PERTH (March 25): The aviation industry's transition to net-zero emissions by 2050 requires stronger government and supplier support to ease the financial burden on airlines, said Association of Asia Pacific Airlines (AAPA) director general Subhas Menon.

Subhas, who spoke at the Routes Asia 2025 conference in Perth today, said that airlines are shouldering the heaviest cost load in the shift toward sustainability.

Citing the International Civil Aviation Organisation (ICAO) roadmap, Subhas highlighted that 66% of emission cuts must come from Sustainable Aviation Fuel (SAF) — a shift that will significantly raise fuel expenses.

“If you just look at the International Civil Aviation Organisation (ICAO) roadmap to 2050, the most important part of it is sustainable aviation.

"So the additional cost incurred by the global aviation industry for using sustainable aviation fuel (SAF) amounts to US$4.7 trillion (RM20.85 trillion) [from 2024 to 2050] and the majority of the cost will be borne by the airlines," said Subhas.

On top of that, government regulations like mandates and accompanying taxes will also mean that the costs are also borne by the airline, he added.

"In a nutshell, the cost that the airline industry is bearing will amount to US$744 billion (in 2050), compared to the US$1 billion that they are spending on fuel (in 2025),” he explained.

While Subhas raised the question of whether the cost attached to the transition to net zero is sustainable for the airline industry, he added that the industry will nevertheless get it done but emphasised that airlines would need “a lot of help” from governments as well as suppliers.

Subhas also said that while the global airline industry has experienced constraints in recent years from supply chain issues as well as lacklustre economic recovery from China, air traffic in the Asia Pacific has rebounded from the pre-pandemic levels in 2019.

“If you look at it from a capacity perspective, yes, it might suggest that the Asia-Pacific region hasn't recovered. But we know for a fact that there is a lot of demand for air travel, especially in the Asia Pacific. If you take a ‘glass half full’ perspective, you will see that we have already recovered beyond pre-pandemic levels since November 2024,” he pointed out.

International air passenger demand (measured by revenue passenger kilometre) in the Asia-Pacific region grew by 28% y-o-y in 2024, according to data from AAPA, while cargo demand (measured by freight tonne kilometre) grew by 15% over the same period.

It is the largest growth in any of the years, noted Subhas. The growth in the Asia-Pacific region outpaced the annual growth in other regions around the world in 2024.

Subhas added that the state of the airline industry matches that of the global economy, further saying that the current condition of the airline industry is “not too shabby” but also cautioned of the uncertainty surrounding macroeconomic headwinds.

“The air transport sector is a major conduit for the global economy. If the air transport sector is doing well, then tourism, investment, trade and, of course, the global economy also do well. Similarly, the global economy doing well is the reason why the air transport sector does well,” he said.