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19-Sep-2017 11:55 AM

Airports Council International: Animal spirits unleashed – Aviation grows in spite of the looming ba

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18-Sep-2017 Animal spirits unleashed - Aviation grows in spite of the looming backdrop of protectionism and policy uncertainty

Airports Council International (ACI) releases the latest edition of the World Airport Traffic Report. With comprehensive data coverage for over 2,400 airports in 175 countries worldwide, ACI's flagship publication remains the authoritative source and industry reference for the latest airport traffic trends, rankings and data rankings on air transport demand.

"The dynamic nature of our industry makes it an absolute necessity to have a reliable data source to count on for effective decision making, planning and policy making," said Angela Gittens, Director General, ACI World. "The World Airport Traffic Report delivers an exhaustive review of airport traffic data and analyses in an internationally comparable format to provide both a global view of air transport demand as well as insights into detailed market segments."

Passenger traffic - The irrepressible traveler

Air transport demand continues to march to the beat of its own drum, posting growth rates in excess of 6%. International travel and tourism in particular, remains irrepressible, considering the geopolitical risks that persisted in certain parts of the world. There is a growing disconnect between global gross domestic product (GDP) growth levels, which have remained modest after 2011, and passenger traffic growth, which continues to be robust year after year. Many of the factors behind this are microeconomic in nature and directly related to industry dynamics. On a year to date basis, passenger traffic jumped 6.6% for the first half of 2017 and will undoubtedly exceed the 8 billion mark in 2017.

Air cargo - Animal spirits unleashed

Air cargo markets experienced a revival in the second half of 2016 to surpass 110 million metric tonnes by the end of the year and achieving growth of 4%. Despite the backdrop of economic uncertainty regarding trade policies in the United States and the United Kingdom, two of the world's largest aviation markets, business confidence has persevered into 2017. International trade continued to make gains on the cyclical recovery in the global economy, which translated into growth in air freight volumes. Inventory build-ups, augmented export orders and a strengthening of consumer demand reflected in increased online purchases are important drivers in the near-term. On a year to date basis, air freight volumes (excluding mail), point to estimates of an astounding increase of over 8% in volumes for the first half of 2017.

"When we look at the traffic data over the last two decades, we get a sense that aviation has entered a new era of unprecedented growth," continued Gittens. "Historically low jet fuel prices, affordable air travel through the widespread adoption of the low-cost carrier business model on many short- and medium-haul routes have acted as catalysts in stimulating air transport demand. Moreover, rapid urbanization, especially in major emerging markets, coupled with the intensification of competition within the air transport value chain continue to re-shape the industry landscape to the ultimate benefit of the end-user-the passenger."

Outlook 2017-2018

ACI forecasts reveal that passenger traffic will continue to rise rapidly in the short-term, based on a projected compounded annual growth rate (CAGR) of 6.5% per annum, with global traffic set to surpass the 8 billion passenger mark in 2017. Domestic traffic will continue to climb steadily over the next two years-especially in the Asia-Pacific, European and North American regions-achieving a global CAGR of 5.3%. Despite the recent resurrection of domestic passenger traffic, gains will come primarily from international traffic, featuring a two-year CAGR of 8.4%.

Air cargo, following on its surge in the latter half of 2016 and into 2017, will continue to rise at rates averaging 7.4% worldwide. Over a two year period, this growth will add up to an estimated 16.9 million additional tonnes by December 2018, of which almost 50% will be handled by the Asia-Pacific region, increasing the region's total market share to just above 39%.

Notwithstanding, the industry must be cognizant of the fact that there are several impediments that could curtail the continued rise in demand. Specifically, these are related to geo-political unrest, terrorism and threats to security in certain parts of the world. Physical capacity considerations and potential bottlenecks in air transport infrastructure also pose challenges in accommodating future air transport demand. Finally, protectionist policies that retreat from further economic integration and air transport liberalization could have adverse contractionary effect on the air transport industry.

"In this new era of geopolitical strife and terror, coupled with the wave of protectionist rhetoric that has swept many major economies, clear downside risks have revealed themselves as we end 2017 and approach 2018. Even with the prevailing strength in consumer confidence across major economies and relatively sound economic fundamentals as our backdrop, cautious optimism should be the prevailing sentiment in our industry," Gittens concluded.

Stay tuned for the upcoming release of the ACI World Airport Traffic Forecasts (WATF), which is disseminated in a standard EXCEL format. Both absolute figures and compounded annual growth rates are presented over three time horizons which include short-, medium- and long-term over the 2017-2040 period. In addition to global forecasts, regional forecasts are presented by region and for over 100 countries.

