Increased air travel and new aircraft deliveries will boost demand for airport operators
Los Angeles, CA (PRWEB) September 15, 2012
The Airport Operations industry has benefited from the recovery of air transportation industries over the past 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 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 and 2011, industry revenue grew 0.1% and 3.3%, respectively. According to IBISWorld industry analyst Nima Samadi, “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 an estimated 4.4% to $7.0 billion due to an increase in demand for air travel. Over the five years to 2012, IBISWorld expects revenue to fall at an annualized rate of 0.6%.
During 2009, the Airport Operations industry experienced a downward 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 were the initial main drivers behind this decision; however, the receding economy took over as the major driver for capacity reductions. The recovery from these setbacks began in mid-2011 and is continuing through 2012. Over the five years to 2012, the number of industry establishments is expected to fall at an annualized rate of 0.4% to 1,713, while the number of employees is anticipated to fall at an annualized rate of 3.0% to 62,524. “Recession-related cuts have squeezed the profitability of air travel-related industries, prompting the need for these staffing cutbacks,” says Samadi. Over the period, wages are anticipated to decline at an average annual rate of 2.2% to $1.9 billion, with each employee earning an average of $30,686 in 2012.
IBISWorld anticipates that the level of industry concentration will be stable during the next five years. The number of new players entering the industry will be minimal, but airports are increasingly becoming larger to cater to rising demand for air travel, including major players BBA Aviation PLC, City of Los Angeles and Macquarie Infrastructure Company LLC. Some state-owned airports have already formed public-private partnership agreements, and this practice is expected to increase in the future as they seek additional capital to expand their operations. Over the five years to 2017, IBISWorld forecasts that industry revenue will grow steadily. Demand for air travel has recovered strongly, while new aircraft deliveries have and will continue to increase the need for infrastructure developments. For more information, visit IBISWorld’s Airport Operations in the US industry report 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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