Analysis Reports

While India's airport privatisation process got under way, albeit falteringly, in 2006, it took until 2022 for Pakistan's Aviation Ministry to start a similar procedure.

Initially, it focuses on the capital city airport, Islamabad, with the intention to extend it to Lahore and Karachi if successful.

It hasn't been successful yet. The only remaining organisation initially to have shown interest, the TERG consortium of Turkish and UK interests, submitted a below-threshold concession fee offer, which has been referred to the IFC (acting on Pakistan's behalf in the matter).

It may well end up being accepted, because after the initial expressions of interest investors have not been exactly queuing around the block.

Pakistan favours certain friendly countries in the vicinity to take on this challenge - and that is what it is, with distinctly unfavourable economic circumstances and the threat of another flare-up between Pakistan and India; despite some promise in the long term, no rapid short term scalability of the airport is in prospect.

Meanwhile, the government is finding it equally hard to privatise the national airline.

Perhaps these are the reasons that collectively have turned much of the global airport investment fraternity away, but if Pakistan is serious about expanding its air transport business, they are really the ones it needs to be attracting.

Although new aircraft deliveries are playing a key role in Malaysia Airlines' network growth, the airline's parent company is looking ahead to its long term needs by launching further aircraft order campaigns this year 2025.

Malaysia Aviation Group (MAG) is still taking delivery of narrowbodies and widebodies from previous orders, and it recently placed a major order for Boeing 737 MAXs. However, it is already seeking to secure more orders for the next phase of its fleet renewal and expansion.

Widebody and narrowbody delivery delays have complicated the airline's network strategy over the past several months, although recent new aircraft arrivals have allowed the airline to increase routes in key markets.

Adding more long haul flights to Australia and Europe form a key part of MAG's plans to strengthen connecting traffic.

Atlanta's Hartsfield-Jackson International is the world's busiest airport, by some margin, and has been for many years.

It isn't the busiest international airport - that is Dubai International - but passenger volumes continue to grow, mainly thanks to Delta's huge domestic hub & spoke operation, which was the raison d'être for the airport's existence in the first place; it wasn't identified for local point-to-point traffic growth, rather as a transit point.

A lesser known fact is that five decades ago the City of Atlanta bought two large tracts of land outside the city, either of which might be used in the future for building a second airport.

While those land parcels have lain there gathering grass, a private company, Propeller Investments, tried to turn a general aviation facility into that second airport over a decade ago, but fell foul of vested interests that included Delta, which is wedded to Hartsfield-Jackson and vice versa.

Now the city has to make a decision on what to do with the land, which is coveted by the State Natural Resources for environmental protection.

The City won't be rushed into a decision, but one has to be made, which weighs its relationship with Delta against the fact that Hartsfield-Jackson cannot be extended indefinitely. It is already operating close to levels never experienced by entire major city collections of airports, let alone one.

The other question is; who would operate a new airport? For that, at least, there are some suitable candidates.

This is part two of a two-part report.

Atlanta's Hartsfield-Jackson International is the world's busiest airport, by some margin, and has been for many years.

It isn't the busiest international airport - that is Dubai International - but passenger volumes continue to grow, mainly thanks to Delta Air Lines' huge domestic hub & spoke operation, which was the raison d'être for the airport's existence in the first place; it wasn't identified for local point-to-point traffic growth, rather as a transit point.

A lesser known fact is that five decades ago the City of Atlanta bought two large tracts of land outside the city, either of which might be used in the future for building a second airport.

While those land parcels have lain there gathering grass, a private company, Propeller Investments, tried to turn a general aviation facility into that second airport over a decade ago, but fell foul of vested interests that included Delta, which is wedded to Hartsfield-Jackson and vice versa.

Now the city has to make a decision on what to do with the land, which is coveted by the State Natural Resources for environmental protection.

The City won't be rushed into a decision, but one has to be made, which weighs its relationship with Delta against the fact that Hartsfield-Jackson cannot be extended indefinitely. It is already operating close to levels never experienced by entire major city collections of airports, let alone one.

The other question is; who would operate a new airport? For that, at least, there are some suitable candidates.

This is part one of a two-part report.

A major flare-up in hostilities between India and Pakistan demonstrates yet again how the airline industry can be blindsided by geopolitical events outside its control.

There are obviously much more tragic implications from the recent rounds of clashes, but the collateral effect on Indian airlines has still been significant.

India and Pakistan both closed their airspace to each other's airlines, creating expensive rerouting for international flights.

On the domestic front, several Indian airports close to the border with Pakistan were temporarily closed, causing the cancellation of hundreds of flights.

