State of the Industry
“Ensuring Another Successful 70 Years for Airports”
Remarks by Kevin M. Burke
President and CEO
Airports Council International-North America
2018 ACI-NA Annual Conference and Exhibition
October 1, 2018 │ Nashville, TN
As Prepared for Delivery
Good morning! Welcome to Nashville, TN, for the 2018 Airports Council International – North America Annual Conference and Exhibition.
Thank you, Mayor Briley, for being with us today. We appreciate your warm welcome to your great city, and for the Southern hospitality I know we will experience over the next few days.
As the industry’s premier event, our conference provides the airport industry with the opportunity to meet and forge strong partnerships for the betterment of the industry. We are also very proud of our position as the largest “for airports, by airports” event in the world.
I am pleased to announce that this year’s event has drawn more than 2,200 attendees. And, with more than 190 exhibitors in 300 booths, this is our largest trade show floor to date.
I want to thank the ACI-NA team for producing another world-class event. It always amazes me how we pull this off year after year. We could not do it without the support of our Board of Directors, under the leadership of Candace McGraw. Let’s give a round of applause to the ACI-NA leadership and team.
I also want to extend a very special thanks to Doug Kreulen and the great team at Nashville International Airport for their incredible leadership as our conference host. Please give Doug and his team a round of applause.
This event is made possible because of the strong support of our sponsors and exhibitors who find great value in participating every year. Please be sure to visit the exhibitors during show hours while you’re here in Nashville.
2018 represents a great milestone for Airports Council International-North America as we celebrate our seventieth anniversary as the Voice of Airports in North America. In my brief time with you this morning, I would like to reflect on our past successes and look ahead to the future.
As we all know, air travel – and the world – have transformed immensely over the last seventy years. And our industry’s evolution along with it hasn’t always been easy or certain. That’s one of the chief reasons ACI-NA exists.
Seventy years ago as we entered the golden age of travel, airports faced many of the same challenges we see today, including burdensome government regulation, infrastructure and investment needs, and dependence on airline decision making.
Realizing there was power in joining together, nineteen founding members convened in 1948 in New York to establish a body that would bring airports together to address the challenges and issues of an evolving aviation industry. That’s when our journey took off as the Airport Operators Council.
Since then, this industry has overcome significant hardships and setbacks: economic uncertainty, airline industry deregulation, airline consolidation, and the tragic September 11, 2001 attacks. This industry has always had to be nimble and responsive to the challenge of the day.
Your association has had to be nimble too. In the past seventy years, our name has evolved to Airports Council International-North America in an effort to make room for our ever-growing U.S. and Canadian membership and global connections.
While the issues of the past may sound familiar today, so much has changed. Today, airports operate more as businesses than ever before.
Throughout my career, I have had the fortunate opportunity to work with many business leaders. In my time with ACI-NA, I have seen firsthand how airport directors – large and small – manage their organizations like Fortune 500 companies. And, that’s the way it should be.
Like their private sector counterparts, airports are valuable assets that contribute to the growth of jobs and economic output across North America and beyond.
In the United States, we continue to see this industry grow and thrive. Next week, we will be unveiling the latest results of our newest Economic Impact Study. This study summarizes the economic benefits that the 493 commercial airports in the U.S. make to the national economy.
But, I wanted to give you a first look at the study’s findings today. U.S. commercial airports are responsible for 11.5 million jobs with a payroll of more than $428 billion. To break that down, there are 2 million more jobs supported by the airport industry than in 2014. The total economic output of U.S. commercial airports exceeds $1.4 trillion — more than 7% of our nation’s GDP. This represents more than $271 billion in growth since we last conducted this study in 2014.
Earlier this year, the Canadian Airports Council conducted a similar study. The study found that Canada’s airports provide 194,000 direct jobs, $19 billion to the national GDP and $48 billion in direct economic activity.
These numbers reaffirm that North America’s airports are indeed powerful economic engines.
Just like any other business, the current landscape for our industry presents many unique challenges that require innovative solutions.
