IATA warns Asian aviation growing too fast for region's infrastructure

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Hong Kong Airport, the third-largest in Asia, has reached terminal capacity.
Hong Kong Airport, the third-largest in Asia, has reached terminal capacity. Photo Credit: Shutterstock

SINGAPORE -- Fueled by a rising middle class and a surge in low-cost airlines, the Asia-Pacific region is the fastest-growing aviation market in the world, a trend that is already taxing the region's infrastructure and that IATA projects will continue over the next two decades. 

In 2015, passengers around the world flew 6.5% farther than they did in 2014, while passengers in the Asia-Pacific flew 8.2% more miles.

That growth is straining the aviation infrastructure across the region, leading to expressions of concern from IATA and other industry players that basic air travel components such as runway and gate space, as well as air traffic control networks and the requisite pool of skilled laborers won't keep up with rising demand.

"The situation is dire. Action is needed now," Conrad Clifford, IATA's regional vice president, Asia-Pacific, said in an email last week.

According to IATA's latest 20-year passenger forecast, published last month, the Asia-Pacific region will see 7.2 billion airline passengers in 2035, up from 3.8 billion this year. If that forecast proves accurate, it will be a larger growth in terms of total travelers than the rest of the world combined.

During that same time frame, China is projected to overtake the U.S. as the world's largest aviation market, while India will surpass the U.K. to take the No. 3 spot on that list.

At the World Financial Symposium held here in September, Clifford delivered a speech calling on governments across the region to aggressively plan and build for the aviation market of the future.

Boeing projects a shortage of 248,000 pilots in the Asia-Pacific region over the next 20 years, Clifford reported in a slideshow presented at the symposium, as well as a dearth of 268,000 industry technicians.

Meanwhile, many of the region's largest airports are already pushing capacity limits.

Among those is Beijing Capital. The second-busiest airport in the world behind Atlanta, it reached terminal capacity in 2013 and is expected to max out its runways in 2019, according to a report that the aviation consulting firm Intervistas prepared for IATA.

Hong Kong Airport, the third-largest in Asia, has also reached terminal capacity and was projected to use up all its available runway capacity by the end of this year.

What's more, Intervistas projects that major Indian airports in Mumbai and New Delhi will reach capacity limits in 2018 and 2021, respectively.

Clifford said that inadequate infrastructure is already plaguing air service in several Southeast Asia destinations.

"We have seen flight delays in Singapore, Manila, Jakarta and Bangkok," he wrote in an email. "In addition, delays on the tarmac and in the air result in increased fuel burn and cost for airlines. But in the end, the passenger is the one who suffers due to time wasted, lost productivity and a less-than-desirable experience in congested terminals."

IATA is hardly a voice in the wilderness. At the 2015 annual meeting of the Association of Asia Pacific Airlines, director general Andrew Herdman also voiced concerns about the region's aviation infrastructure. And in an interview last week, Shukor Yusof, owner of the Malaysia- and Singapore-based aviation advisory company Endau Analytics, expressed similar sentiments.

"My view is that the governments -- not just China but also Indonesia and Vietnam -- haven't paid enough attention to, first, creating and building more infrastructure, and second, training people," Yusof said. "They haven't been farsighted enough."

Still, countries throughout the region are not standing idly by. In China, the first section of the Beijing New Airport, which could someday become the world's largest, is slated to open in 2019. What's more, of the 29 Chinese airports that Intervistas said will be capacity-constrained in the next two decades, approximately half have already started planning or building expansions.

A fourth terminal is slated to open at Singapore's Changi Airport in the second half of next year. A third runway is in the works, and a fifth terminal is being planned.

In Bangkok, a passenger terminal in the works at Suvarnabhumi Airport will increase capacity from 45 million passengers per year to 65 million, and Thai authorities are already planning another terminal as well as a runway expansion.

In India, where the aviation market grew by 25% in 2015, the government has plans to build 200 airports over the next 20 years, according to Intervistas, and by 2028, expansions are planned for six of eight airports facing constraint issues.

Efforts to facilitate Asia-Pacific aviation networks are also transcending international borders. China and the U.S., for example, are collaborating on a pilot project designed to improve airspace use at Xianyang Airport in Xi'an in order to reduce flight delays.

Addressing that issue was the No. 1 priority that China's Civil Aviation Administration had for the U.S.-China Aviation Cooperation Program, a bilateral public-private partnership, said Verinda Fike, who oversees China aviation work at the U.S. Trade and Development Agency. 

"They are aware of trade constraints due to airspace," Fike said "And they are very aware that there is a need to increase the efficiencies within their existing airspace."

As part of the Xi'an project, the U.S. is advising Chinese authorities on the best practices to control airspace around the airport.

"The more U.S. airlines have access in China, the more jobs will be created here," Fike said.

Yusof praised the efforts that countries such as Singapore and India are making to keep up with the surging demand for commercial aviation. But he was critical of several others, most notably Indonesia, a country of 250 million people that IATA projects will become one of the world's  10 largest aviation markets in the next two decades.

Jakarta's Soekarno-Hatta Airport recently opened the first portion of a 25 million-passenger-per-year terminal, and, according to Intervistas, expansion plans are in place for Indonesia's one other airport that is currently operating at capacity.

Still, Yusof said, Indonesia needs to develop more airports, come up with a proper long-range blueprint and do more to address aviation safety.

"This is affecting the potential for tourism, for example, and their ability to expand infrastructure in tandem with the growth," he said.

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