Airport Ground and Cargo Handling Services Market Size, Share & COVID-19 Impact Analysis, By Services (Passenger Handling, Baggage handling, Cargo and Mail Handling, Aircraft Handling, Ramp Handling, and Others), By Airport Type (Domestic and International), By Infrastructure Type (Greenfield Airport and Brownfield), and Regional Forecast, 2021-2028

The global airport ground and cargo handling services market size was USD 19.20 billion in 2020. The global impact of COVID-19 has been unprecedented and staggering, with airport ground and cargo handling services witnessing a negative demand shock across all regions amid the pandemic. Based on our analysis, the global market exhibited a decline of 46.50% in 2020 as compared to the average year-on-year growth during 2017-2019. The market is projected to grow from USD 15.74 billion in 2021 to USD 25.27 billion in 2028 at a CAGR of 7.0% in the 2021-2028 period. The sudden rise in CAGR and market revenues during the forecast period are attributable to the market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.

Airport ground and cargo handling services refers to taking care of the aircraft while it is present at the terminal. The services include passenger handling, baggage handling, ramp handling, and catering among others. The rising air traffic across the world and development of new airports in developing countries are set to drive the demand for these services during the forecast period. According to the International Air Transport Association (IATA), the air passenger traffic would be 8.2 billion in 2037.

Aviation Industry Has Faced Unprecedented Challenges Due to COVID-19 Pandemic

The outbreak of the COVID-19 pandemic has had a dramatic impact on air passenger traffic, associated services, and revenue. The global airport industry showcased multi-billion-dollar losses in 2020 due to the pandemic. According to the Airport Council International, there was a reduction of 620 million passengers in the first quarter of 2020. The sudden drop in air traffic resulted in huge losses in domestic and international airport revenues.

Although airports have high unavoidable fixed costs, therefore the airport management authorities are focusing on reducing variable costs by terminating infrastructure projects, delaying capital expenditures, minimizing investments in airport services, and addressing employment costs. Therefore, to overcome the impact of COVID-19, key players are restructuring their operational facilities to lower their expenses. Airlines across the globe are also focusing on shrinking their active fleet size to minimize business expenses. Thus, the lesser number of active fleets at airports will reduce the demand for airport services and hence will restrain the growth of this market.

LATEST TRENDS

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Rising Demand for Advanced Ground and Cargo Handling Systems at Smart Airports is a Vital Trend

The rising smart airport initiatives in developing countries are driving the demand for advanced airport ground and cargo handling services to enhance passenger safety and comfort. For instance, artificial intelligence (AI)-driven security systems at smart airports can reduce the time required for passenger check-ins. The emerging AI technology can help to improve airport landside security. Moreover, in 2019, Brisbane airport adopted the smart path biometric technology for Air New Zealand passengers, and this was the first airport to trial the seamless passenger boarding experience. The government of Australia is planning to automate over 90% of the air travel processing in the coming years.

DRIVING FACTORS

Increasing Expansion of Existing Airports and New Airport Projects to Foster Market Growth

The continuous rise in the number of air travelers in developing countries such as India and China is resulting in an increasing demand for the establishment of new airports in smaller cities. Thus, new airports are under constant development and the up-gradation of existing airports will amplify customer experience in the next few years. Moreover, the rising demand for longer runways, modernized air traffic control, and improved gate capacity, is expected to boost the demand for these services.

Airport expansion projects in developing countries would also lead to an increasing demand for cost-efficient airport ground and cargo handling services and amenities that are to be provided at airports. According to CAPA (Center for Asia Pacific Aviation) Centre for Aviation, the global airport expansion investments in 2019 was USD 137,254 million from which USD 62,398.0 million was invested for new airports and USD 74,856.0 million was invested for the upgradation of existing airports. Thus, the rising passenger traffic is anticipated to increase the demand for airport ground & cargo handling services.

Rising Demand for Low-cost Airlines and Domestic Flights to Foster Market Growth

In recent years, low-cost airlines have experienced rapid growth around the world due to increasing urbanization and economic activities. Moreover, the rising demand for travel & tourism, along with the ease of travel has supported the growth of the market. An increase in the demand for low-cost airlines has resulted in the surging development of low-cost airports which is anticipated to fuel the adoption of more airport ground and cargo handling services.

Furthermore, the rising affluence of the middle-class in developing countries is the basic cause for the increasing air passenger traffic. Due to the surging developments in business, tourism, and other sectors, the demand for domestic travel has increased. Thus, it would exhibit a rise in the demand for domestic flights. This will facilitate the growth of the market during the forecast period.

RESTRAINING FACTORS

Limited Lifespan of Ground Handling Equipment to Restrict Growth

Airline authorities are always focusing on adopting high-quality airport systems and providing a wide range of airport ground and cargo handling services to enhance passenger travel experience in minimal time. Hence, to offer improved aircraft and passenger supportive services, airline authorities require huge initial investments. However, the regular replacement of the airport system which has a short life cycle would result in additional capital expenditure. The ground handling equipment has a product lifespan of 6-9 years and requires replacement after a certain time period. Therefore, initial investments and the limited lifespan of the airport ground handling equipment are predicted to hinder the airport ground and cargo handling services market growth.

SEGMENTATION

By Services Analysis

Cargo and Mail Handling Segment to Experience the Fastest Growth

Based on services, the market is segmented into passenger handling, baggage handling, cargo and mail handling, aircraft handling, ramp handling, and others. The passenger handling service segment held the dominating share in 2020. An increasing focus on passenger security concerns and passenger comfort is expected to drive the growth of the segment. Passenger services facilitate the efficient transfer of passengers from initial check-in to boarding.

