Frost & Sullivan Research Service   Published: 25 Apr 2006
Airport Privatisation
   Research Overview

This Frost & Sullivan research service titled Airport Privatisation provides a broad understanding of the worldwide airport privatisation process. It also explains the competitive environment of airport companies, their performance and market presence. In this research, Frost & Sullivan's expert analysts thoroughly examine the following markets/applications/technologies: airport privatisation/investment risks/forms of privatisation.

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   Market Sectors

Expert Frost & Sullivan analysts thoroughly examine the following market sectors in this research:

  • Airport privatisation
  • Investment risks
  • Forms of privatisation
   Market Overview

Growing Financial Pressures and Expected Surge in Air Traffic to Result in Enhanced Emphasis on Airport Privatisation Models

Worldwide, budgetary constraints and rising pressure to finance high-priority public services are leading to increasing concerns related to the funding of airport infrastructure. Beset with financing issues and poor efficiency levels, the traditional airport management model is becoming increasingly difficult to sustain, thereby leading to the growing need for privatisation of airports. As a result of a shift in government perceptions, airports are now being recognised as potential profit-making enterprises and opportunities offered by the private sector to finance airport development plans are being considered.

"As governments face several high-priority expenses, significant budget constraints hinder the development of airport infrastructure required to accommodate increasing passenger traffic," says the analyst of this research service. "This will have a positive long-term impact on the airport industry, as privatisation is perceived to improve the management and overall efficiency of airports." Whilst, currently, only 2 per cent of the world’s commercial airports are managed or owned by the private sector, the success achieved by several private investors is likely to underpin the increasing privatisation efforts. The anticipated air traffic growth, combined with the generation of airport revenues in hard currencies that help diminish investment risks, are factors contributing to the attractiveness of the airport industry. Accordingly, privatisation in various forms, such as enterprise partnerships between public owners of airports and private management firms is acquiring greater importance.

Company Partnerships Crucial to Overcome High Entry Barriers

Several international airports across the world, earlier owned and operated by national governments have been privatised to achieve operating efficiency, improved management, better investment decisions and consequently, satisfactory rates of return on the investor’s capital investments. However, despite the huge growth potential of the market, a restricted number of airport companies are likely to benefit due to high entry barriers. "While the ongoing emergence of the global airport management industry offers strong potential, government regulations and high demand for tenders are likely to pose challenges," remarks the analyst. "Hence, companies participating in the tendering process will need to partner with others to gain a competitive edge."

In view of the diverse value chain of the airport industry and investment options in real estate, airport management and business-to-consumer services, investors will need to consider risk profiles, capability portfolios and feasible investment strategies prior to the final investment decision. An understanding of the in-progress deconstruction of the airport value chain is a crucial aspect that will enable investors to position themselves suitably. At the same time, privatisation involves risks that mandate prudent management by public authorities and governments will need to consider several policy issues to safeguard public interest needs.

  Table Of Contents

1. Executive Summary
        1. Introduction to the Research Service
                  1. Potential Economic Benefits of Airport Privatisation
                  2. Airports - An Increasingly Attractive Industry
                  3. Towards Multinational Airports Operators
                  4. Privatisation Process Worldwide
2. Introduction
        1. Introduction to the Research Service
                  1. Definition of Privatisation
        2. Reasons for Privatisation
                  1. Benefits of Airport Privatisation
3. Alternative Models of Private Sector Participation
        1. Introduction to the Research Service
                  1. Introduction
        2. Alternative Models of Airport Ownership and Management
                  1. Public Ownership and Operations
                  2. Public Ownership and Operations with Commercial Orientation
                  3. Regional Ownership and Operations
                  4. Public Ownership with Private Operations
                  5. Private Ownership and Operations
4. Experiences and Calendar for Privatisation
        1. Introduction to the Research Service
                  1. Overview
        2. Full and Partial Privatisation
                  1. Full Privatisation
                  2. Partial Privatisation
        3. Calendar for Privatisations
                  1. Regional Calendar for Privatisations
5. Risk Management and Investor's Concerns
        1. Introduction to the Research Service
                  1. Overview
        2. Sources of Risk
                  1. Overview
        3. Management of Risk
                  1. Overview
        4. Investor's Concerns
                  1. Industry Specifics
6. Economic Performance of Main Privatised Airports
        1. Introduction to the Research Service
                  1. Introduction
        2. Main Airport Companies
                  1. British Airport Authority (BAA)
                  2. Macquarie Airports
                  3. Fraport AG Group
                  4. Copenhagen Airports
                  5. Schiphol Group
                  6. Flughafen Wien AG
                  7. TBI
                  8. HOCHTIEF
7. Public and Private Interests in Privatisation
        1. Public Authorities
                  1. Position of Public Authorities
        2. Public-Private Interests
                  1. Trade-off between Public and Private Interests
        3. Other Parties Interests
                  1. Financial Investors
                  2. Property Developers
                  3. Large Construction Companies
                  4. Airlines
                  5. Airport Concessionaries
8. Raising Funds
        1. Airport Need for Funds
                  1. Overview
        2. Traditional Methods of Raising Funds
                  1. Overview
9. Geographic Analysis
        1. Introduction
                  1. Overview
        2. North America
                  1. Overview
        3. Europe
                  1. Overview
        4. Asia Pacific
                  1. Australia
                  2. Others
        5. Russia
                  1. Overview
        6. Middle East
                  1. Overview
        7. Latin America
                  1. Overview
        8. Africa
                  1. Overview
10. Frost & Sullivan Awards
        1. 2006 Frost & Sullivan Award for Business Development Strategy Leadership
                  1. Award Description
                  2. Research Methodology
                  3. Measurement Criteria
                  4. 2006 Frost & Sullivan Award for Business Development Strategy Leadership

   List of Figures

Chapter 3

  • Privatisation of Airports: Public Private Partnership Schemes (World), 2005

Chapter 6

  • Privatisation of Airports: Business Portfolio (BAA), 2005
  • Privatisation of Airports: Summary of Financial Results (BAA), 2004-2005
  • Privatisation of Airports: Summary of Financial Results (Fraport Group), 2003-2004
  • Privatisation of Airports: Summary of Financial Results (Schiphol Airport), 2000-2004
  • Privatisation of Airports: Summary of Financial Results by Airport Location (TBI), 2004
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