Loading

Fitch: Passenger Traffic Up 15% from Peak Levels for U.S. Airports

Direct News Source

Fitch Ratings-New York-12 February 2018: Passenger traffic for U.S. airports rose last year to their highest levels in over a decade, according to Fitch Ratings in its latest sector briefing.

Enplanements grew an estimated 3.3% in 2017, with Fitch projecting much of the same for 2018 (2.5% to 3%). That said, Fitch's optimism over traffic growth is more guarded than industry forecasts.

"Wildcards for the sector remain federal initiatives, and with a new Federal Reserve Chairman now in place, the future trajectory of interest rates could affect both business and leisure travel," said Senior Director Seth Lehman.

Large hubs again drove much of the growth in passenger traffic, though airports in smaller regional markets will equalize that growth in the coming years. Airline and concession revenues are performing well. However, a lack of increases to federal funding makes airport redevelopment capital still very important, particularly for terminal projects at large hub airports.

What may help with funding for these projects is public-private partnerships (P3s), which are gaining traction among some U.S. airports

"Projects are already underway at Denver Airport while LAX is close to getting work started and Kansas City International and Lambert in St. Louis are in pre-approval stages," said Lehman.

This all bodes well for airport ratings. The Rating Outlook for over 90% of Fitch's 65 rated U.S. airports is Stable. In addition, Fitch upgraded the ratings on eight airports last year.

Fitch's latest U.S. airports sector briefing is available at 'www.fitchratings.com' or by clicking on the above link.

This press release was sourced from Fitch on 12-Feb-2018.