Airport Services Market Size, Share & COVID-19 Impact Analysis, By Airport Type (International and Domestic), By Application (Aeronautical Services and Non-Aeronautical Services), By Infrastructure Type (Greenfield Airport and Brownfield Airport), and Regional Forecast, 2022-2029

The global airport services market size was valued at USD 89.87 billion in 2021 and is projected to grow from USD 97.87 billion in 2022 to USD 290.23 billion by 2029, exhibiting a CAGR of 16.80% during the forecast period. The global COVID-19 pandemic has been unprecedented and staggering, with experiencing lower-than-anticipated demand across all regions compared to pre-pandemic levels. Based on our analysis, the market exhibited a decline of 49.57% in 2020 as compared to 2019.

The airports have commercial relationships with airlines and passengers. They derive their income from two main sources: aeronautical and non-aeronautical services. This industry is promising opportunities in aviation management and logistics services. Developments in the aviation industry have had a profound effect on the market. These business opportunities mainly include passenger handling (customer service functions) and floor management (cargo and cargo/ delivery, flight control, and others). Increased passenger traffic and congestion in developing countries and infrastructure development will drive the market. The significant rise in the number of airports and the refurbishment of existing airport infrastructure is also expected to boost the growth of the airport services market.

The airport usually has paved runways and repair facilities and serves as a passenger and cargo depot. Airport service providers are currently the ones who are currently looking for greater volumes of business and trades associated with ongoing situations such as the modernization of the airport infrastructure. Over the past two decades, airports around the world have tightened security due to emerging threats. Meanwhile, the expected increase in passengers has put pressure on major transportation hubs to tighten traffic, cut lines, and make passenger traffic from the door-to-door exits as continuous as possible. Moreover, the major countries worldwide are investing in bulk to make their airport infrastructure more advanced and user-friendly. For Instance,

• In December 2021, the Airports Authority of India (AAI) announced that they will be spending about USD 3.5 billion over the next five years to expand and modernize existing terminals. The spending is part of several reviving measures undertaken by the Ministry of civil aviation in India to minimize the severe disruptions caused by the COVID-19 pandemic in the year 2020 and 2021.

COVID-19 IMPACT

COVID-19 Pandemic Led to Drastic Decline in Passenger Air Traffic

The recent coronavirus outbreak has had a drastic impact on the aviation and airport services industry. At the depth of the pandemic crisis in April 2020, 66% of international airlines were suspended as governments closed borders or set up isolated settlements. One million jobs were lost with aviation industrial losses this year having reached USD 126 billion. In addition, air connections dropped by more than half in 2020 by 1.8 billion passengers, a decrease of 60.2% compared to the 4.5 billion flights in 2019. The decline in air passengers traffic in 2020 was the largest since global revenue passenger-kilometers (RPKs) started being tracked around 1950. For instance,

• Industry-wide passenger air travel demand (measured in revenue passenger-kilometers, or RPKs) declined by 65.9% compared to the previous year


• International passenger demand (RPKs) dropped by 75.6% compared to 2019


• Domestic air passenger demand (RPKs) declined by 48.8% compared to 2019

The International Air Transport Association (IATA) released the IATA World Air Transport Statistics (WATS) publication with regional-wise performance figures for passenger air traffic during that year of the COVID-19 crisis. For Instance,

• Asia Pacific: 780.7 million passengers, dropped by 53.4% compared to 2019


• North America: 401.7 million passengers, a decline of 60.8% compared to 2019


• Europe: 389.9 million passengers, down by 67.4% compared to 2019


• Latin America: 123.6 million passengers, a decline of 60.6% compared to 2019


• Middle East: 8 million passengers, a decline of 67.6% compared to 2019


• Africa: 34.3 million passengers, down by 65.7% compared to 2019

LATEST TRENDS

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Artificial Intelligence (AI) Technology Powered Modern Airport Services is the New Market Trend

AI is embedded in many areas in the tourism and tourism industry, making life easier for travelers around the world. There are widely used AI methods in airports these days, such as face recognition programs and airport security scanning devices. The aviation sector is witnessing a huge transformation owing to the emergence of AI technology-powered robots and devices at the airport. Over the past two decades, airports around the world have tightened security due to emerging threats. Meanwhile, the expected increase in passengers has put pressure on major transportation hubs to tighten traffic, cut lines, and make passenger traffic from door to door exit as continuous as possible. 

AI and IoT technologies have made it easier for airports around the world and these airports are known as modern airports. These modern airport facilities offer superior convenience and efficiency as a high priority. To keep the airport hassle-free various airport service providers are employed to enhance passenger experience at the airports. Airports are likely to invest in making smart airports by the adoption of advanced automated technologies at airports to deal with the various operational challenges. Many airports have started employing autonomous robots driven by artificial intelligence and machine learning. For Instance,

• In July 2021, Robotic Assistance Devices Inc. (RAD) announced it received a 6-unit order of ROSA180 from the U.S. airport authority. ROSA180 (Responsive Observation Security Agent) is a compact, self-contained, security, and communication solution that can be deployed in about 15 minutes. Similar to other RAD solutions, it only requires power as it includes all necessary communications hardware.

