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News Article

Airport Capacity Remains 20 Percent Under 2019’s Figures

By Sofía Hanna | Wed, 05/25/2022 - 09:17

Passenger traffic remains one of the woes of the aviation industry. In 2020, COVID-19 dealt a heavy blow to the sector, leading to a drop of 60 percent in traffic compared to 2019's numbers. To date, levels remain 22 percent below 2019’s results. Because of this, recent decisions made by the Mexican government have been put into question, regarding the management of routes and passenger volumes between AICM and AIFA.

 

According to the most recent air transport report from the International Civil Aviation Organization (ICAO), COVID-19 left the aviation industry with a loss of 2.703 billion passengers in 2020, which represents a drop of 60 percent compared to 2019. This type of decline in the sector led to numbers that were only reached in 2003, taking into account the Severe Acute Respiratory Syndrome (SARS) crisis. This, in economic terms, has cost airlines approximately US$372 billion in gross operating income. Taking into account the current context in which the sector finds itself, ICAO forecasts that by the end of 2022, total world passenger traffic will still be between 19 percent and 22 percent below what was recorded in 2019. This means that it would still be necessary to recover between 1,123 and 1,292 million passengers to reach pre-pandemic figures.

Airports Council International (ACI) has stated that “although all non-aeronautical sources declined in 2020 compared with 2019, those directly affected by passenger volume suffered the most, such as retail concessions at -65.2 percent.” The airport industry remains asset-intensive. Although total airport costs dropped, costs on a per-passenger basis increased to 91.8 percent due to passenger traffic plummeting compared to a fixed cost base.  

 

Based on these figures, there have been disagreements in Mexico as airlines and cargo agencies must change their strategies toward the new AIFA airport, which would imply an increase in costs that would threaten various business models based on sustainability and budget efficiency. Currently, AICM is still 20 percent below pre-COVID-19 passenger numbers. “Invoking saturation as an argument to bring airlines to AIFA is not valid,” comments Frank Nozinsky, Director of Commercial Sales for Mexico, Colombia, Ecuador, and Central America and the Caribbean, Lufthansa Cargo and LCSLM Mexico, in an interview with Forbes Mexico. “Moving our operations would mean that for the same packages that we handle today, we would have to operate two warehouses and sometimes put trucks on the street, which are already saturated. All this increases cost and complexity.”

 

These sorts of issues are meant to be handled by a new coordination table, which includes the Ministry of Infrastructure, Communications and Transportation (SICT), the Ministry of National Defense (SEDENA) and the Mexican Navy (SEMAR), along with the directors of Aeroméxico, Volaris and Viva Aerobús. This team is working toward improving aviation in Mexico, as previously reported by MBN

 

The data used in this article was sourced from:  
Forbes, MBN, ICAO, ACI
Photo by:   Tusik Only, Unsplash
Sofía Hanna Sofía Hanna Journalist and Industry Analyst