Author: Dr. Jean-Paul Rodrigue
Mega airports are emerging as major hubs of global air passenger and freight activity.
1. Mega Airports in a Global World
The substantial growth of air travel has been associated with the demand for new airport terminal facilities, particularly in the context where an existing airport terminal is no longer able to handle current or anticipated traffic. Expectations about future passenger volumes are inciting the consideration of large airports consuming a significant amount of land that has to be found, secured, and developed. This has led to the siting and setting of mega airport complexes, including large terminals, hangars, parking facilities, runways, space for adding new runways as well as space for ancillary activities such as hotels, offices, and distribution centers. The airport has become a miniature city while, in several cases, large airport complexes have been dubbed as “aerotropolises“.
The drivers of mega airport projects fall into two major categories:
- First, regional economic development will incite organic traffic growth, both for passengers and freight. The risk is to overestimate the potential traffic and build too much capacity for the expected demand. This leads to lower returns on investments.
- Second, major airlines can decide to use an airport as their main hub, implying growth in transit traffic. The hubbing function of a major airline is associated with substantial traffic, but the risk is that the airline may elect for another hub.
Both these drivers can be subject to contention since, on one side, economic growth expectations may not materialize to their full extent, while on the other side, airlines can change their network strategies and elect for other hubs (or use the existing hub less extensively). In a high growth context, this places acute pressures to expand airport infrastructure to cope with significant expected future traffic levels. The most successful mega airport projects are thus those that jointly gain from regional economic development as well as the additional traffic that hubbing generates. However, like most mega infrastructure projects, mega airports are subject to over-expectation biases over four key issues:
- Technological appeal. The expectation of creating infrastructure using the latest materials and construction techniques, even if they can be untested.
- Political appeal. The common expectation of leaders and politicians is to be associated with large infrastructure projects, which can influence their location, size, construction time frame, and purpose.
- Economic appeal. Large consulting and construction firms are attracted to mega infrastructure projects because of the revenue and the recurring cost overruns. Labor unions are able to secure long-term employment for the construction and operation of these facilities.
- Architectural appeal. The expectation is that the facility will have an aesthetic value, creating a recognizable landmark for the region.
Therefore, new airports are increasingly costly, complex, and set further away from central areas. The availability of a large and suitable real estate footprint can lead to controversy and conflicts with local residents. Mega airports are such large projects that they are usually set into development phases, but the real estate footprint needs to be secured at the onset of the project, tying up land for decades. These phases either expand the airport real estate footprint with additional runways, add terminals, or ancillary activities such as commercial and logistics real estate. In time, mega airport terminals become architectural landmarks for their city.
The major challenge remains financing since airports are usually publicly funded and require substantial capital investment locked for long periods of time and with uncertain returns. They are rarely profitable but often marketed as symbols of economic success. This is particularly the case in the Middle East where mega airports such as in Dubai, Abu Dhabi, Qatar, and Kuwait have recently been constructed in a context where the local demand is not sufficient but where large carriers such as Emirates, Etihad, and Qatar Airways have received massive subsidies in conjunction with their respective mega airports.
2. Dallas / Fort Worth
The Dallas / Fort Worth (DFW) airport is the seventh largest airport in the world in terms of passenger traffic, but the largest in terms of surface (about 4360 hectares). It opened in 1974 and represents one of the first examples of a mega airport terminal project located in a new site; halfway between two important urban agglomerations, about 28 km from the respective city centers of Dallas and Fort Worth, Texas. The DFW airport, therefore, benefits from the air traffic generated by these two major cities.
The airport was built in an era of high traffic growth and high expectations about future growth prospects. In part through the petrochemical sector, the Texan economy was booming, as well as with new industries such as electronics. Air cargo transportation has also become an increasingly relevant dimension of DFW’s operations, with nearby Mexico and Latin America being important factors for this strong growth in cargo traffic. The airport is composed of 7 runways, 4 of which can accommodate the largest commercial planes in existence. When it opened, DFW had an innovative layout designed to accommodate considerable expansion.
DFW, like many mega airports, has substantial economic impacts on the local economy, with some estimates stating an income of over $16 billion annually and a contribution to about 160,000 jobs in the Dallas / Fort Worth area. Texas benefits from its intermediary location between the eastern and western coasts of the United States and of its proximity to Latin America. It thus competes with Miami for this market. Every major city within the United States, Canada, and Latin America is within four hours from DFW. In fact, more than 60% of all the traffic at the airport is related to connecting flights going elsewhere.
Although DFW is a strong consumer of space, the airport design allows for future expansion with a much larger traffic level. Many new airports designed in the 1970s were expecting strong growth levels and secured land and developed infrastructure accordingly. Five new terminals can be added to the existing five, therefore increasing the total capacity to accommodate more than 120 million passengers annually. In the megaproject development plans, it was estimated that by 2010, 100 million passengers would transit through the airport. Traffic figures for 2010 were just over half of what was expected. There was thus a large overestimation of the market potential of the airport, but traffic has been steadily increasing since 2010 to reach 73.3 million passengers in 2022, after a sharp decline during the COVID-19 pandemic, but a quick recovery afterward.