Key statistics in brief

Passenger traffic:

  • Worldwide airport passenger numbers increased 6.5% in 2016 to almost 7.7 billion, registering increases in all regions except Africa, which had a slight decrease of 0.4% due to the region's 1.7% decrease in international passenger.
  • During 2016, the highest number of passengers traveled through airports in the Asia-Pacific region:
  1. Asia-Pacific (2.73 billion, up 10.6% over 2015)
  2. Europe (2.04 billion, up 5.2% over 2015)
  3. North America (1.79 billion, up 3.8% over 2015)
  4. Latin America-Caribbean (588 million, up 1.2% over 2015)
  5. Middle East (369 million, up 9.4% over 2015)
  6. Africa (182 million, down 0.4% over 2015)
  • Atlanta (ATL) remains the busiest airport on the globe with 104 million passengers in 2016. Traffic was up 5% over 2015 at Beijing (PEK) with 94 million passengers, maintaining second in world ranking. Third ranked airport, Dubai (DXB), also stayed in the same position as 2015 with 84 million passengers despite an impressive 7.2% growth throughout the year.
  • The world's fastest-growing airports with over 15 million passengers are:
  1. Bangalore (BLR) (22.2 million, up 22.5% over 2015)
  2. Hoh Chi Minh (SGN) (32.5 million, up 22.4% over 2015)
  3. New Delhi (DEL) (55.6 million, up 21% over 2015)
  • Dubai (DXB) is still the third busiest airport in the world in overall passenger traffic, and has widened its leading position as the world's busiest in terms of international passenger traffic ahead of London-Heathrow (LHR) throughout 2016.
  • Shanghai (PVG) remains one of the fastest growing airports among the world's top 20 airports for passenger traffic, moving from 13th to 9th place and growing 9.8%. Los Angeles (LAX) also had a high growth rate of 8%, moving from 7th to 4th rank in terms of total passenger traffic in 2016.
  • The world's busiest airports in international passenger traffic are:
  1. Dubai (DXB) (83.1 million, up 7.3% over 2015)
  2. London-Heathrow (LHR) (71 million, up 1.7% over 2015)
  3. Hong Kong (HKG) (70.1 million, up 3% over 2015)
  • The world's busiest airports in domestic passenger traffic are:
  1. Atlanta (ATL) (92.7 million, up 2.7% over 2015)
  2. Beijing (PEK) (73.8 million, up 3.4% over 2015)
  3. Chicago (ORD) (66.1 million, up 0.4% over 2015)

Air cargo traffic:

  • Worldwide airport cargo increased 4% in 2016 to 110 million metric tonnes, with mixed levels of growth across all six regions.
  • Hong Kong (HKG) and Memphis (MEM) take the first and second ranks respectively for the busiest air cargo airports with 4.6 and 4.3 million metric tonnes in 2016.
  • Airports in the Asia-Pacific region handled the largest amount of air cargo during 2016:
    • Asia-Pacific (43.4 million metric tonnes, up 5.4% over 2015)
    • North America (30.8 million metric tonnes, up 2.4% over 2015)
    • Europe (20.1 million metric tonnes, up 5% over 2015)
    • Middle East (8.8 million metric tonnes, up 2.7% over 2015)
    • Latin America-Caribbean (5.1 million metric tonnes, up 0.9% over 2015)
    • Africa (2.1 million metric tonnes, up 1.3% over 2015)
  • The world's fastest-growing airports handling over 250,000 metric tonnes of air cargo during 2016 are:
  1. Moscow (SVO) (256 thousand metric tonnes, up 28.8% over 2015)
  2. Doha (DOH) (1.76 million metric tonnes, up 20.8% over 2015)
  3. Hanoi (HAN) (566 thousand metric tonnes, up 18.2% over 2015)
  • The world's busiest airports in international freight traffic are:
  1. Hong Kong (HKG) (4.52 million metric tonnes, up 3.2% over 2015)
  2. Incheon (ICN) (2.60 million metric tonnes, up 4.5% over 2015)
  3. Dubai (DXB) (2.59 million metric tonnes, up 3.4% over 2015)
  • The world's busiest airports in domestic freight traffic are:
  1. Memphis (MEM) (3.80 million metric tonnes, down 6.1% over 2015)
  2. Louisville (SDF) (1.91 million metric tonnes, up 3.3% over 2015)
  3. Beijing (PEK) (1.14 million metric tonnes, down 1.2% over 2015)

Aircraft movements:

  • Worldwide aircraft movements increased 2.7% in 2016 to 91.8 million, with mixed levels of growth across all six regions.
  • Atlanta (ATL) retained its position as the busiest airport in terms of aircraft movements, followed by Chicago (ORD) and Los Angeles (LAX).
  • Airports in the North American region recorded the highest number of movements in 2016:
  1. North America (31.2 million, up 1.6% over 2015)
  2. Europe (23.7 million, up 2.1% over 2015)
  3. Asia-Pacific (22.9 million, up 7.5% over 2015)
  4. Latin America-Caribbean (8 million, down 4.1% over 2015)
  5. Africa (3 million, down 1.4% over 2015)
  6. Middle East (2.9 million, up 7.5% over 2015)
  • Top 3 contributors to global aircraft movement growth by country share:
  1. China (People's Republic of China) (660 thousand increase in movements representing a share of 27.6% of the global increase)
  2. United States (510 thousand increase in movements representing a share of 21.3% of the global increase)
  3. India (257 thousand increase in movements representing a share of 10.8% of the global increase)