The number of airports and air travelers increase as airport lounges are set to grow

Author: Nishu February 20, 2022

The number of airports and air travelers increase as airport lounges are set to grow


The number of airport lounges in India is expected to increase from 70 to 90 by the calendar year 2025

The number of airport lounges in India is expected to increase from 70 to 90 by the calendar year 2025

According to a statement by MoCA and Frost & Sullivan Research, the number of airport lounges in India is expected to increase to 70-90 by calendar year 2025, 150-160 by 2030 and 193 by 2040, according to estimates based on FICCI data. Is.

The number of cities in India with more than two airports is expected to be 8, 16 and 31 respectively as of the same time-frame. The number of passengers is expected to increase to 293 million, 567 million and 1114 million respectively.

Industry revenues are also expected to grow to $16.9 billion, $20.8 billion and $28.6 billion, respectively, by these years. The total number of operational airports is expected to reach 295 by 2040. According to a study by Frost & Sullivan, the airport services registered a high growth from ₹ 1,304.97 crore in FY17 to ₹ 1,842.5 crore in FY19.

The growth in FY20 was modest at ₹1,887.74 crore due to the early effects of the pandemic. Buoyed by this growth, airport lounge service providers such as Dreamfolks Services are raising funds through IPOs. Dreamfolks is banking on the fact that non-aeronautical income per passenger which stood at 75.94 in FY17, has more than tripled to ₹250.56 in the pre-pandemic year of FY20. The share of non-aeronautical revenue for private airports like Delhi, Mumbai and Bengaluru varied between 50% and 70% of their total revenue in FY19. However, non-aeronautical revenue from AAI-managed airports stood at around 10%-15% for FY19. According to reports, this is an indicator of how travelers are willing to spend more with better services, and will benefit the lounge market among other retail categories of passenger spending.

“The Indian airport lounge market is on the cusp of manifold growth in terms of value and volume,” said Libertha Kallat, Chairperson and MD, Dreamfolks Services Ltd. The increase in passenger volume is driven by post-pandemic demand. ,

He added, “India will also witness higher growth in airport services as lounges, airlines, tour operators and banks create awareness among customers about personalized, customized and value-added services for air travelers.”

As of 2018, there were seven airports that handled more than 10 million passengers; This is expected to grow to 47 airports by 2040, which presents a significant opportunity with the potential for multiple lounge options at these airports.

As of 2020, there were about 125 operational airports in India, and this is expected to increase to 295 by 2040. The Government of India has planned to spend around ₹1 lakh crore for setting up new airports.
‘Economic Engine’

Every ₹100 to ₹325 invested in aviation is expected to generate economic output. Similarly, every 100 jobs created in aviation are expected to create 610 indirect jobs.

The aviation sector is contributing about 3.5% to India’s GDP, with air travel accounting for about 10% of the population.

The number of lounges in an airport is proportional to the number of passengers it handles. The top 24 global airports average about 7 lounges per airport. According to regulatory filings, Indian airports have an average of 2 lounges per airport.

Only 8% of eligible passengers use this facility to access the lounge, and admission is very low.

Guangzhou International has the most airport lounges in China, at 19, followed by Xian Xianyang International (12). On average, the top 25 international airports have 7 lounges per airport. India’s Indira Gandhi International Airport in New Delhi has 7 lounges, followed by Chhatrapati Shivaji Maharaj International in Mumbai, which has 6 lounges. On an average, the top 25 airports in India have only 2 lounges per airport. The number of lounges in Indian airports is expected to grow at an annual average of 10% between 2021 and 2040.

As of 2021, the number of airport lounges in India is recorded to be 50. Other airports are being planned in Mumbai, Goa, Visakhapatnam and Pune. Navi Mumbai and Mopa airports (in Goa) are under construction.

The airport at Bhogapuram in Andhra Pradesh is currently in the bidding stage. Credit and debit cards with lounge access were estimated to be around 57.20 million in India at the end of calendar 2021. The percentage of passengers using credit and debit cards for lounge access is around 8%, which is expected to increase.

Using all modes of access, the total domestic and international lounge usage is estimated to be around 7.5 million passengers per annum (pre-Covid) FY20, as per the available data.

20 February, 2022, 1:35 am

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