According to the Market Statsville Group (MSG), the global new distribution capability market size is expected to grow at a CAGR of 15.4% from 2023 to 2033.  

All airlines share two core needs: generating income and satisfying passengers. Carriers look for ways to better understand their consumers in order to satisfy them and offer a range of extra services, including baggage insurance and onboard catering. These services, which are sometimes known as ancillaries, are provided for an additional cost. Airlines strive to provide travelers with individualized material in order to market ancillaries to them and increase revenue. A new standard has evolved to address the problem since reaching the end user through the channels offered by global distribution systems (or GDSs) is practically impossible.

When the New Distribution Capability (or NDC) was introduced in 2012, the aviation industry was forced to deal with significant changes. The first airlines to use NDC were Lufthansa, British Airways, American Airlines, and Iberia. Additionally, the technology continues to flourish in airline distribution and improving airline operations.

COVID-19 Impact on the Global New Distribution Capability Market

The COVID-19 pandemic has significantly impacted the global economy, and the worldwide lockdown and travel restrictions severely affected the airline industry. However, the adoption of NDC saw a slight increase. Customers became comfortable with online transactions during the pandemic, which helped drive the NDC adoption during and post covid. Travel companies rapidly adopted this technology to enhance their digital retail practices and ancillary revenue. This ancillary revenue helped stabilize the distressed airline revenue. It took a fundamental shift in how airlines communicated and disseminated product data to win over the early detractors of the International Air Transport Association's (IATA) New Distribution Capability (NDC). NDC has emerged as a crucial instrument for boosting airline reservations and revenue due to wider adoption and the introduction of innovative merchandising applications.

 Global New Distribution Capability Market Dynamics

Drivers: Flourishing Tourism Industry

The years up to 2021 saw a gradual expansion in the global tourism sector. Except for 2020, there have been more visitors from abroad as per capita income throughout the world has climbed and consumer confidence has risen. Over the past five years, industry development has been driven by tourists traveling to and from emerging economies, particularly nations in Asia and South America. As per the latest UNWTO World Tourism Barometer, global tourism noticed a robust rebound post-Covid withinside the first 5 months of 2022, with nearly 250 million global arrivals recorded.  Rapid travel and tourism have been driving the adoption of NDC as companies wish to simplify the distribution process and improvise customer satisfaction. Airlines and travel & tourism companies are investing heavily in digital retailing, driving the growth of the NDC market.

Restraints: IATA Certification Mandates

New Distribution Capability was developed by the IATA (International Air Transportation Association). The companies can adopt NDC only after obtaining a certification from IATA.

• Applying for the NDC Certified label for a specific version or many readily available versions of NDC schemas at either level 2, 3, or 4 for airlines that deploy an NDC API, sellers, and aggregators that use an airline NDC API is possible.
• Any IT service providers who deliver goods based on the NDC standard for airlines and sellers/aggregators are eligible to apply for the NDC Capable label for a specific version or numerous versions of NDC schemas that are readily available at either Level 2, 3 or 4.

Obtaining these certifications is a rigorous process; hence, some companies stick to the conventional distribution systems, restraining the adoption of NDC.

Scope of the Global New Distribution Capability Market

The study categorizes the new distribution capability market based on target customers at the regional and global levels.

By Target Customers (Sales, USD Billion, 2019-2033)

• Airline Companies
• Travel & Tourism Companies

By Region Outlook (Sales, USD Billion, 2019-2033)

• North America
  • US
  • Canada
  • Mexico
• Europe
  • Germany
  • Italy
  • France
  • UK
  • Spain
  • Poland
  • Russia
  • The Netherlands
  • Norway
  • Czech Republic
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Indonesia
  • Malaysia
  • Thailand
  • Singapore
  • Australia & New Zealand
  • Rest of Asia Pacific
• South America
  • Brazil
  • Argentina
  • Colombia
  • Rest of South America
• The Middle East & Africa
  • Saudi Arabia
  • UAE
  • South Africa
  • Northern Africa
  • Rest of MEA

Airline segment accounts for the largest market share during the forecast period by Target Customers

Based on target customers, the market is bifurcated into airline and travel & tourism companies. The airline segment accounts for the largest market share during the forecast period. Airlines are adopting NDC compared to tourism companies to enhance customer satisfaction. The cost of distribution has been the highest cost for airlines. Due to the pandemic's reduced volume of bookings, the airlines began to seize control of the offer, directly connect the customers and cut the GDS system out. The players began investing heavily in digital retailing and additional services to generate ancillary revenue. NDC reduced distribution costs and increased companies' revenues, allowing them to innovate and create product offerings. Hence, the usage of new distribution capability technology in airlines' distribution systems is accelerating the growth of the airline segment overall.

North America is projected to account for the largest market share, by Region

Based on the regions, the global new distribution capability market has been segmented across North America, Asia-Pacific, Europe, South America, and the Middle East & Africa. North America will dominate the global new distribution capability market in 2022.  Most air travel, both for passengers and cargo, occurs in North America, Europe, and East Asia, with North America having the greatest number. The geography of air travel in North America is primarily concerned with moving passengers through the several hubs run by different carriers in the market. Since the major firms have started implementing NDC in this area, it is anticipated that North America will hold the greatest market share throughout the anticipated time.

Competitive Landscape - Global New Distribution Capability Market

The global new distribution capability market is quite competitive, with key industry players adopting strategies such as product development, partnerships, acquisitions, agreements, and expansion to strengthen their market positions. Most market companies focus on expanding operations across regions, augmenting their capabilities, and building strong partner relations.

Major players in the global new distribution capability market are:

• Accelya
• Sabre
• Sirena-Travel JSC
• Techno Heaven Consultancy Pvt. Ltd.
• 2e Systems Gmbh
• Aaron Group
• Aerocrs
• Air Black Box
• Amadeus IT Group S.A.
• Birdres Technologies Pvt. Ltd
• DXC Technology
• Farenexus Group Inc
• Hitchhiker Gmbh
• Interes Gmbh
• Websky Tech
• Verteil Technologies PVT. LTD.

Recent Developments

• In May 2021, 2e Systems teamed up with American cloud-based data security company TokenEx. This collaboration will ensure that 2e Systems can offer and support airline clients with a solid data security solution to protect payment information.
• In July 2020, Accelya announced that the process of acquiring Farelogix was completed. This acquisition will accelerate customers’ digital transformations. It will provide a next-generation, end-to-end offer to the settlement airline commerce platform, including a full suite of innovative retailing, distribution, and fulfillment solutions.

Key Issues Addressed

• What is the market size by various segmentation of the new distribution capability by region and its respective countries?
• What are the customer buying behavior, key takeaways, and Porter's 5 forces of the new distribution capability market?
• What are the key opportunities and trends for manufacturers involved in the new distribution capability supply chain?
• What are the fundamental dynamics (drivers, restraints, opportunities, and challenges) of the market?
• What and how regulations, schemes, patents, and policies are impacting the growth of the market?
• What are the upcoming technological solutions influencing market trends? How will existing companies adapt to the new change in technology?
• The market player positioning, top winning strategies by years, company product developments, and launches will be?
• How has COVID-19 impacted the demand and sales of new distribution capability in the global market? Also, the expected BPS drop or rise count of the market and market predicted recovery period.
• Detailed analysis of the competitors and their latest launch, and what are the prominent startups introduced in the target market? Also, detailed company profiling of 25+ leading and prominent companies in the market.