Home Aerospace And Defense Airport Baggage Handling Systems Market Size And Share Report, 2031

Airport Baggage Handling Systems Market

Airport Baggage Handling Systems Market Size, Share & Trends Analysis Report By Airport Capacity (Up To 15 Million, 15-25 Million, 25-40 Million, Above 40 Million) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2023-2031

Report Code: SRAD55390DR
Study Period 2019-2031 CAGR 14.45%
Historical Period 2019-2021 Forecast Period 2023-2031
Base Year 2022 Base Year Market Size USD 1.27 Billion
Forecast Year 2031 Forecast Year Market Size USD 4.27 Billion
Largest Market North America Fastest Growing Market Asia Pacific

Market Overview

The global airport baggage handling systems market size was valued at USD 1.27 billion in 2022. It is estimated to reach USD 4.27 billion by 2031, growing at a CAGR of 14.45% during the forecast period (2023–2031). The demand for better and more efficient baggage-handling systems has led key players to develop smart baggage-handling systems, creating opportunities for market growth.

The airport baggage handling system is a conveyor system that enables the transfer of checked luggage between ticketing counters and aircraft loading gates. This indispensable system serves multiple functions, i.e., bag tracking, load distribution, volume management, and stringent luggage security screening. The BHS has cutting-edge devices like barcode scanners, radio frequency sensors, Automatic Jam Readers (AJR), tilt tray sorters, Automatic Tag Readers (ATR), and vertical sortation units. These cutting-edge components collaborate to ensure travelers' efficient and transparent baggage handling while reducing the workload of ground staff. The significance of a robust and sophisticated BHS cannot be overstated as the number of passengers using airports rises. A well-designed and efficiently implemented system prevents bottlenecks and delays and plays a crucial role in airport security.

Market Dynamics

Global Airport Baggage Handling Systems Market Drivers

Construction of New Airports and Expansion of Existing Airports

Governments in various emerging economies are allocating substantial financial resources towards the improvement of aviation infrastructure in response to the resurgence of passenger travel. This has given rise to the construction of new airports and the extension of existing airports. For instance, the investments in new airports in 2021 were recorded to be over USD 190.6 billion. With the growing emphasis on smart airports, operators invest in new and improved infrastructure. The evolution of technology enables the authorities to incorporate various advanced technologies, ranging from 5G wireless connectivity to biometric screening and baggage drop solutions that enhance the passenger experience at airports.

The new airlines and airports also install the latest baggage handling systems to attain the expanding customer base. For instance, to enhance the efficiency of operations to cater to the rebound in the number of passengers, in January 2022, the Delhi International Airport of India installed an integrated cart system (ICS) at Terminal 1 for baggage handling that has high capacity, high speed, and reliability. Thus, the construction and expansion of airports are expected to drive the airport baggage handling system market during the forecast period.

Growing Terrorist Attacks

Terrorist attacks around the world are increasing, which is good for business. Airports must increase security procedures, including a more in-depth inspection of checked luggage, as the need for safety becomes more pressing. This need to strengthen security drives the demand for advanced baggage handling systems with sophisticated screening technologies. To mitigate the risk of potential threats, airports invest in state-of-the-art baggage screening equipment, such as explosive detection systems and advanced imaging technologies.

Additionally, these systems are integrated into baggage handling procedures to efficiently identify and intercept prohibited or dangerous items. Moreover, real-time tracking and monitoring solutions are gaining popularity to ensure the safe and traceable movement of luggage throughout the airport. As a result of the escalating terrorist threats, airports must devote significant resources to adopting and enhancing technologically advanced baggage handling systems. This protects passenger safety and reinforces the importance of such systems in maintaining the integrity and security of global air travel.

Global Airport Baggage Handling Systems Market Restraints

Risk of Cyber Attacks

The interconnected technology has attracted new vulnerabilities and potential exploits, which makes airport cyber attacks a real threat today. In recent years, several cyber attacks have occurred on the aviation industry. According to a study by the European Aviation Security Agency, there is an average of 1,000 airport cyber-attacks per month. For instance, in May 2022, The European Union Aviation Safety Agency (EASA) warned that Russia's invasion of Ukraine could unintentionally target civilian aircraft or airports endangered by cyber-attacks.

Over the years, airports have increased the adoption of new technologies, such as electronic tags for baggage handling, data links for voice communication, smart boarding gates, remote check-in, and self-service applications. This has increased the risk of cyber-attacks at airports. Such factors are likely to hamper the market's growth.

Global Airport Baggage Handling Systems Market Opportunities

Growing Demand for Smart Baggage Handling Systems

There is constant pressure to improve the baggage handling process due to the rising levels of competition in the air transport business. Over the decade, the increase in passenger traffic has simultaneously increased the baggage volume, which is the primary reason for adopting automated systems at the airport. The companies are working towards developing new technologies to smoothen the baggage handling process at airports.