Last year, more than 1.8 billion passengers arrived at and departed from North America’s airports last year. According to the latest North American Traffic report, passenger traffic grew by nearly 4 percent and cargo traffic increased 7 percent in 2017. ACI World predicts that two billion passengers are expected to travel through North American airports by 2020 and three billion by 2035.
Meeting the demands of passenger and cargo growth has never been more important. Our airports must have the ability to modernize as they seek to accommodate rapid growth in passenger and cargo traffic. In the United States alone, airports need nearly $100 billion in infrastructure upgrades and maintenance between 2017 and 2021. Many Canadian airports are experiencing similar constraints on infrastructure and capacity, even after investing more than $25 billion in airport infrastructure since 1992.
Given the current state of airport infrastructure and the constraints on airports to make necessary investments, our ability to remain powerful engines of economic growth is at risk. It is critically important that we continue our efforts to advance airport priorities in Washington D.C. and Ottawa to ensure a competitive and economically viable 21st century airport system.
Solving today’s challenges is essential in order to lay the foundation for the future. While ACI-NA works in Washington D.C. and Ottawa, you—our member airports–are actively working to enhance competition, create efficiencies through technology, and improve the passenger experience.
But that job has gotten much harder due to airline industry consolidation.
There used to be more than thirty airlines that no longer exist because of airline consolidation. What’s worse, our industry has not seen any new carriers despite a strong economy in North America. The future of the airport industry is threatened if we don’t have an economic climate that fosters airline competition and choice.
Additionally, many of our members are working through the ACI World Expert Group on Slots to examine opportunities that strengthen airline competition by reforming the global slots system.
While airports best understand the functionality and capabilities of airport infrastructure to help drive efficiency, airports currently do not have a seat at the table in slots management – and we should.
Competition which can be enhanced through more air service routes and more airline choices, has many benefits in our industry. In order to ensure communities in North America remain connected to the global marketplace, we are actively working to make certain our industry – airports and airlines – are as competitive as they can be. Our work in this important area will only grow in the years ahead.
A strong partnership between airports and airlines is essential for our continued success. That is why we must continue to find ways to work together, even on the issues where we might disagree. At the end of the day, airports need airlines and airlines need airports. That’s the symbiotic nature of our business.
To help foster those partnerships, we are already working to improve next year’s JumpStart® Air Service Development Conference. Recruiting and retaining air service is a big job, and airport resources are limited. I know air service is important to every airport director. As such, I look forward to how JumpStart® will grow as we host it in this city – Nashville – in June 2019.
Technology will also be a large part of an overall improved and seamless passenger experience. How can we adapt current technology to further enhance the airport experience? What new technologies can we use to our benefit?
Biometrics has made its debut at North American airports. This technology is speeding up the boarding process for certain flights. In a just a few years, boarding and other airport processes may be accomplished with the scan of a face. But, we are not there yet. We have many more hurdles to jump through, along with our government agencies and airlines partners, in integrating this exciting technology.
It’s clear we must focus on enhancing the passenger experience in order to ensure a successful future. But, these challenges are too big for anyone to handle alone. And that’s where your association comes in.
Members often tell me the real value of ACI-NA comes through our ability to advance airport priorities in Washington D.C. and Ottawa, provide essential industry intelligence by keeping up-to-date on the issues impacting airport operations, and foster industry collaboration.
One of the chief ways ACI-NA does this is by offering our members a forum to engage and collaborate with industry colleagues. Beginning today, our members have access to a new, fully integrated ACI-NA website. The website offers you direct access to industry best practices and important intelligence to help aid your decision making.
What’s more, the new website will expand our influence by giving us a platform to better educate policymakers and the traveling public. This will be an important tool as we continue our work to move the needle in Washington D.C. and Ottawa.
As we celebrate our seventieth year with a strong membership and transnational – even global – reach, thanks to our colleagues at ACI World, we recognize that there are still obstacles to overcome. We’re not done yet. We’re just getting started.
And, we cannot do it without you. ACI-NA is only as strong as its members and their active engagement. So, thank you for your continued participation in your trade association.
Again, thank you to our attendees, sponsors and exhibitors for joining us this year for another successful event. I will be walking around on the show floor and I hope to see you there.
Here’s to the next seventy years!