Dubai nudging Hong Kong out as transit hub between Asia-Pacific and Europe

Expanding the passenger-handling capacity of Hong Kong's airport, which is expected to run out by 2018, with a third runway - due to be completed 10 years from now - will fail to restore the city's role as a transit hub for flights between Asia-Pacific and Europe, analysts say.

Middle Eastern airports are muscling in on that turf, and Hong Kong may increasingly have to rely on traffic from the mainland, both outbound and inbound, to maintain its status as an air travel hub, remarks by analysts and airport management suggest - although here, as well, it is facing growing competition.

While traffic at Hong Kong International Airport showed lukewarm growth of 6 per cent last year to nearly 60 million passengers, that at Dubai International Airport jumped 15.2 per cent to 66.4 million. Dubai overtook Hong Kong as the third-busiest international airport in 2012.

Industry observers expect no additional landing slots will be offered at the Hong Kong airport from 2018 and airlines will be encouraged to optimise use of the limited space by consolidating routes and flying bigger planes.

Will Horton, a senior analyst at Capa, a Sydney-based aviation consultancy, said: "No amount of runway capacity at [the Hong Kong airport] or Singapore's Changi can compensate for what the Gulf carriers can offer in Europe by pooling traffic into a central hub and offering dozens of European destinations. But the third runway is, of course, still an urgent project and can ensure [Hong Kong] is a hub for Asia."

Hong Kong functions differently as a hub from Dubai, which is mainly a transit centre for air travel between East and West, as well as Europe and Africa. Two-thirds of the passengers at the Hong Kong airport, by contrast, are destined for or originate from the city. A majority of the remaining third are from the mainland.

"The hub function of Hong Kong is rather dictated by geographical factors," said a manager at Airport Authority Hong Kong. "We are well positioned to serve the mainland-Southeast Asia routes and the Australia-North Asia routes, although the latter is a very competitive market."