For instance, in June 2022, SITA, a Swiss information technology company, collaborated with Alstef Group to introduce Swift Drop, a self-bag drop solution. The new technology is claimed to decrease the time required for airport baggage checks. It lets travelers print their bag tags and load their baggage onto the accessible conveyor. Similarly, camera tag-reading technology enables quicker processing of baggage. Such developments by market players are anticipated to enhance airport baggage operations in the coming years, thereby creating opportunities for market growth.

Regional Analysis

Asia-Pacific Dominates the Global Market

Based on region, the global airport baggage handling systems market is bifurcated into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa. 

Asia-Pacific is the most significant global airport baggage handling systems market shareholder and is projected to exhibit a CAGR of 14.86% during the forecast period. Asia-Pacific held the largest market share due to the much larger population of China and India, which were driving the aviation industry and air traffic in both countries. The Chinese New Year celebration has recorded the largest movement of humans in modern history, driving the need for new airports and improved BHS. China had more than 248 civil airports by the end of 2021. In addition, China plans to have 270 civil airports by 2025, expecting more than 930 million passenger traffic, 9.5 million tonnes of cargo parcels, and 17 million take-offs and landings annually. With such a vast number of airports under construction, there is a massive demand for baggage handling systems.

Moreover, ongoing initiatives are being implemented to expand the current airports in various nations. By the end of 2022, more than USD 1.3 billion investment will have significantly upgraded Delhi airport. The airport aims to boost its capacity from 20 million passengers annually to 40 million. Some of the extensions that are being considered are the creation of a fourth runway, the promotion of Terminal 1, and other improvements. All these factors are expected to drive the regional market growth.

The North American region is expected to be the fastest-growing market. As per the Bureau of Transportation Statistics, the airlines operating in the US carried a total of 674 million passengers as of 2021, increasing by 82.5% passengers as opposed to 369 million passengers in the year 2020. With such a high number of passengers utilizing air travel, the demand for baggage handling systems is significantly high in the US. It is expected to grow exponentially during the forecast period. Moreover, airports are gearing up with expansions and infrastructure investments to better position themselves to tackle the projected increase in demand. As a result, government investments were also witnessed in the region.

For instance, the government of Canada announced support packages for investment in upgrading the infrastructure at Toronto Pearson International Airport in March 2022, with new funding for critical infrastructure projects. As part of this, the airport is expected to receive more than CAD 142 million from Transport Canada's Airport Critical Infrastructure Program. This investment will be used to develop and install new check-in and baggage drop-off counters and boarding counters to improve the baggage handling capabilities of the airport.

Europe is expected to grow significantly because of the surging air passenger traffic. According to the World Bank records, France recorded 71.28 million passengers using air travel as of 2019. However, this figure dropped to a low of 24 million in 2020, considering the international events in France every year. This led to a slump in the airports' economy and reduced market opportunities for the baggage handling systems market. However, with the projected increase in air travelers, airports nationwide are gearing up and upgrading their facilities to serve the market.

Despite the slowdown due to the pandemic, developments concerning improving the baggage handling systems have been underway for European airports. For instance, in June 2020, Leonardo was awarded a contract by Frankfurt Airport Services Worldwide to install a baggage handling system with safety and sorting capabilities at the new Pier G of Terminal 3 at Frankfurt Airport. With its two Multi-Sorting Baggage Handling System (MBHS) cross-belt sorting machines, the system can handle the bags of approximately five million passengers annually.

Brazil dominated the Latin American market. Brazil witnessed a significantly high number of passengers until the year 2019. In 2020, Brazil experienced a significant decline of 55.88% in aviation passenger volume. Nevertheless, the anticipated surge in aviation passengers has compelled several regional airports to enhance their infrastructure or acquire new technologies. For instance, Brazil has taken innovative initiatives to overcome the existing drawbacks of baggage security checks at Brazilian airports. In June 2022, Brazil introduced new baggage security screening regulations in which screening through X-ray machines would be a major introduction. The authorities are also introducing an automated baggage security system so that there is no delay in the baggage delivery to the passengers after the landing of the flights. Also, it has been noticed that the automated system will be more efficient in managing the baggage much better than human management.

