Passenger volume to double in two decades: ACI

Airports Council International (ACI), the body representing the world’s airports, predicts that the volume of aviation passenger traffic will double by the year 2025, reaching a total of more than nine billion annually. Volumes will rise by an average of four percent annually over the period, with international volumes outpacing domestic. The Middle East will be the fastest growing region initially, with India and China also posting strong expansion. North America will remain the largest aviation market for another decade or so, with Asia ultimately taking over. Surprisingly, North America and Europe, despite being seen as mature markets, will actually post stronger than expected growth, at least in the first part of the period under study.

While the growth signals a bull market for aviation and aviation-related services, there will be growing pains, ACI director general Robert Aaronson told Gateway International. Aaronson said that in doing the research for “Global Traffic Forecast: 2006-2025,” ACI asked airports for their impression of their ability to keep up with growth in demand over the period in question. “We came up with a one billion passenger shortfall in 2020, relative to what would be needed to provide an adequate level of service to passengers,” Aaronson said. “The ramifications and implications of that are pretty stark.” There will be increased delays throughout the system, but these will be especially severe in certain critical locations, Aaronson said.

With the type of growth anticipated, it’s unlikely that aviation infrastructure will be able to adapt completely and prevent any problems, but Aaronson said that changes can be made that will help airports to adapt more quickly. One step governments can take is to reduce the bureaucracy that slows down project approval cycles. Aaronson noted with approval that the U.S. government introduced legislation a couple of years ago to speed up the environmental assessments required before airports could begin expansion projects.

Privatization is one measure often cited as a guarantee of improved efficiency, and while Aaronson does feel that it usually helps, success isn’t inevitable by any means. It’s a vital element in India, which has taken an aggressive approach to liberalizing its aviation sector. But in talking about China, which faces positively disruptive growth in aviation as well as a host of other sectors, Aaronson is careful to note that it’s equally important that the central government act with a sense of urgency.

China plans to build no fewer than 48 new airports, an expansion program of unprecedented scale. While privatization does figure in some of the plans, Aaronson doesn’t think it’s the key ingredient. He believes that it’s much more important that the government has a well developed plan whose scale matches the expected demand. “We view China as an encouraging example where the government has recognized the need and does have plans,” he told GI. Behind the support of any central government – let alone the massive one in China – is the corollary that required funding will be available.

Although it faces the most severe test, Asia may in fact be in a better position to respond than other parts of the world where aviation is more highly developed, Aaronson said. “As compared with trying to expand an existing airport like Heathrow, in many ways Asian airports are better off.” New and newly upgraded facilities, such as Thailand’s Suvarnabhumi and Singapore’s Changi are examples. Other major airports, such as Hong Kong International, will be able to expand as required relatively easily.

Gateway International’s discussion with Aaronson revolved around growth in passenger volumes. In fact ACI’s study, conducted by market research specialists DKMA, predicted that air freight volumes will grow even faster, almost tripling by 2025. But Aaronson said that the organization isn’t as concerned about this possibility, because cargo traffic is easier to schedule into off-peak hours when airport capacity is available, and air cargo facilities are much easier, faster and cheaper to build or expand than passenger terminals.