Inflight Catering Market

Global Inflight Catering Market:

The global inflight catering market size reached US$ 13.3 Billion in 2023. Looking forward, IMARC Group expects the market to reach US$ 18.4 Billion by 2032, exhibiting a growth rate (CAGR) of 3.6% during 2024-2032. The widespread adoption of inflight catering across the aviation industry on account of the increasing competition amongst the airlines represents one of the key factors driving the market growth.

Global Inflight Catering Market Analysis:

• Major Market Driver: The need for serving enhanced onboard dining experience is contributing to the market growth. Moreover, the introduction of high-level services, including meal pre-selection, mixed buy orders, and complimentary catering options to fulfill individual passenger requirements and comply with the hybrid operational scenarios at lower prices, is also contributing to the market growth.
• Key Market Trends: Significant technological advancements and the rising automation in the food and beverage (F&B) industry are primary key trends of the market. Airlines are utilizing tablets and mobile devices for ordering meals to ensure the smooth functioning and management of catering services.
• Geographical Trends: On a regional level, the market has been classified into North America, Asia-Pacific, Europe, Latin America, and the Middle East and Africa, where Asia-Pacific currently dominates the global market.
• Competitive Landscape: Some of the leading players operating in the global inflight catering market include AAS Catering Co. Ltd, Abby's Catering, and Cathay Pacific Catering Services (H.K.) Ltd. (Cathay Pacific Airways), DO & CO Aktiengesellschaft, Emirates Flight Catering (The Emirates Group), Flying Food Group, Gategroup, Jetfinity, KLM Catering Services Schiphol, LSG Sky Chefs (Lufthansa AG), Sats Ltd. (Singapore Airlines), Saudi Airlines Catering, and Universal Weather and Aviation Inc., among others.
• Challenges and Opportunities: Implementation of stringent norms regarding airline catering is one of the significant challenges faced by operators in the market. However, numerous market players are taking steps to adhere to government guidelines and standards, which are anticipated to propel the growth of the market in the coming years.
   

Global Inflight Catering Market Trends:

Growth in Air Travel

Population growth, elevating levels of urbanization, and changing demographics, such as the growing middle class in many parts of the world, are contributing to the increased air travel demand across the world. As per the International Air Transportation Association (IATA) report, January 2024 was a strong start for the global industry. For instance, total revenue passenger-kilometers (RPK) increased 16.6% year-on-year (YoY) in January, the industry was closer than ever to monthly recovery as traffic levels reached 99.6% of 2019 levels (pre-pandemic year). In addition to this, international traffic maintained an upward trend, January RPK equaled 95.7% of pre-pandemic levels and increased 20.8% YoY. Moreover, various airlines are providing rich passenger experience due to the rising automation of the in-flight catering system and improvements in catering management. Airlines continually seek personalized services for potential onboard consumers, like pre-ordered meal services. In March 2022, Newrest announced that the company began providing hot meal services on two-class flights of Air Transat from various countries across Europe like, Belgium, England, France, the Netherlands, Portugal, and Spain. Additionally, airlines are also adopting a novel trend of providing continental meal options to their customers, which helps meet their specific meal requests and raises customer satisfaction. This, in turn, is anticipated to offer lucrative growth opportunities to the overall market.

Airline Competition and Differentiation

The increasing competition among the airlines is resulting in the adoption of certain strategies that enhance the inflight dining experience. These strategies range from the process of ordering food to serving. Additionally, airlines are using different service strategies for different classes on the same flight to comply with hybrid operational scenarios while providing service to the customers. For instance, while providing high-level services at a premium price to high-value customers (in business and first-class), airlines are also offering lower-price alternatives to passengers in economy class, thereby establishing tier-based complimentary onboard services. In accordance with this, in November 2021, the Indian low-cost carrier IndiGo announced that it was resuming its meal services that had been suspended since the COVID-19 pandemic. The airline's announcement came after the Indian Civil Aviation Ministry allowed airlines to resume in-flight meal services on all domestic flights. Besides this, the versatility of cultural dining always adds to the comfort and interest of travelers. For instance, in international flights flying to regions where there is a huge level of diversification in food habits, such as the Middle East, caterers are designing meals in accordance with their understanding of the tastes of destination flyers. Such initiatives are projected to bolster the inflight catering market revenue in the coming years.

Airline Alliances and Partnership

Various airlines and catering service providers are forming alliances and partnerships to leverage their combined purchasing power to negotiate better deals with catering suppliers. Moreover, bulk purchasing can lead to cost savings on food and beverage items, as well as on the logistics and distribution of catering services. Moreover, such partnerships allow airlines to standardize catering services and maintain consistency and quality in the inflight dining experience. For example, In July 2021, gategroup signed a partnership renewal agreement with LATAM Airlines to provide inflight catering services for an additional five years. According to the agreement, gategroup will serve LATAM Airlines at 16 locations, which include two new strategic domestic locations: Bogotá, Colombia, and Santiago, Chile. Similarly, in June 2023, Gulf Marketing Group, a health and wellness organization, collaborated with Emirates Flight Catering to offer a unique line of on-the-go meals. Fresh, high-quality ingredients are used to produce the meals, packaged in recyclable materials. The menu contains foods to meet various dietary preferences, including vegetarian, vegan, and gluten-free options. The meals are available at GMG's retail locations around the UAE. Such initiatives and the escalating number of partnerships between caterers and airlines are projected to propel the inflight catering market share over the forecasted period.