DRIVING FACTORS

Growing Low-Cost Airline Operators Around the World to Fuel the Growth of the Market

The impact of low-cost airlines on the aviation industry has been enormous. These airlines offer low-cost travel tickets compared to other airlines. Over the past few years, these low-cost carriers attracted more travelers and experienced rapid growth worldwide as a result of rising economic activity and urbanization. In addition, increased demand for hassle-free travel and convenience have supported the market growth. The increase in demand for low-cost airlines has led to an increase in the development of cost-effective aviation services that are expected to further market growth. In Asia and the Middle East, the low-cost aviation industry has grown significantly over the past decade and there are no indications that development will slow down in these regions. Thus higher growth numbers are expected during the forecast period. For Instance,

• In India, IndiGo is a low-cost carrier and is the biggest customer of Airbus 320 around the world. IndiGo operates a fleet of 250 aircraft, including 133 Airbus A320neos, 45 A321neos, and 39 A320-200s. Moreover, IndiGo has expanded Its A321neo fleet by about 300% in one year. India’s most affordable and low-cost carrier IndiGo continued to expand its fleet drastically in 2021. The company added 11 new A321neos this year alone. This means that IndiGo's A321 fleet has grown by 300% since the pandemic began in February 2020.

Development of Advanced Airport Infrastructure and Services to Boost the Market Growth

There is a growing need to expand airport infrastructure in smaller cities, thus airports are under continuous development to expand their infrastructure and improve customer experience. Increasing demand for more gates, amenities for longer routes, and more modern air traffic control are expected to further market growth. From component tracking systems to building information modeling, airports are drastically turning to new technologies to facilitate the construction of larger projects. New airport construction projects around the world are developing in an unprecedented way. According to a recent report from Business Wire, the number of projects in the implementation phase reaches USD 377.6 Billion, while those in the planning phase cost USD 215.8 Billion. For Instance,

• In December 2021, Heathrow, Europe’s busiest airport, announced that it aims to have a third runway up and running by 2026. The airport is anticipated to introduce a new pilot component tracking system that will enable attain this goal on schedule. The technology will be developed by Siemens Digital Logistics, the system will track millions of vital and important construction components destined for the site of the new runway in real-time.

RESTRAINING FACTORS

Stringent Government Regulations to Hinder Market Growth

The government or the Ministry of Civil Aviation plays an important role in airport infrastructure and airport-related services. There are times when the government gives relief to the airport service providers but in some scenarios, the stringent government regulations by the airport authority hinder the market growth of the airport and aviation-related market. Airports around the world have a variety of different and targeted governance systems. Variations of management plans for the national airport may be excused due to different local conditions. The current crisis faced by the industry requires more cooperation to help the aviation industry recover. Until recently, the rapidly growing demand for air transport services has created significant demand for new aviation infrastructure, as well as capacity improvements at existing airports, which, in turn, will create a new regulation that might not be in favor of private airport operators. Thus, these factors are expected to hinder the market.

SEGMENTATION

By Airport Type Analysis

Domestic Segment is Estimated to Lead the Global Market

Based on airport type, the market is divided into international and domestic. The domestic airport segment is anticipated to dominate the market, owing to the rise in domestic passenger traffic amid the pandemic. The international airport segment is predicted to be the fastest-growing segment post-pandemic after the worldwide travel restrictions are lifted. Increased travel spending by middle-class people in developing countries is a major factor in the increase in the number of domestic passengers. Demand for domestic airlines is growing due to increased development in business, tourism, and other sectors. The increase in number of domestic air passengers in emerging countries, such as China and India, is expected to enhance the market growth. India has the third-largest domestic aviation market in the world. The need for increased spending on domestic airports and increased passenger traffic is expected to propel the segment growth in the near future.

By Application Analysis

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Aeronautical Services Segment to Hold Largest Airport Services Market Share in the Base Year

Based on application, the market is segmented into aeronautical services and non-aeronautical services. Aeronautical services are further divided into aircraft ground handling services, aircraft maintenance services, and passenger services. Aircraft maintenance services mainly include maintenance actions required to ensure continuous airworthiness of the aircraft or part of the aircraft, including repairs, inspections, replacements, faulty repairs, disclosure changes, compliance with airworthiness directives, and repair. The aircraft maintenance services segment was the largest segment in the base year and is expected to retain its position over the forecast period due to increasing demand for MRO and line maintenance services around the world. Aircraft ground handling services include lavatory cleaning and replenishment, parking service, ramp service, and others. Passenger services include security service, transit service, and others.