Report Scope

Report Metric Details
By Airport Capacity
  1. Up To 15 Million
  2. 15-25 Million
  3. 25-40 Million
  4. Above 40 Million
Company Profiles Daifuku Co. Ltd. Alstef Group Siemens AG CIMC TianDa Holdings Co. Ltd G&S Airport Conveyer Vanderlande Industries BEUMER Group Ansir Systems SITA Leonardo SpA.
Geographies Covered
North America U.S. Canada
Europe U.K. Germany France Spain Italy Russia Nordic Benelux Rest of Europe
APAC China Korea Japan India Australia Singapore Taiwan South East Asia Rest of Asia-Pacific
Middle East and Africa UAE Turkey Saudi Arabia South Africa Egypt Nigeria Rest of MEA
LATAM Brazil Mexico Argentina Chile Colombia Rest of LATAM
Report Coverage Revenue Forecast, Competitive Landscape, Growth Factors, Environment & Regulatory Landscape and Trends
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Segmental Analysis

The global airport baggage handling systems market is segmented by airport capacity.

Based on airport capacity, the global airport baggage handling systems market is bifurcated into up to 15 million, 15-25 million, 25-40 million, and above 40 million. 

The above 40 million segment dominates the global market and is anticipated to exhibit a CAGR of 14.28% over the forecast period. The number of airports entering the above 40 million segment has increased over the years due to the steep growth of air passengers globally. These numbers are expected to increase further by 2023 as several airports expand their passenger handling capacity through infrastructure expansion. Many airports are installing advanced baggage handling systems to attain a growing number of passengers at the airport. For instance, in December 2021, A new baggage handling system (BHS) operated at Shenzhen International Airport, China Satellite Terminal. The primary part of the BHS was installed in a new satellite expansion north of Terminal 3 and is designed to accommodate an additional 22 million passengers per year. These airport expansion projects are anticipated to create demand for new baggage handling systems to efficiently process passengers and baggage within the airport.

Airports with a passenger handling capacity of 25-40 million have grown, with new airports entering this segment from the 15-25 million segment. This is mainly due to the investments to increase airports' passenger handling capabilities through terminal expansion and modernization. Airports such as Paris Orly Airport, Seattle-Tacoma Airport, Houston George Bush Airport, Shanghai Hongqiao Airport, and New York JFK International Airport fall in this category. Such airports are expanding to accommodate the increasing number of passengers. For instance, in February 2022, New Terminal One (NTO) is a passenger terminal set to be built at the John F. Kennedy (JFK) International Airport in New York, United States, as part of broader plans to transform JFK into a world-class airport. NTO infrastructure will include 23 new gates upon completion. The first new gates of the terminal are anticipated to be opened in 2026. The entire project is expected to be completed in 2030. The installation of electric-powered ground service equipment, including baggage tractors and belt loaders, will be done at the new terminal.

Airports connecting small cities and islands often fall in the up to 15 million. Several new airports will be opened over the next decade to enhance regional connectivity in several countries. This will significantly generate the demand for baggage handling systems over the next few years. Smaller airports with up to 15 million passengers are running over full capacity owing to ease of travel in many countries post-pandemic. For instance, in January 2022, Malaysia's airports observed a surge in passenger traffic. The airport in Malaysia has a capacity of 3.11 million passengers. The international passenger movement in Malaysia skyrocketed by 114%, owing to the resumption of Umrah travel or Islamic pilgrimage and the Vaccinated Travel Lane (VTL) program between Malaysia and Singapore. This increasing number of airport passengers is expected to have significant investment toward optimization of the airport operations anticipated during the forecast period, generating demand for advanced baggage handling systems from this category of airports.

Market Size By Airport Capacity

Recent Developments

  • July 2023- Alstef Group, an FTE Baggage Innovation Working Group member, won the contract to design, supply, implement, test, and commission a new baggage handling system at Gwalior Airport in Madhya Pradesh, India.

Top Key Players

Airport Baggage Handling Systems Market Share of Key Players

Daifuku Co. Ltd. Alstef Group Siemens AG CIMC TianDa Holdings Co. Ltd G&S Airport Conveyer Vanderlande Industries BEUMER Group Ansir Systems SITA Leonardo SpA.

Frequently Asked Questions (FAQs)

How big is the airport baggage handling systems market?
The global airport baggage handling systems market size was valued at USD 1.27 billion in 2022. It is estimated to reach USD 4.27 billion by 2031, growing at a CAGR of 14.45% during the forecast period (2023–2031).
Asia Pacific has the highest growth in the global market.
Key verticals adopting the market include: Daifuku Co. Ltd., Alstef Group, Siemens AG, CIMC TianDa Holdings Co. Ltd, G&S Airport Conveyer, Vanderlande Industries, BEUMER Group, Ansir Systems, SITA, Leonardo SpA.
Construction of new airports and expansion of existing airports and growing terrorist attacks are the key driver for the growth of the global market.
Growing demand for smart baggage handling systems is one of the upcoming key trends in the global market.

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