The baggage handling segment registered a significant share in 2020. This is due to the growing technological advancements in baggage handling systems from OEMs and security concerns at airports. On the other hand, the growing demand for aircraft loading/unloading, push back, load planning, marshaling, water servicing, and airport transportation are driving the demand for ramp handling services.

The air cargo and mail handling services segment is expected to grow at a highest CAGR during the forecast period. The increasing demand for air freights to transport goods such as emergency medical services during the pandemic is anticipated to drive the demand for cargo and mail handling services during the forecast period.

By Airport Type Analysis

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International Segment to Grow at a Faster Pace throughout the Forthcoming Years

Based on the airport type, the market is classified into domestic and international. The domestic segment is estimated to be the largest in 2020. An increasing number of domestic flights due to rising developments in tourism, business, and other sectors, is expected to drive the segment’s growth. According to the World Airport Traffic Forecasts, the CAGR of domestic passenger traffic is expected to be 3.4% during 2020-2027. The rising air traffic in emerging economies such as China and India would fuel the market growth.

On the other hand, the international segment account for an incremental growth during 2021-2028. This growth is attributable to the rising international air passengers’ traffic across the globe, the increasing number of airports and airlines, and surging expenditure on the aviation sector. According to the International Civil Aviation Organization (ICAO), the global passenger traffic will grow at 4.2% annually in the next 20 years.

By Infrastructure Type Analysis

Greenfield Segment to Hold a Dominant Share During the Forecast Period

Based on the infrastructure type, the market is divided into greenfield airport and brownfield airport. The greenfield airport segment was anticipated to be the largest segment in 2020, and it would continue its domination during the forecast period. An increasing number of greenfield airport projects in different countries would drive the growth of the segment. For instance, Beijing Daxing International Airport, a greenfield airport in China, was opened in September 2019. In India, Bhogapuram greenfield airport is expected to be open by 2022.

On the other hand, the brownfield segment is projected to show a significant CAGR during 2021-2028. This growth is due to the rising expenditure on airport modernization and upgradation. In 2020, Telangana, a state in India, planned to re-activate three old airports and create three greenfield airports. It would also think of the renewal of three brownfield airports under the scheme “Wings India 2020.”

REGIONAL INSIGHTS

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The global market is segmented based on region into North America, Europe, Asia-Pacific, and the rest of the world.

The airport ground and cargo handling services market in North America held a largest share in the base year. The market size stood at USD 5.43 billion in 2020. The growth is due to the presence of the highest number of airports, a well-flourished aviation industry, and rising expenditure on airport modernization.

The market in Europe is anticipated to show moderate growth during the forecast period. This growth is due to the increasing number of air travelers in countries such as the U.K., Germany, France, and others. The rising expenditure on the aviation sector would also boost the market growth across Europe.

The market in Asia Pacific is anticipated to witness the highest growth during the forecast period. Increasing international and domestic passenger traffic is set to support the market growth. In addition, the major investment for new airport projects in India would boost the demand for enhanced airport ground & cargo handling services.

For instance, in December 2020, the Airports Authority of India (AAI) began the construction of a new greenfield airport in Hollongi. The project cost is USD 87 million and includes the construction of a 4,100 sq.m passenger terminal building and airside works. The terminal will be equipped with eight check-in counters and will be able to process 200 passengers an hour. The project is expected to be completed by November 2022.

The market growth in the rest of the world is accredited to the development of smart airports. Also, increased tourism in the Middle East would drive the growth of the market.

KEY INDUSTRY PLAYERS

Key Players are Focusing on Providing Various Cost-efficient Services to Sustain in Market

The competitive landscape of the market is highly fragmented with the presence of several key players such as Dnata, Fraport AG, and Swissport International AG. These companies are focusing on providing cost-efficient services such as passenger and baggage handling, ramp handling, catering, and cargo handling services. All these companies are providing airport ground and cargo handling services according to the International Air Transport Association (IATA) Airport Handling Manual (AHM) 810 guidelines.

For instance, Fraport AG provides a full range of services as per AHM 810. Offering high-quality airport services, rising investments, and focus on making air travel safe and comfortable for customers are the reasons behind the company’s success.

LIST OF KEY COMPANIES PROFILED:

• Dnata (The UAE)


• Menzies Aviation (Scotland)


• Çelebi Ground Handling (Turkey)


• Aviapartner Group (Belgium)


• Swissport International AG (Switzerland)


• Worldwide Flight Services (France)


• Fraport AG (Germany)


• Airport Associates (Iceland)


• Qatar Aviation Services (Qatar)


• AirPart GmbH (Germany)


• Havas Ground Handling Co. (Turkey)


• DAL Global Services, LLC (The U.S.)

KEY INDUSTRY DEVELOPMENTS:

• February 2021 – Dnata announced its partnership with Beta Trans to provide a full range of cargo services to customers at Milan Malpensa Airport (MXP).


• December 2020 – Dnata, a leading air services provider, announced that it adopted the ultraviolet (UV) technology to deliver the highest level of safety and value for airline customers and provide travelers with confidence and peace of mind throughout the entire journey.


• November 2020 – Lima Airport Partners, a part of Fraport AG announced that the company has signed a USD 450 million financing agreement for its airside development program at Jorge Chávez International Airport in Lima, Peru.


• November 2020 – Dnata partnered up with Emirates to provide home check-in services to the leading international airline passengers. DUBZ, Dnata’s leading baggage technology, and logistics company was providing home check-in services for Emirate airlines.

REPORT COVERAGE

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The report provides a detailed analysis of the market and focuses on key aspects such as services type, airport type, infrastructure type, and key players. Moreover, the market research report offers insights on airport ground and cargo handling services trends, competitive landscape, market competition, product pricing, market status, and highlights key industry developments. In addition to the factors mentioned above, it encompasses several direct and indirect factors that have contributed to the sizing of the global market over recent years.

Report Scope & Segmentation