The non-aeronautical services mainly include baggage handling services, car rental services, car parking services, food & beverage service, retail service, and others. The non-aeronautical service segment is anticipated to be the fastest-growing segment in the market as the non-aeronautical revenue provides additional aid to the airport service provider during the time of pandemics or economic depressions.

By Infrastructure Type Analysis

Greenfield Airport Segment to Witness Substantial Growth in the Projection Period

Based on infrastructure type, the market is bifurcated into greenfield airport and brownfield airport. With the sudden rise in the number of air passenger traffic and travelers as well as increased airline fleet, airport operators are spending more and are undergoing immense pressure in relation to passenger handling. taking net-zero emissions by 2050. Airport operators around the world have opted for some plans that can help them to construct a suitable and sustainable aviation infrastructure. Greenfield airport is a term used to refer to a new airport, built from scratch in a new location. Such airports are designed to support the perceived needs of existing airport traffic. Greenfield airport is anticipated to witness substantial growth in the market. It is expected to hold its position in the projection period due to the growing demand for internationally benchmarked airports. The brownfield airport market is expected to grow during the forecast period due to the modernization and development of airports.

REGIONAL INSIGHTS

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In terms of geography, the airport services market growth is divided into North America, Europe, Asia Pacific, and the Rest of the World.

North America dominated the market in 2021. The North American market size stood at USD 25.11 billion in 2021. The growth is attributed to the presence of major players such as Air General Inc. and S.A.S. Services Group, Inc. Moreover, the region held the highest number of passenger traffic in the base year after the pandemic hit. Thus, higher growth numbers are anticipated during the forecast period.

The market in Europe is expected to witness significant growth due to the growing airport infrastructure in the U.K., France, and Germany. Moreover, Germany is the hub for major airport service providers including Fraport AG Frankfurt Airport Services Worldwide, Worldwide Flight Services, and LHR airport. These are some prominent service providers in the region and have customers from around the world.

Asia Pacific is expected to be the biggest emerging region in the global market, owing to the sudden rise in air passenger traffic. Air passenger traffic and increasing low-cost carriers in countries such as India and China are encouraging the development and modernization of airport infrastructure and the expansion of new airport numbers of airports in the region. According to the International Air Transport Association (IATA), China’s air passenger traffic will surpass the U.S in 2024. Moreover, India is predicted to be the third-largest aviation market during the forecast period due to the rise in aircraft fleet and increased trend of low-cost carriers in the country.

The rest of the world is also anticipated to witness significant growth in the market owing to the modern advancements in the airports and the increase in tourism and frequency of foreign tourists. Moreover, growing investment by the government for improving the public infrastructure to enhance tourism in the region is anticipated to drive the market in the region.

KEY INDUSTRY PLAYERS

Increased Modernization and Acquisition Route Expansion Strategies to Sustain in the Market

Fraport AG Frankfurt Airport Services Worldwide and LHR Airports Ltd. are some of the major airports in the world. These airport authorities provide a variety of services at their airports. Airport service providers have used strategies such as space expansion and collaboration to compete with competitors. Frankfurt International Airport has the most direct routes in the world as it serves more than 300 destinations on five continents. In addition, airports welcome new strategic alliances and partnerships and enter into long-term contracts with airlines to build long-term relationships with aircraft systems OEMs, airlines, and MROS to continue in the market.

LIST OF KEY COMPANIES PROFILED:

• Beijing Capital International Airport Co. Ltd. (China)


• Fraport AG Frankfurt Airport Services Worldwide (Germany)


• Air General Inc. (U.S.)


• dnata (UAE)


• Worldwide Flight Services (France)


• S.A.S. Services Group, Inc. (U.S.)


• LHR Airports Limited (U.K.)


• Acciona (Spain)


• Signature Aviation plc (U.K.)


• Tokyo International Air Terminal Corporation (Japan)


• Çelebi Aviation (Turkey)


• Airports de Paris SA (France)

KEY INDUSTRY DEVELOPMENTS:

• March 2021 – dnata and Cebu Pacific Air (CEB) have expanded their long-term partnership in the Asia Pacific region. In addition to the past multi-year extension of an existing airport service contract at Sydney Airport (SYD), dnata has made an agreement to provide a range of ground handling services to the airline at Melbourne Airport and Singapore Changi Airport.


• March 2022 – Eve UAM and Acciona announced that they will be working together in strategic partnership for the development of a sustainable Urban Air Mobility ecosystem. Under the terms of the agreement of Eve’s business combination with Zanite Acquisition Corp., Acciona will invest USD 30 million and will join the group of strategic investors that are currently supporting the development of Eve and its business plan.

REPORT COVERAGE

An Infographic Representation of Airport Services Market

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The global airport services market report includes a detailed analysis of the market and focuses on key aspects such as service types, major key players in the market, and different applications of these services. Besides this, the report offers key insights into the market trends and highlights key industry developments with COVID-19 impact analysis. In addition to the factors mentioned earlier, the report encompasses several factors that have contributed to the growth of the market in recent years.

Report Scope & Segmentation