Air Traffic Control Equipment Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

Air Traffic Control Equipment Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

The air traffic control equipment market was valued at USD 8.5 billion in 2021 and is projected to register a CAGR of over 7% during the forecast period.

During COVID-19, air passenger volume has been severely decreased across many prominent countries. As the regional governments-maintained entrance restrictions in response to virus concerns, the number of passengers on international routes also depleted. For instance, South Korea's air passenger volume decreased 7.7% in 2021 compared to the previous year. Japan's aviation sector also witnessed a significant impact; Narita International Airport in Tokyo saw 5.2 million passengers in 2021, 50% fewer than in 2020. Nevertheless, the international flight restrictions have been lifted across most countries, and the air traffic is gradually picking up, which will likely increase the demand for air traffic management equipment over the forecast year.

The growth in air traffic is the primary growth driver for the market. The increase is currently more in the Asia-Pacific region, where the number of passengers who travel by air has been continually increasing. An increase in the number of airports in emerging economies and the need for efficient airspace management have forced airports and airlines to invest in air traffic control technologies.

The communication equipment segment accounted for the largest share of the market. A large percentage of the segment has been primarily attributed to the fact that the communication between pilots and ground control operators is essential for an orderly flow of information regarding aircraft information for air traffic management. Earlier, voice communication systems, which involved the transmission of information between air traffic controllers and pilots, were primarily used to manage air traffic. However, these conventional voice communication systems cannot function effectively in congested airspace, which has propelled the need to develop advanced communication equipment for air traffic control, attracting huge investments. Thus, this segment is projected to register the highest CAGR during the forecast period.

Currently, North America is the largest for air traffic control because many airports in United States and Canada have been installing new ATC equipment for air traffic management. However, the Asia-Pacific region is projected to be the fastest-growing market over the forecast period. Factors, such as increasing air travel in the area due to reductions in airfares and the growth in the number of people who could afford air travel, focus on free and fair trade agreements, implementation of stringent aviation safety regulations, and airport infrastructure developments, have been driving the growth of the market in the region.

Moreover, an increasing number of airport construction projects will likely help the air traffic management market over the forecast period. For instance, in January 2022, China witnessed a new round of airport construction and expansion projects. The fourth phase of expansion of the Shanghai Pudong International Airport has begun and is expected to facilitate 130 million annual passengers by 2030. In East China’s Fujian Province, Xiamen has started new airport construction in Xiang’an. As of now, eight construction projects are going on in Xiang’an with a total investment of USD 9.76 billion.

With an investment of more than USD 1.3 billion, Delhi airport is set to undergo a major upgrade by the end of 2022. Expansions include an upgrade of the existing Terminal 1, building a fourth runway, and other development work, aiming to double the airport’s capacity to 40 million passengers a year from the 20 million currently.​ With the completion of this project, Delhi airport will become the first in the country to have four runways.

Such airport expansion and new construction projects will likely help the market in APAC grow during the forecast period.

Thales Group, Harris Corporation, Indra Sistemas SA, Raytheon Company, and Collins Aerospace (United Technologies Corporation) are some of the prominent players in the market.

Moreover, joint ventures from developing economies with air traffic management companies are expected to help the players extend their market presence. For instance, in March 2022, the Airports Authority of India (AAI) entered into a joint-venture with Defence PSU company Bharat Electronics Limited (BEL) for the development of indigenous systems for the surface movement of aircraft at airports and air traffic management in the country. Such joint ventures are expected to help the players to further increase their dominance in the market.

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