Airport Ground Handling Market

Global Airport Ground Handling Market Forecast

• The nearly US$38.2 Bn airport ground handling market size (as of 2022) to reach approximately US$69.8 Bn by 2030-end
• Market valuation slated to see strong rise between 2023 and 2030, at a CAGR of 8.5%

Quick Report Digest

1. Green initiatives taken by airport operators are anticipated to be the primary driver for airport ground handling market growth. During the forecast period, the construction of new airports, expansion of existing airports to expand passenger and cargo handling capacity, and privatisation of airports are projected to fuel the growth of the market.
2. The increased demand for airport ground and cargo handling services around the world is also contributing to market growth. As per the International Air Transport Association, the count of passengers will reach 8.2 billion by 2037. As a result, providing effective and efficient ground and freight handling is critical.
3. In terms of market share, the passenger handling category currently dominates the global airport ground, followed by the cargo handling services market. Because of the increased emphasis on passenger comfort and security, the segment is likely to grow further. Passenger services enable a seamless flow of passengers from first check-in through boarding.
4. In 2022, the domestic airport hold the largest market share and growth. Increased development in business, tourism, and other sectors is likely to promote segment growth as domestic flights increase.
5. The independent service providers exhibited the largest share of the airport ground handling market owing to the chain of services offered such as baggage handling, cargo handling, and others to various airlines.
6. To boost their market position, major corporations are implementing techniques such as contracts. Menzies Aviation, for example, received a contract from Airports de Montreal, a Canadian international airport, in February 2023. Menzies Aviation is planned to perform its full allotment of services under this contract until the contract expires in December 2030. These services will include ramp, passenger, and cabin cleaning.
7. In 2022, the North American airport ground handling market dominated across the globe. This expansion is attributed to the presence of numerous large airports, a growing aviation sector, and increased airport upgrade spending.
8. The Asia-Pacific region is expected to capture the fastest CAGR growth in the global airport ground handling market, as the region is heavily investing in airport infrastructure development, including the establishment of the latest airports as well as the extension of existing airports.

A Look Back and a Look Forward - Comparative Analysis

Airports' current initiatives to reduce their carbon footprint have hastened the introduction of electric ground handling equipment and the integration of modern technology like automation systems for ramp and cargo handling operations. Airport operators' green initiatives are projected to accelerate market growth over the forecast period.

The market witnessed staggered growth during the historical period 2018 - 2022. This is because of the growth in infrastructural development to accommodate loads of passengers and enhance efficiency. For instance, the China State Building Engineering Corporation (CSCEC) stated in April 2022 that the building of Nasiriyah International Airport, located in Nasiriyah City in the Southern Dhi Qar Governorate, will begin.

During the forecast period, the airport ground handling market is anticipated to grow owing to the construction of new airports, expansion of existing airports to boost passenger and cargo handling capacities, and privatisation of airports.

Key Growth Determinants

• Rising Air Traffic

As the economy increases, so does disposable income for business and pleasure air travel. This has raised air travel demand and led to an increase in air travel. Furthermore, as the global economy becomes more interconnected, there is an increase in foreign travel, which contributes to the growth of air travel.

For instance, the International Air Transport Association (IATA) declared in April 2023 that demand for air travel continues to rise strongly, based on traffic data from February 2023 onwards.

Furthermore, low-cost airlines have seen exponential expansion around the world as a result of increased economic activity, the convenience of travel, growth in the travel and tourist sector, growing urbanisation, and consumers' choice for low-cost service as well as non-stop and frequent service.

• Emphasis on Airport Infrastructure Modernisation

Airports are building and expanding new infrastructure to accommodate increased passenger loads and improve efficiency. For instance, the China State Building Engineering Corporation (CSCEC) stated in April 2022 that the building of Nasiriyah International Airport, located in Nasiriyah City in the Southern Dhi Qar Governorate, will begin.

Airports are also investing in modernisation initiatives to give a more smooth travel experience. For example, under the Eastern Airport City master plan, Bangkok announced an $8.82 billion investment in January 2023 to modernise U-Tapao airport (UTP).

Airports will need additional ground handling services as they expand and modernise their infrastructure to suit increasing passenger loads and operational needs. As a result, this presents chances for market participants, which is likely to boost market expansion.

• Rising Globalisation

Global air traffic has expanded considerably as a result of greater globalisation, emphasizing the need for airport ground support activities. Air travel has grown in popularity as a result of lower airfares, expanding aircraft fleets, improved facilities, and luxury. This has accelerated the rise of ground support services, which are critical to providing passengers with the convenience of flying.

Because of the growing number of operational airports and flights around the world, the business offers significant prospects for future growth. Furthermore, the rise in per capita income and improved standards of living is bolstering the airport ground handling market’s growth during the forecasted period

Major Growth Barriers

• High Capital Expenditure

Airport ground handling necessitates major financial investment to obtain essential equipment and infrastructure, such as aircraft towing tractors, luggage handling systems, and ground support equipment.

