New Pilots

Severe Asia-Pacific Pilot Shortage a huge opportunity for Trainers

2016 05 06

The Asia-Pacific region will need 230,000 pilots by 2030 and will have to train approximately 14,000 people annually to meet that need.

When Airbus Group SE and Singapore Airlines Ltd. opened a new pilot training centre in Singapore last month, Airbus’s CEO called the Asia-Pacific region a “key growth market.” That may have been the understatement of the century.

Demand for air travel in countries such as Indonesia, the Philippines and Vietnam is booming, driven by a growing middle class and the appearance of several new low-cost carriers.

Airbus predicts the region’s fleet of in-service aircraft will grow to 14,000 over the next two decades from 5,600 today, creating tremendous demand for pilots to fly all those new planes.

According to the most likely scenario put forward by the Montreal-based International Civil Aviation Organization (ICAO), the Asia-Pacific region will need 230,000 pilots by 2030 and will have to train approximately 14,000 people annually to meet that need.

However, the region currently only has the capacity to train about 5,000 people a year, leaving a whopping shortfall of 9,000 new pilots every year between now and 2030.

This deficit poses a serious problem for the region’s fast-growing airlines — some of which have had to cut back on flights or cancel expansion plans because of an inability to find qualified crews — but it also presents a huge opportunity for companies that provide training services.

Montreal-based CAE Inc., best known for its flight simulators, is also the largest commercial pilot trainer globally and in the Asia-Pacific region, where it has 15 training academies.

Much of this training is done through joint ventures with the region’s airlines, including Japan Airlines Co., China Eastern Airlines Corp., Malaysia’s AirAsia Bhd, Philippines-based Cebu Air Inc. and India’s InterGlobe Aviation Ltd.

“We’ve seen substantial growth over the last five years and, when you look at the projections of aircraft deliveries, we anticipate that growth will continue,” Irfan Khalid, CAE’s vice-president for Asia-Pacific, said in a phone interview from Kuala Lumpur.

The numbers are astounding. Boeing Co. projects that 100 million new passengers are expected to enter the Asia-Pacific market every year between 2014 and 2033, turning it into the world’s biggest air-travel market. By comparison, London’s Heathrow Airport handles 70 million passengers annually.

“Of course, what that translates to from a business standpoint is additional growth opportunities,” said Khalid.

Sam Kang Li/Bloombergan Airbus Group SE A320 simulator at the new Airbus Asia Training Centre (AATC), a joint venture, 55%-owned by Airbus and 45%-owned by Singapore Airlines.

However, it’s not always easy to operate in a region dealing with unprecedented growth. Recent accidents, including AirAsia Flight 8501, which crashed into the Java Sea in late 2014, and the disappearance of Malaysia Airlines Flight 370, raised serious concerns about whether safety practices have kept pace with the rapid growth of airlines, particularly new low-cost carriers.

Regulators in Southeast Asia have responded to safety concerns by shutting down some training schools and implementing strict rules for others, according to Max Buerger, head of institutional partnerships at U.K.-based training company Alpha Aviation Group Ltd.

Alpha, which operates pilot schools in the Philippines and the United Arab Emirates, is working to increase the capacity of its Manila operation, but Buerger said it’s impossible to keep pace with demand.

“In the Philippines we’re seeing the greatest growth and we’re also seeing the greatest problem in terms of pilot shortages,” Buerger said in a phone interview from Manila, where Alpha uses a CAE simulator to help train its cadets.

“Now we face the problem that we cannot satisfy the airlines’ demand and we simply cannot grow our capacity quick enough in order to keep up with the airlines. That problem is only going to get worse and worse.”

In addition, aviation regulations in Asia aren’t standardized the way they are in North America or Europe, resulting in a patchwork of rules that can raise costs for trainers, said CAE’s Khalid.

“The challenge there is if you’re trying to run an efficient training centre or if you’re trying to qualify simulators in different countries, the requirements might be different from place to place,” Khalid said.

“Hopefully in the next several years we’ll see some changes that will make things more standardized in Asia.”

In the meantime, it will be up to pilot trainers like CAE and Alpha Aviation to churn out as many qualified pilots as they can without compromising safety.

One way that Alpha Aviation is trying to help ease the pilot shortage is by attracting more women to its academies.

According to the International Society of Women Airline Pilots, only about three per cent of pilots worldwide are female. This presents a huge untapped market for airlines that are desperate for fresh blood.

“The only way we believe the airline industry and pilot training academies can address this (shortage) is by getting more women interested in becoming pilots, more gender equality,” Buerger said.

Alpha Aviation has had 42 female cadets at its Philippines academy, with the majority of them starting their training in the past 18 months.

There’s a misconception that pilots work long hours and are never home, which discourages women from considering it as a career, Buerger said. But the low-cost carriers that have come to dominate air travel in Southeast Asia tend to offer short-haul regional flights, meaning flight crews can return home to their families every night.

“We’ve really put a lot of our effort into letting women know that this can be a great career,” he said.

“Here in Asia, we’ve been really active in terms of trying to get more women to train and what we’re seeing is the more women are on campus … the more it encourages other women to join.”

However, the cost of training remains a major barrier to many would-be pilots, male or female.

Some airlines have moved away from subsidized pilot training, leaving it up to individuals to fund their educations. This is only exacerbating the pilot shortage, Buerger said.

“Airlines … are moving away from subsidizing pilot training, making it more and more self-sponsored, because at the end of the day it’s a huge cost burden on the airlines,” he said.

“But we think that in a couple of years that mentality will shift simply because they cannot get enough pilots. We can grow this market very easily if pilot training is subsidized.”