Airports in Europe are postponing expansion projects in response to the economic downturn, but ACI Europe is warning that this will only exacerbate the expected capacity crunch on the ground when traffic growth returns.

In an interview with Airline Business, ACI Europe director general Olivier Jankovec said "all non-urgent investment is being postponed", but added that while the picture is gloomy at the present time, things are likely to improve in 2010.

"2009 will be an annus horribilus for aviation and 2010 won't be great either. But at the end of 2010 we expect to go back into growth mode and by 2010-2025 I still think traffic will double," says Jankovec. "Whatever can be delayed is being delayed, but we still need to be ready for when traffic returns. This is a very difficult equation for airports to solve."


Pointing to a recent report from Eurocontrol, Jankovec says that, based on existing plans, airport capacity will expand by 41% by 2020-2025, but "when we look at the evolution of traffic demand this will double by the same date, so there won't be enough airport capacity to accommodate demand". Eurocontrol predicts that 11% of demand will not be accommodated, and 20 European airports will be as congested as London Heathrow by 2030.

Jankovec says that because the outlook for the next 20 years is "quite positive", it is important for airports "to make good decisions even in bad times". He adds: "Our members are aware that they need to balance their response - they need to assist customers and be very responsive in trying to safeguard existing routes, but they need to be ready to accommodate traffic when it bounces back."

Part of the problem in securing the necessary funds for airport expansion projects, says Jankovec, is that airlines tend to be much more heavily focused on the short-term than airports, which take a longer-term view. "These are two business models that are totally different, but airlines are realising that there will be an airport capacity crunch," he notes. When it comes to airport charges, Jankovec says airports "have to be responsive to the difficulties faced by airlines", but he points out that airport commercial revenues are also suffering due to declining traffic. "Retail revenue became flat in the first semester of 2008. In November, 85% of our membership saw passenger numbers declining and we expect this to go much further down in January. Week after week our members are revising their numbers downwards."

ACI has been pushing the European Union to put the looming airport capacity crunch on its radar, and Jankovec is pleased to see that a fourth pillar has since been added to the Single European Sky initiative to take account of the problem.

"The fourth pillar is all about managing capacity on the ground and it states that we need to align air traffic management with airport capacity directives," he says. "This is a new position for the European Commission and it's very encouraging."

Click here for more on the possible impact of the financial squeeze on airport infrastructure developments

Click here to read our recent feature looking at whether airlines and airports are coming any closer together on the issue of airport charges.

Source: Airline Business