A recovery in air travel and new deliveries of aircraft will increase the need for airports.
Los Angeles, CA (PRWEB) February 25, 2012
The US Airport Operations industry has benefited from the recovery of air transportation industries over the last five years. Investment in airports has increased; higher passenger numbers from 2007 to 2008 helped the industry reach revenue of $7.6 billion in 2008. Despite improving conditions in the four years prior, revenue took a significant hit during the recession. Airport operators experienced a decline of 14.4% in revenue in 2009 because of falling demand from major airlines and lower passenger numbers. During 2010, industry revenue grew 0.1%. IBISWorld industry analyst Nima Samadi says, “Even though travel demand rose, demand from airlines remained muted and port operators kept charges low.” The industry is expected to charge ahead in 2012 as revenue grows to $7.0 billion due to an increase in demand for air travel. Over the five years to 2012, IBISWorld estimates that revenue will fall at an annualized rate of 0.6%.
During 2009, the Airport Operations industry experienced a reversal of fortunes, with many of the gains made from 2007 to 2008 coming undone. Major airlines announced capacity cuts, most of which remained in force in 2010. Higher fuel costs and slowing demand initially were the main drivers behind this decision; however, the receding economy has taken over as the major driver for capacity reductions. The recovery from these setbacks occurred from mid-2011 onward. Demand for air travel has recovered strongly, while new aircraft deliveries have and will continue to increase the need for infrastructure developments, says Samadi. The number of industry establishments is expected to fall over the five years to 2012, and the number of employees will fall. This trend will be due to recession-related cuts.
The industry has a medium level of concentration. The four major players are The Port Authority of New York and New Jersey, BBA Aviation PLC, the City of Los Angeles and the Chicago Airport System. Concentration has remained relatively constant over the past five years, with operators continuing to struggle to gain larger market share. New players coming into the industry will be minimal, but airports are increasingly becoming larger to cater to the increasing demand for air travel. Some state-owned airports have already formed public-private partnership agreements and IBISWorld expects that this trend will increase in the future as operators seek additional capital to expand their operations. For more information, visit IBISWorld’s Airport Operations in the US industry page.
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IBISWorld industry Report Key Topics
The industry includes businesses that operate international, national or civil airports or public flying fields. It also includes operators that support airports (except special food-services contractors), offering aircraft refueling, aircraft parking, hangar space rental, air traffic control services, baggage handling services, cargo handling services and others. A fixed base operator (FBO) commonly provides these services.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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