3. Kansai International Airport (Osaka)
With 31.9 million passengers handled in 2019, the Kansai International Airport does not figure among the world’s largest airports. However, it is particularly remarkable in the sense that it was the first airport project entirely constructed on an artificial island, which is a major innovation. The construction of airports in Japan has been facing serious space constraints due to the obvious lack of available flat land near major metropolitan areas. For instance, when the construction of a new airport in Tokyo (Narita) was announced in the 1960s, it led to massive protests because of the expropriation of scarce agricultural land. Therefore, when a new airport facility was required in the Osaka metropolitan area, a decision was made to locate the new airport on an artificial island exclusively built for such a purpose. The goal was to avoid the political and social fallout of a mega airport project, which led to additional construction costs and engineering challenges.
The purpose of the project was to provide additional regional air capacity since the Osaka airport (Itami) was getting congested. Construction of the artificial island started in 1987 followed by the airport terminal in 1991. The airport opened in 1994, an impressive time achievement for such a complex project. It was designed to handle international traffic, including cargo, while the Osaka Itami airport reverted to domestic traffic only. Because of the unique geographical constraints of Japan, the airport was built with strong engineering requirements to be able to withstand earthquakes and typhoons. The resiliency of this engineering was soon tested with the 1995 Kobe Earthquake, which left the airport undamaged. Still, Kansai did not experience noticeable passenger traffic growth through the late 1990s and 2000s. It was only between 2015 and 2019 that the passenger traffic doubled but with no change in cargo. The COVID-19 pandemic had dramatic impacts on passenger traffic which dropped by 92% between 2020 and 2021, with limited recovery since.
Another important engineering challenge that added substantially to construction costs was the gradual sinking of the airport due to the geological conditions of Osaka Bay. While it was predicted that the island would sink by about 6 meters, by 2000 it had sunk by over 9 meters. The airport still continues to sink but at a lower rate. Linking the airport to the mainland also required the construction of a 3.7 km bridge, which was also a major project. Thus, The Kansai International Airport became a pioneering mega-engineering project that set the stage for similar projects such as Centrair International Airport in Nagoya and Chek Lap Kok in Hong Kong. Kansai was deeply
4. Chek Lap Kok (Hong Kong)
Hong Kong is a major financial center and a strategic commercial gateway commanding access to the Pearl River Delta, one of the world’s most significant manufacturing clusters. In 2016, Chek Lap Kok handled 70.5 million passengers, making it the 10th largest in the world, but the first in the world in terms of freight being handled. Hong Kong is likely to be the airport the most impacted by the COVID-19 pandemic, with a drop of 87% in passenger traffic between 2019 and 2020, a net loss of 35.7 million passengers. As of 2022, there has been no recovery in passenger traffic, while freight traffic remained much less impacted.
The original commercial airport of Hong Kong, Kai Tak, was established in 1925 and went through a series of expansions, mostly through land reclamation over Victoria Harbor. By the late 1980s and early 1990, Kai Tak was facing capacity constraints, in addition, to being at a site not well suitable for airport operations. The airport only had one runway, limiting operations, and its approach required a complex series of turns. Still, it had the advantage of being located very close to the central areas of Hong Kong (Kowloon). Once the new airport of Chek Lap Kok was built, the old airport site was converted to other uses, such as residential and commercial activities and a cruise terminal.
The construction of Hong Kong’s new airport terminal, which opened in July 1998, represented a unique geographical and engineering challenge. Since no sufficient amount of flat land was available in Hong Kong, an island of 1,250 hectares had to be reclaimed. Road and rail connections, including a number of bridges, were also built to connect the airport to Kowloon and Hong Kong island, which are located about 34 km from the new airport. A light rail transit system (LRT) links the airport terminal to downtown Hong Kong in about 23 minutes. In addition, ferry services are also directly calling the airport (SkyPier), which represents a rather unique form of airport connectivity.
The airport site, with additional expansions, was designed to jointly handle freight and passengers and could ultimately accommodate about 87 million passengers per year, but its current capacity is about 70 million passengers per year. Two significant expansions have taken place so far. This first was the North Satellite Concourse, which opened in 2009, adding 10 gates used by narrow-body aircraft. The second is the Midfield Concourse, which opened in 2016 and added 20 gates. Land for logistics and cargo facilities was also provided directly adjacent to runways.
In 2018, the Hong Kong–Zhuhai–Macao Bridge (HZMB), a facility of 55 km in length crossing the Pearl River Delta, was completed. It connects directly the airport island to Macau through a series of bridges and tunnels, which is the longest fixed link in the world. Since the bridge links different jurisdictions of China (Hong Kong SAR, Macau SAR, and Guangdong Province), a large border clearance facility was built on 130 hectares of reclaimed land adjacent to Chek Lap Kok island. The facility offers check-in services for passengers accessing the airport through the HZMB.
The mega project thus significantly contributed to maintaining the commercial position of Hong Kong and helped support thriving air cargo operations linked with the development of the electronics sector in the Pearl River Delta.
