numbers grow.

The move towards the increased utilisation of smaller narrow-bodies has started. Globally, 80 per cent of the E-Jets fleet are in operation as of January 2021 and in Asia-Pacific, it stands at 90 per cent.

Looking at China, which is leading the aviation sector recovery in Asia, the increased use of smaller aircraft on their domestic routes has been key to the resurgence of domestic air travel
growth in a relative short period of time.

Smaller narrow-bodies jets flew 13 per cent more flights in the fourth quarter of 2020 than in the same quarter of 2019, while widebodies saw a 44 per cent decline in the flights performed during the same period.

We see the rightsizing of fleet and operations by marquee airlines such as Japan Airlines, Qantas, KLM and United Airlines.

In the fourth quarter of 2020, airlines in Japan continued to operate 227 destinations domestically and internationally – a slight drop from the 255 in the same quarter of 2019. This was achieved by using the existing fleet of smaller jets and turboprops, while there was a 67 per cent drop in large widebody flights and a 37 per cent reduction of bigger narrow-bodies.

In Australia, where most operations in 2020 were largely domestic, airlines have reduced the average aircraft size in service, from an average of 161 seats per departure in the fourth quarter
of 2019 to just 120 seats per departure in the fourth quarter of 2020.

Qantas recently announced the operation of the E190 in partnership with Alliance Airlines as part of its “the right aircraft on the right route” strategy.

Looking beyond the region, in 2020, KLM’s fleet of E-Jets performed 85 per cent of all flights operated by the airline. KLM recently added its 50th E-Jet, the first E195-E2, highlighting the importance of right-sized jets.

One out of three flights operated by Japan Airlines, United Airlines and Lufthansa is offered by E-Jets.

There is always a need for large widebodies – for long-haul travel and cargo transport. Hub-and- spoke systems will continue to play their paramount importance after COVID-19.

However, airlines will need to search for the most efficient structure to fill the seats on their international flights amidst a lower-demand environment.

This is why the current situation calls for smaller narrow-bodies to “step up” in order optimise airline operations.

Smaller narrow-bodies provide airlines the flexibility to place the aircraft on strategically important routes where demand is currently thin.

As the situation changes, the airline can scale up capacity by increasing flight frequency or switching to a larger aircraft in its fleet.

The up-to-150 seat segment is here to stay and is not just a passing trend for the current downturn in the airline industry. It offers lower operating cost, all the more imperative especially nowadays with the depressed passenger demand.

It is an asset that will unlock opportunities for airlines to open up connections to more cities and this will benefit travellers.

In addition, these non-stop point-to-point connections within the region would provide travellers with more options to shorten their travel time by bypassing unnecessary transits through hubs.

Everybody wins – shorter travel times, more manageable passenger movements at gates and inside the flight, and less load on airport infrastructure.

It will take time before passenger demand returns to the volumes that will bring back the fleet of large aircraft that are presently parked in storage.

Until then, airlines can keep their operations cost-effective by having smaller narrow-bodies adapted to the prevailing market conditions and strengthen domestic and regional connectivity.

Singapore-based Victor Vieira dos Santos is the Commercial Aviation Marketing Director for Embraer’s Asia-Pacific business. He has been with the company for more than 10 years. Victor holds two bachelors, in Business Administration and in International Affairs, as well as an MBA from the University of Sao Paulo.


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