Insight: The Big Future for Middle Eastern Airports
The air cargo sector remains one of the most competitive logistics arenas on the planet, yet with major growth in the Middle Eastern market, TLME looks at what to expect in the coming decades and the impact it will have on the regional chain.
After the turbulence of the pandemic, in which carriers saw massive decreases in passenger demand but also massive increases in cargo demand, things seem to be levelling out again.
In fact, at the turn of 2023, the International Air Transport Association (IATA) released data for global air freight markets showing that 2022 full-year demand for air cargo took a significant step back from 2021 (pandemic) levels but was close to 2019 performance.
This means that the sector is finding a new normal, and while Middle Eastern carriers made huge strides forward pre-pandemic, the post-pandemic world is rife with new competition.
As well as the traditional rivals in North America and Europe, the Middle Eastern carriers are also facing new competition from China and India, which means that the region has to up its game if it wishes to maintain its reputation as a global leader.
Massive Investment in the Middle East
The Middle Eastern air cargo market is expected to reach US$27.82 billion by 2028, a rise of almost $10 billion in 7 years, according to ResearchAndMarkets.com.
In practical terms, this means that Middle Eastern airlines will require 2,980 new airplanes valued at $765 billion to serve passengers and trade.
More than two-thirds of those deliveries will enable growth, while one-third will replace older airplanes with more fuel-efficient models such as the Boeing 737 MAX, 787 Dreamliner and 777X.
Further still, the Centre for Aviation (CAPA), has stated that airports in the Middle East will need to invest $151 billion in capacity expansions as the global air passenger demand is expected to increase more than two-fold in 2040.
“This necessitates an investment totaling US$2.4 trillion for Middle East and Asia-Pacific airports until 2040 to accommodate this growth,” according to the Airport Council International.
One major project nearing completion is Kuwait International Airport Terminal 2, which is costing upwards of $4.3 billion.
Being developed in phases, Terminal 2 at the Kuwait International Airport will handle more than 25 million passengers a year, while also aiming to gain Leadership in Energy and Environmental Design (LEED) gold certification.
This would render it the world’s first terminal to attain such a level of environmental accreditation.
There are also expansions underway at Hamad International Airport in Qatar, and at Sharjah International Airport in the UAE, yet the really big news - as tends to be the way at the moment - is coming out of Saudi Arabia.
In November 2022, Saudi Arabia revealed a plan for a six-runway mega airport in its capital Riyadh.
King Salman International Airport aims to take Saudi aviation to the forefront of the world, with the airport intertwined with a new mega-city and a new Saudi airline.
You can watch a video on the vision below:
The construction of the new airport is expected to take a decade to complete, so we're looking at a launch date of around summer 2033, with the initial phase set to open in 2027.
While Qatar and the UAE have long dominated the air transport industry in the Middle East, Saudi Arabia is clearly making a play to become the leading light in the region.
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