The high capital cost of airport ground handling comprises a significant investment required to get the necessary equipment, infrastructure, and personnel to deliver airport ground handling services. As a result, the overall high capital cost of ground handling is likely to stymie market expansion.

• Government Restrictions

To ensure maximum safety & and security of the passengers, cargo, and aircraft operations, airport ground handling is subject to severe regulations.

The expansion of the airport ground handling sector is hampered by stringent regulations, as meeting safety and security standards can be costly and time-consuming. These regulations may be issued by a range of organisations, including government agencies, airport management, and airlines.

Key Trends and Opportunities to Look at

1. Technology Intervention

Airport and airline operators around the world are progressively utilizing advanced technologies to streamline all aspects of GH operations. Airports have a wealth of choices to improve this part of airport operations which is under severe examination due to regular advances in robots, digital communications, and other creative technologies.

Airports around the world are transitioning from fuel-burning ground movements to electric propulsion whenever possible. Several airline GH service providers are creating electric and biogas-powered towing vehicles for airplanes, allowing engines to remain powered off until the aircraft reaches the runway's head. Thus, the growing inclination toward the latest technologies is expected to pose lucrative opportunities.

2. Increasing Digitisation and Sustainability

With the predicted increase in air travel passenger demand and the new aircraft that will join the skies during this time, airports will be pushed for space and clean air, and will likely become noisier.

Digitalisation and automation are driving process improvements, which are crucial for boosting both sustainability and efficiency. It is the solution to problems caused by inadequate airport capacity and congestion, and the aviation industry is accelerating it, particularly in ground operations.

Furthermore, next-generation batteries and alternative green fuels are already contributing to the net zero commitment. Control systems are becoming more precise as technology advances, allowing for more autonomous operations.

3. Standardisation

Across a rising complex as well as competitive air transport cargo and ground handling sector, standardisation may be the key to unlocking your company's utmost caliber. Industry standards reduce cost and complexity by simplifying common processes. They enable airlines to collaborate smoothly with one another as well as with other stakeholders such as airports, ground service providers, cargo agencies, freight forwarders, and governments.

The IATA Ground Operations Manual (IGOM) Portal and the IATA Safety Audit for Ground Operations (ISAGO) are successfully promoting increased standardisation of ground handling systems around the world, according to IATA. This is especially critical as COVID-19 limits are relaxed and operations can ramp up quickly.

How Does the Regulatory Scenario Shape this Industry?

The demand for new airports in major countries is likely to rise as air travel across developing countries like India, and China continues to rise. Increased government investment and refurbishment of older airports are expected to boost growth in the airport ground and cargo handling services industry.

In the coming years, the development of new airports and the refurbishment of existing airports will improve the customer experience. Privatised airports in India and Brazil are two examples where governments prioritised airport growth and service quality improvement.

In India, the results have been dramatic in terms of improved passenger experience, though it is worth noting that aeronautical charges have risen significantly, which is thought to explain, along with airline discontent and subsequent lobbying, why the momentum towards further privatisation in India has slowed.

Fairfield’s Ranking Board

Top Segments

1. Passenger Handling Category Dominant

Passenger handling in the airport ground handling market includes services such as check-in, boarding, luggage handling, and passenger assistance during their journey. Self-service technology usage, increased passenger experience through personalised offerings, and the deployment of contactless processes to ensure a seamless and efficient travel experience are all trends.

In the airport ground handling market, cargo handling entails the effective loading, unloading, and transportation of cargo shipments. The adoption of advanced tracking technology, specialised handling for perishable commodities and pharmaceuticals, and integration of digital platforms to improve supply chain visibility and optimise cargo operations are among the trends.

2. Domestic Airports Lead in Adoption

Domestic airports were the market's dominant segment. Domestic airport developments include the use of new technology such as automation and digitalisation to streamline operations and improve efficiency. Passenger convenience is also becoming more important, with self-service check-in kiosks and automated baggage handling systems becoming more common. Domestic airport ground handling services prioritise rapid turnaround times, effective luggage handling, and smooth passenger transfers.

The international airport segment has the highest CAGR. For seamless passenger processing, advanced technology such as biometrics and facial recognition are increasingly being deployed. Furthermore, there is a rising emphasis on international aviation standards and environmental practices, such as the usage of electric ground support equipment and energy-efficient systems.

3. Independent Segment by Provider to be the Leading Category

Independent service providers controlled the Airport Ground Handling Market. They provide ground handling services to a variety of airlines and airports. They are self-contained and provide passenger handling, baggage handling, ramp services, and cargo handling. Specialised services, technological usage, and an emphasis on sustainability are all trends.

Airlines and airports will be the fastest-growing segment in 2022. They have their ground transportation departments. They handle passenger services, baggage handling, ramp services, and other responsibilities. Trends include operational efficiency, technological use, and third-party provider outsourcing.

