Collectively, the world's airports are swimming. Individually, however, they're sinking. So finds the just-released 19th edition of the "Airport Economics Report," published
today by Airports Council International (ACI).
According to the report, which covers fiscal year 2013, global airport industry revenue reached $131 billion in 2013, up 5.5 percent from 2012.
"In the face of the ongoing uncertainties in the global economy, global airport revenues remained resilient through the downside risks that have persisted across the world's markets," said ACI Director General Angela Gittens.
And yet, as many as 69 percent of airports worldwide operate at a net loss, according to the report.
"While a single measure of global airport profitability provides a good barometer of industry health, it often masks the important nuances and industry facts crucial for evidence-based policy decisions. The challenge remains that most airports in the world are small, with high traffic volumes concentrated in only a handful of airports. Therefore, the airport industry faces a conundrum," said Dr. Rafael Echevarne, ACI's director of economics and program development. "Although the airport industry as a whole is profitable, most airports are actually in the red on their financial statements … Smaller airports have neither sufficient traffic to achieve economies of scale nor to generate significant aeronautical or non-aeronautical revenue."
Although there is no "one-size-fits-all" approach to making airports healthy, ACI urges regulators to consider the massive investments they require. And also the massive returns such investments yield.
"These results have important implications for national regulators involved in the economic oversight function of airports. Given that airports are asset-intensive businesses, they require large investments just to accommodate a single aircraft landing," Echevarne concluded. "Taking this into consideration … each airport has a different set of challenges, opportunities, and circumstances. In turn, with an objective for sustainable development, this should influence how each airport is regulated."