Pakistani airports and airlines have been dramatically affected too, but this overview will focus on the much larger Indian industry.

A ceasefire agreement on 10-May-2025 resulted in airport restrictions being lifted, although it is not yet clear when overflights will resume.

The disruption has come at pivotal time for Indian airlines, as Air India looks to rapidly spool up its international operation, and IndiGo prepares to launch flights to Western Europe this summer with wet-leased Boeing 787s.

New airports are also due to open in Delhi and Mumbai this year.

No doubt the airspace closures will be a point of conversation at the IATA annual general meeting, which is scheduled to be held in Delhi on 1-3-Jun-2025.

The times are changing in Australia, where the airport privatisation procedure was put into place in the 1990s. That resulted in leases of up to 99 years for, in the main, the investment and pension funds that perceived long term value in them.

But latterly those funds have been reappraising their position in line with mergers and acquisitions in their own line of business, COVID-19 and its aftermath, and the realisation that they collectively had an overkill position in the airports sector.

So there have been some recent on-sales, including Queensland Airports, while others are being lined up.

The Queensland lease sale went to a consortium of a local company and the US private equity firm KKR.

Now Amsterdam and Madrid-based Ferrovial is reported to have put down its marker for Perth Airport, at which the lease is collectively owned by six funds, with a bid for 100% of the capital. Australian airports are full to the brim with such funds.

It is another example, following KKR, of foreign organisations moving in on the territory; although Ferrovial would, like that firm, have to find a local partner to satisfy Australian ownership rules.

Perth Airport has a lot going for it, and must be attractive to a company that seems to have exhausted its patience with Europe.

If the price is right (and it has been, in recent Australian deals) all the leaseholders could capitulate.

But Perth's major USP (unique selling proposition) - direct flights to Europe - will soon come to an end.

United Airlines and JetBlue Airways set the US aviation abuzz after reports surfaced that the two airlines were plotting a partnership, with some speculation bandied about that eventually a merger could ensue.

It could be a defining moment if that speculation materialises into another Chapter of M&A in the country's aviation sector; but the reality is - in the short term, the arrangement will mirror typical airline partnerships that are a mainstay of the sector.

Recent messaging by United indicates that the airline sees advantages with JetBlue; yet, on the surface, committing to a complex merger integration to regain lost ground at New York JFK doesn't appear to be a major priority for the airline.

But - in the evolving US market, sometimes priorities could shift quickly.

Mexico's airlines faced a challenging 1Q2025 as geopolitical tensions, economic uncertainty and currency devaluation eroded their profits.

But the country's largest ultra-low cost carrier Volaris believes that some improvement should occur in 2H2025, as the 'visiting friends and relatives' passenger segment (VFR) prepares to travel during the northern hemisphere summer high season.

The return of any stability in demand will be watched closely, as the aviation industry works to navigate a new chapter of uncertainty in 2025 - particularly among price-sensitive travellers.

This regular CAPA - Centre for Aviation report provides a summary of major developments in the aircraft interiors sector, supported by data from the CAPA - Centre for Aviation Aircraft Interiors Database and CAPA - Centre for Aviation News.

This edition covers Mar-2025 and Apr-2025 and features:

A review of the 2025 Aircraft Interiors Expo;

Business plus a rising focus for seat manufacturers;

LEO secures position as the leader of IFC;

Latest global interior updates.

Although the privatisation of airports (even in the US) has continued since the 1960s, so that now 15% or more of airports are privatised to some degree, the same is not true of air traffic control organisations (ANSPs) where it is less than 1% globally with only three organisations, two in Europe and one in North America, having any level of non-state participation.

There are many reasons for this, but ultimately it boils down to government distaste for handing over such a critical industry to the private sector, and that is most evident in the US where the FAA is progressing its own system, NextGen, for completion by the end of the year 2025.

Not surprisingly, the UK has led the way, as it did with airport privatisation, and its ANSP is part-owned by the government, which retains its golden share. Also a clutch of airlines within a consortium, the main airport, and staff. The UK is also home to a large private company, which is involved in ATC operation there and across the world.

The British system, known as NATS, is worthy of investigation, at least by other countries, but it is ridiculed by vested interests in the US, a country which is absolutely wedded to public sector control of this sector.

A new brush sweeps clean, and it is always possible that the current US administration will make some changes. But not quickly, as it remains embroiled in trade wars and trying to stop military ones.

The most likely progress in the US will be if the relevant authority, the FAA, chooses to permit remote control towers, as many other countries have. They are often built and operated by private companies, and can be very cost effective. They equate to the public-private partnership system that has grown in the US latterly as a way of building new airport infrastructure, and sharing the costs and rewards.

This is part two of a two-part report.