Asia Pacific air travel and cargo demand continue to rise, but supply chain bottlenecks threaten to stall the industry's momentum as the world’s largest air transport market.
Despite strong demand, growth has started to moderate in 2025, according to the Association of Asia Pacific Airlines (AAPA). Average load factors have reached a record 83%, reflecting capacity constraints.
"In 2025, over one-fifth of aircraft deliveries are expected to be delayed," said Subhas Menon, AAPA director general.
"Pandemic-induced supply chain disruptions remain unresolved, and there’s no clear path to any meaningful alleviation of these constraints. The U.S. government's tariffs onslaught is set to further complicate an already fragile ecosystem."
AAPA noted that aircraft and engine manufacturing rely on components sourced worldwide, but new tariffs and retaliatory measures risk driving up costs and slowing production—burdens that ultimately fall on airlines and their customers.
"Aviation supply chains were built on the efficiencies of open markets and international cooperation," Menon said.
"Now, that framework is being wholly undermined. Free trade has always lifted aviation—and the broader economy. Trade barriers do the opposite, dragging everyone down."
The AAPA director general noted that this supply chain crisis also threatens the industry's path to net-zero emissions by 2050.
He noted that delayed aircraft deliveries mean airlines must keep older, less efficient models in service, missing out on emissions reductions.
Compounding this issue is the limited supply of Sustainable Aviation Fuel (SAF). Of the 1.5 million tonnes projected for 2024, only 1 million tonnes were produced.
"Worryingly, very few traditional fuel suppliers have joined the SAF supply chain," Menon said.
"Demand for SAF continues to outstrip supply, and costs remain prohibitively high. Regulatory frameworks to encourage SAF production are still underdeveloped, inconsistent, or insufficient."
Menon went on to note that Asia Pacific carriers remain crucial to global economic connectivity, but rising regulatory hurdles, surging equipment costs, and ongoing shortages pose long-term risks.
"Aviation is a catalyst for sustainable economies and global connectivity," the AAPA director general said.
"Its contribution to economic and social development is an outsized one, particularly in the Asia Pacific region. Air services are clearly in demand, but meeting the demand is more difficult now due to factors outside the control of airlines. Governments and suppliers must step up to tackle this disconnect."