Airport businesses face growth-without-profit risk as global trends push non-aviation revenue

The global airport business is entering a new phase in which rising passenger numbers no longer guarantee stronger profitability, as operators increasingly rely on non-aviation income to support long-term growth and sustainability.

According to the World Economic Forum’s Global Aviation Sustainability Outlook 2026, the latest passenger forecasts from ACI World project global air passenger traffic will reach 10.2 billion people in 2026 before climbing further to 18.8 billion by 2045.

The report said the figures confirmed continued long-term demand growth and reinforced the aviation sector’s role, particularly airports, as critical enablers of trade, travel, tourism and global connectivity.

Airports are no longer viewed simply as transport infrastructure, but as economic anchors and gateways to local communities. They support supply chains, generate employment and maintain links that underpin broader economic activity.

Geopolitical pressures seen as catalyst for transformation

The report also pointed to geopolitical shifts, social change, climate impacts and wider uncertainty as forces accelerating transformation across the aviation industry rather than obstacles to progress.

Building a more resilient, sustainable and innovative aviation sector is therefore being treated not only as an industry priority, but as a global economic necessity.

Data from Statista showed the global airport market is continuing to normalise after the pandemic-era collapse in traffic, while also facing increasing pressure over sustainability, airport capacity and operational efficiency.

Although passenger traffic remains the key driver of demand, airport profitability is becoming increasingly dependent on balancing aviation-related revenue with commercial and non-aviation income streams as operators seek more stable and diversified earnings sources.

In Europe, mature infrastructure networks and strict environmental regulations are shaping airport development, with growth constrained by capacity limits at major hubs and a strong emphasis placed on efficiency and commercial revenue generation.

Asia remains fastest-growing airport market

The United States continues to benefit from a vast domestic aviation network that supports stable passenger volumes and steady aviation income, while terminal modernisation and commercial developments are helping boost non-aviation revenue.

Asia remains the world’s fastest-growing aviation market, driven by surging travel demand and ongoing airport expansion, creating opportunities for both aviation-related and commercial revenue growth.

Against that backdrop, Airports of Thailand has announced a sharp increase in international passenger service charges (PSC), raising the fee to 1,120 baht per passenger from 730 baht, effective from June 20, 2026.

The new rate will apply at all six airports operated by AOT: Suvarnabhumi, Don Mueang, Chiang Mai, Mae Fah Luang Chiang Rai, Phuket and Hat Yai airports, while domestic passenger charges will remain unchanged at 130 baht per person.

AOT expects PSC increase to add 10 billion baht annually

The PSC increase follows approval in principle by the Civil Aviation Board at its December 3, 2025 meeting chaired by Deputy Prime Minister and Transport Minister Phiphat Ratchakitprakarn. Authorities said the higher fee was unlikely to affect passenger travel decisions and noted that Thailand’s PSC rates still remained lower than those charged at many overseas airports.

Paweena Jariyathitipong, president of AOT, said adjusting PSC rates to better reflect actual costs would increase the company’s annual revenue by around 10 billion baht.

She stressed that PSC revenue was not a tax and was not intended as profit-generating income, but would instead be used solely for airport-related operations and service improvements.

Massive airport expansion plans underway

AOT said the additional revenue would help fund continuous upgrades across its six airports to improve convenience, speed and passenger safety.

Over the next five years, the company plans airport expansion projects worth around 80 billion baht, most of which have already completed feasibility studies and are awaiting consideration by the National Economic and Social Development Council.

Among the flagship projects is the East Expansion development, valued at about 12 billion baht. The proposal has already been submitted to the Cabinet Secretariat and, if approved by the Cabinet, bidding could begin immediately. Construction is expected to start late this year and take around four years, with operations scheduled to begin in 2030.

AOT is also preparing the third-phase expansion of Don Mueang Airport, a project worth 69 billion baht. Initial investment during the first five years will focus on infrastructure and Terminal 3, with spending of around 30 billion baht. The proposal is currently under review by state planning and transport agencies, with Cabinet submission expected later this year and construction targeted for early next year.

Suvarnabhumi and Phuket projects advance

The revised 2025 master plan for Suvarnabhumi Airport includes infrastructure and utility upgrades worth around 20 billion baht.

Meanwhile, Phuket Airport’s second-phase expansion project, valued at roughly 10 billion baht, aims to increase passenger capacity to 18 million travellers annually from the current 12.5 million.

Paweena said AOT remained financially ready to support the planned investments, with part of the funding already allocated separately from the company’s average cash reserves of around 10 billion baht. Additional PSC income would also be used to support airport development, eliminating the need for new borrowing.

Beyond infrastructure expansion, AOT also plans to improve passenger services by introducing Common Use Passenger Processing Systems (CUPPS) to shorten waiting times, improve check-in efficiency and enhance the overall passenger experience.