Regional Frontrunners

North America Accounts for the Largest Revenue Share

In 2022, the North American region accounted for the largest revenue share in the airport ground handling market. This expansion is attributed to the presence of multiple large airports, the expanding aviation sector, rise in spending for airport infrastructural upgrades.

In addition, the high adoption of smart technologies, increasing focus on improving passenger’s overall experience, and rising emphasis on sustainable business practices are expediting the regional expansion.

Furthermore, Swissport International AG, dnata, and Worldwide Flight Services (WFS) are some of the market leaders in this region, with substantial service offerings and strong customer relationships.

Asia Pacific Grows Highly Lucrative

Due to a growth in the number of airlines and passengers, the Asia Pacific area has seen a considerable increase in air travel. This expansion has raised the region's demand for airport ground handling.

The Asia Pacific region is heavily investing in airport infrastructure development, including the construction of new airports and the expansion of existing airports. As a result, the demand for ground-handling services has expanded to support the growth of air travel.

The rising aviation sector, infrastructure development, and outsourcing tendencies increased demand for airport ground handling services in the Asia Pacific region, which is likely to accelerate the market's growth.

Fairfield’s Competitive Landscape Analysis

The global airport ground handling market is a consolidated market with fewer major players present across the globe. The key players are introducing new products as well as working on the distribution channels to enhance their worldwide presence. Moreover, Fairfield Market Research is expecting the market to witness more consolidation over the coming years.

Who are the Leaders in the Global Airport Ground Handling Market?

• Menzies Aviation Limited
• LAS Goldair Handling
• The Emirates Group
• AOT Ground Aviation Services Co., Ltd.
• Flughafen München GmbH
• Fraport AG
• Aviapartner
• Swissport International AG
• SATS Ltd.
• Celebia Aviation
• Qatar Airways
• Dnata
• Havas Ground Handling Co.
• LAS Goldair Handling
• A-ICE
• Others

Significant Company Developments

Mergers and Acquisitions

• July 2023: Hito Communications, a Japanese human resources provider, announced the acquisition of FMG Group (Flight Management Group), a Japanese corporation focused on aircraft maintenance, airport ground operations, and passenger services.
• April 2023: SATS Ltd. completed its previously announced acquisition of Worldwide Flight Services for €1.3 billion (approximately S$1.8 billion) from an affiliate of Cerberus Capital Management, representing an enterprise value of €2,250 million.

Market Expansion

• September 2023: Menzies Aviation-Siginon Aviation expanded its ground operations to include passenger handling at Nairobi's Jomo Kenyatta International Airport (NBO), the country's largest metropolis and capital.
• April 2023: Tata Group to establish an Air India ground-handling services company to satisfy the airline's expanding in-house requirements while also providing shared services to other carriers. Air India's prior ground-handling subsidiary, Air India Air Transport Services (AIASL), could potentially be relocated as part of the proposal.

An Expert’s Eye

Demand and Future Growth

According to Fairfield's Analysis, the worldwide airport ground handling industry would develop due to the globalisation of air travel and an increase in air traffic. Furthermore, collaborations, acquisitions, and mergers among airport ground-handling businesses have increased.

For example, in April 2023, SATS Ltd paid US$1.3 Bn for Worldwide Flight Services (WFS), a global provider of air freight logistics services. WFS CEO Craig Smyth remarked in a press release that mergers and acquisitions can help organisations create partnerships and enter new markets by merging operations and strengths.

Supply Side of the Market

Companies compete in the market through a variety of techniques, including product innovation, mergers and acquisitions, and alliances. Swissport International AG, for example, formed a strategic alliance with Collinson, a worldwide traveler experiences and medical support firm, in 2021. This collaboration intended to improve travelers' airport experiences by providing seamless and personalised services such as COVID-19 testing, health certificates, and digital health passports.

Furthermore, various new players have entered the Airport Ground Handling Market, establishing their presence through innovation and development. These new entrants concentrate on sophisticated technological solutions, such as automation, robots, and digital platforms, to improve operational efficiency and customer experience. They also place a premium on sustainability, employing environmentally friendly practices and green projects.

Global Airport Ground Handling Market is Segmented as Below:

By Service:

• Passenger Handling
• Cargo Handling
• Ramp Handling
• Others

By Airport:

• Domestic
• International

By Provider:

• Independent
• Airlines and Airports

By Geographic Coverage:

• North America 
  • U.S. 
  • Canada 
• Europe 
  • Germany
  • U.K.
  • France
  • Italy
  • Turkey
  • Russia
  • Rest of Europe 
• Asia Pacific 
  • China
  • Japan
  • South Korea
  • India
  • Southeast Asia
  • Rest of Asia Pacific 
• Latin America 
  • Brazil 
  • Mexico 
  • Argentina
  • Rest of Latin America 
• Middle East & Africa  
  • GCC 
  • South Africa
  • Egypt
  • Nigeria
  • Rest of the Middle East & and Africa