A severe worldwide economic downturn in 2000 to 2003 caused a drop in world air traffic. The outbreak of the Iraq War in March 2003 and the SARS disease the following month contributed to the industry's difficulties. Since that downturn, low cost carriers -- LCCs -- have been expanding their market shares. The LCC category includes Southwest, JetBlue, Ryanair and easyJet.
Though the North American region continues to have the largest market share in terms of revenue passenger kilometers -- or RPK -- its growth rate is slower than that of the rest of the world, especially that of the Asia-Pacific region. The Asia-Pacific RPK increased by an average of 7.9 percent a year between 1986 and 2006. The North American region's comparable figure was 3.9 percent. The Japan Aircraft Development Corp. has estimated that the Asia-Pacific region will be the largest market in the world by 2026.
By 2029, airlines will require 20,000 new jets of the variety usually employed for long hauls -- more than 120 seats, according to an estimate by Embraer, a Brazil-based aerospace conglomerate. Nearly half of these -- 46 percent -- will be used to replace aging aircraft; the remainder will represent growth.
The aviation industry is divided into several parts. There are recreational aircraft, sold or leased; business aircraft; military procurement; and commercial transport aircraft. In the commercial transport market, the airlines are buyers. Various manufacturers and service industries are sellers.