Global Airport Infrastructure Analysis

Globally, airports and the aviation industry is on the slow path to recovery. Infrastructure investments in airports and the volume of M&A activity in the sector have suffered under the global economic downturn. Regulation, passenger traffic and cargo volumes have affected operating costs, which in turn have a domino effect on investment. In the past year airport investments, especially in Greenfield and Brownfield, were negatively affected by cost increases and capital expenditure cutbacks. In addition, governments’ attention, especially in Europe, have been focused on shoring up public finances and reviving domestic economies, resulting in a greater degree of inertia for investment. Although growth stagnated in Europe, there are still opportunities in the emerging markets, albeit in smaller volume, where economies are still growing and demand for air travel continues to expand. Cost remains a key component for the viability of airport infrastructure: according to the Annual World Airport Traffic Report by ACI, in the past year capital investment plans across many airports were slashed for yet another year. Growing competition creates better prospects for many of today’s mid-size airports in the mid-term, while more M&A activity and consolidation of assets, both in terms of buying stakes in individual airports as well as airport groups, is expected in the coming months.

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