World’s airports facing ‘capacity crisis’, industry body warns

The chief executive of the International Air Transport Association (IATA) said a lack of investment by governments meant many nations were turning to more expensive, privatised airports to improve services and open new markets.

The body, which represents 280 carriers, said while demand for air travel was growing it forecast profits would be squeezed this year – largely because of rising oil prices.

Its previous estimate of combined profitability for 2018 was cut by 11%, despite a projected increase of 6.5% in passenger traffic.

IATA said that trade wars were another risk factor at a time of continuing Brexit uncertainty for European carriers.

But its chief executive, Alexandre de Juniac, told the organisation’s annual meeting in Sydney that a focus on the future was important to ensure supply meets demand.

“We are in a capacity crisis and we don’t see the required airport infrastructure investment to solve it.”

On the growing trend of private money, he added it had: “not lived up to airline expectations” with many airlines having “far too many bitter experiences”.

“Travellers also sense the problem. According to (global rating system) Skytrax, five of the top six traveller-preferred airports are public,” he said.

“Privatised airports are definitely more expensive. But there is little difference in efficiency or investment levels compared to airports in public hands.”

Airlines have been among the biggest critics of Heathrow’s plans for a third runway – with British Airways’ owner IAG being the most vocal.

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IAG’s chief executive Willie Walsh claims the current plans will mean passengers footing the bill for the work through higher charges at the UK’s largest airport.

He has also demanded its private sector owner’s “monopoly” on airport infrastructure, such as terminals, is ended to boost competition.

Heathrow has accused IAG of attempting to use the expansion to bolster its own domination of the airport’s take off and landing slots.

The Government’s final plans for expansion at the west London hub are due to be released later this year ahead of a final vote by MPs.