Key Market Segmentation:

IMARC Group provides an analysis of the key trends in each sub-segment of the global inflight catering market report, along with forecasts at the global, regional and country levels from 2024-2032. Our report has categorized the market based on food type, flight service type and aircraft seating class.

Breakup by Food Type:

• Meals
• Bakery and Confectionary
• Beverages
• Others
   

Meals represent the largest segment

The report has provided a detailed breakup and analysis of the market based on the food type. This includes meals, bakery and confectionary, beverages, and others. According to the report, meals represent the largest segment.

The advent of ready-to-eat meals for travelers and rising demand for catering services on long-distance, nonstop flights are key factors propelling the market growth. The major companies that provide in-flight catering are taking initiatives to provide meals to culturally diverse passengers. Various companies are increasingly investing in in-flight catering services to enhance the customer experience. For instance, in June 2023, Dnata, a flight and travel services provider, renewed its long-term partnership with Lufthansa and SWISS in Singapore. The new contract sets Dnata to continue to provide high-quality inflight catering services to the two airlines from its state-of-the-art facility at Changi Airport.

Breakup by Flight Service Type:

• Full-Service Carriers
• Low-Cost Carriers
   

Low-cost carriers hold the largest market share in the food service type

Based on the flight service type, the global inflight catering market can be bifurcated into full-service carriers and low-cost carriers. According to the report, low-cost carriers exhibit a clear dominance in the market.

Low-cost carriers (LCCs) typically operate on a no-frills model, focusing on providing affordable air travel while minimizing operational costs. LCCs typically offer a more limited selection of food and beverage options compared to full-service airlines. This helps to streamline operations and reduce catering costs. Passengers may have the option to purchase snacks, sandwiches, and beverages onboard, but the menu is often limited to items that are easy to prepare and serve quickly.

Breakup by Aircraft Seating Class:

• Economy Class
• Business Class
• First Class
   

Based on the aircraft seating class, the global inflight catering market can be bifurcated into economy class, business class, and first class. Airlines are using different service strategies for different classes on the same flight to comply with hybrid operational scenarios while providing service to the customers. For instance, while providing high-level services at a premium price to high-value customers (in business and first-class), airlines are also offering lower-price alternatives to passengers in economy class, thereby establishing tier-based complimentary onboard services.

Breakup by Region:

• North America
  • United States
  • Canada
• Asia-Pacific
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Indonesia
  • Others
• Europe
  • Germany
  • France
  • United Kingdom
  • Italy
  • Spain
  • Russia
  • Others
• Latin America
  • Brazil
  • Mexico
  • Others
• Middle East and Africa
   

Asia-Pacific currently dominates the global market

On a regional level, the market has been classified into North America, Asia-Pacific, Europe, Latin America, and Middle East and Africa. According to the report, Asia-Pacific currently dominates the global market.

The boost in air travel in the Asia Pacific region is adding a new dimension to the inflight catering services business. With the increasing air travel in this region, the induction of new destinations and new long-haul flights is creating future opportunities for the Asia-Pacific inflight catering market. Moreover, various key market players in the region are expanding their operations and investing in enhancing customer services, which is creating a positive outlook for the overall market. For instance, In September 2022, SATS Ltd., agreed to buy Worldwide Flight Services (WFS) for EURO 1.2 billion (US$ 1.1 Billion) in a deal that will transform Singapore's catering and gateway services company into the world's biggest handler of airborne freight. Additionally, in July 2021, SATS announced that they are setting up the first central kitchen in India with an investment of INR 210 crore (USD 25.3 million) to cater to the company's growing customer base across the region. Such investments in the region will continue to contribute to the growth of the market.

Competitive Landscape:

The report has provided a comprehensive analysis of the competitive landscape in the market. Detailed profiles of all major companies have also been provided. Some of the top inflight catering companies include:

• AAS Catering Co. Ltd
• Abby's Catering
• Cathay Pacific Catering Services (H.K.) Ltd. (Cathay Pacific Airways)
• DO & CO Aktiengesellschaft
• Emirates Flight Catering (The Emirates Group)
• Flying Food Group
• Gategroup
• Jetfinity
• KLM Catering Services Schiphol
• LSG Sky Chefs (Lufthansa AG) Sats Ltd. (Singapore Airlines)
• Saudi Airlines Catering
• Universal Weather and Aviation Inc.
   

Global Inflight Catering Market News:

• February 2024: Qatar Airways and gategroup announced a new catering partnership to elevate inflight dining, structured through a Business Management Agreement that will see collaboration on passenger dining experiences, sourcing and procurement, healthy eating, as well as sustainability. 
• October 2023: Inflight caterer TajSATS signed a concession agreement today for the development of an in-flight kitchen facility at the upcoming Noida International Airport (NIA). TajSATS will develop the in-flight kitchen facility on a design, finance, build, operate and transfer (DBFOT) model for a period of 37 years, according to the agreement.
• June 2023: Dnata, a flight and travel services provider, introduced a culinary robot at the World Travel Catering & Onboard Services Expo (WTCE). The robot is the world's first AI-powered cooking robot, capable of performing cooking tasks in commercial and domestic kitchens.

Global Inflight Catering Market Report Coverage:

Key Benefits for Stakeholders:

• IMARC’s report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the inflight catering market from 2018-2032.
• The research study provides the latest information on the market drivers, challenges, and opportunities in the global inflight catering market.
• The study maps the leading, as well as the fastest-growing, regional markets. It further enables stakeholders to identify the key country-level markets within each region.
• Porter's five forces analysis assist stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the inflight catering industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.