Study: Airport Infrastructure Investment To Fall Short by 2020

AIN Air Transport Perspective » February 4, 2013
Underfunding of airport construction could cost the U.S. $313 billion in gross domestic product by 2020, according to a report commissioned by the ASCE. (Photo: Atlanta Hartsfield International Airport)
Underfunding of airport construction could cost the U.S. $313 billion in gross domestic product by 2020, according to a report commissioned by the ASCE. (Photo: Atlanta Hartsfield International Airport)
February 4, 2013, 1:20 PM

Dire consequences await the U.S. economy in the absence of significantly increased investment in airport infrastructure in the coming years, according to a new report commissioned by the American Society of Civil Engineers (ASCE). The fifth and final report in the ASCE’s Failure to Act series, The Impact of Current Infrastructure Investment on America’s Economic Future, predicts an estimated gap in airport investment between now and 2020 of $39 billion.

Among the 3,300 airports in the U.S. designated by the Federal Aviation Administration as important to the national aviation system, 35 airports in the nation’s top 15 markets account for 80 percent of U.S. passenger origin and destination movements, totaling 343 million trips. The FAA forecasts that enplanements in those 15 markets will increase 30 percent by 2020 and 121 percent by 2040. More important from the perspective of air traffic projections, said the report, commercial aircraft operations will grow by 17 percent through 2020 and 62 percent by 2040, while the 15 major markets will see growth rates of 23 percent and 86 percent during those respective periods.

Air and ground congestion at major airports and regions presents the most significant economic threat to aviation, according to the study. Extending the trend of needs and spending documented by the FAA and Airports Council International shows an annual capital gap of about $2 billion through 2020 (roughly $13 billion in need and $11 billion in expenditures per year) and $1 billion annually from 2021 to 2040 ($12 billion in need and $11 billion in expenditures, assuming that spending through 2020 does not fall lower than recent trends).

Even while considering the congestion relief promised by the estimated $40 billion NextGen project, which involves moving from the current ground-based radar system to a satellite system, a failure to meet construction needs will result in a cumulative effect on the U.S. economy, according to the report. Anticipated growth of aircraft operations and passengers at major airports will lead to delays for cargo movement and business travel, assuming that capital spending remains consistent through 2040, as it has since 2001 (about $10 billion annually in 2010 value). The report estimates the broad effects on the U.S. economy would represent a cumulative loss of GDP amounting to $313 billion by 2020 and $1.52 trillion by 2040, as well as a deficit in job production of some 350,000 over the next seven years.

Tags: Business

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