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Economy

Bangkok airport capacity to be tripled as tourism booms

Suvarnabhumi Airport already handles 20 million more travelers than intended

Tourists check in at Suvarnabhumi Airport in Bangkok. An influx of travelers from overseas has created severe overcrowding at the airport. (Photo by Keiichiro Asahara)

BANGKOK -- Airports of Thailand has unveiled a 260 billion baht ($7.96 billion) plan that will roughly triple capacity at the country's largest airport over about a decade to meet rising demand.

Suvarnabhumi Airport, the country's main international gateway, opened in 2006 and has an annual capacity of 45 million passengers. But actual usage has hit 65 million as more tourists arrive from overseas, the operator says. A lack of boarding gates and long lines are among the problems that have resulted from the overcrowding.

Expansion will be carried out over four phases, expansion phase 2 to 5, after which the airport will be able to service 150 million travelers annually. Boarding gates will more than triple to 157 from 51 now. The original master plan had called for a total capacity of 135 million, but the plan was revised to accommodate a larger capacity, with demand looking to expand faster than previously anticipated. 

Phase 2, which is currently under way, will expand the main passenger terminal's west side and add a satellite terminal at a cost of roughly 60 billion baht. Those additions, expected to open in 2020, will bring the number of boarding gates to 79 and capacity to 60 million.

Capacity will finally get out in front of demand after the 64 billion baht third phase, which includes the building of a second terminal connected to the existing one and a third runway. AOT expects Suvarnabhumi to be capable of handling about 90 million passengers in 2022, when construction is slated for completion, but only expects to receive just under 80 million that year.

Later steps, slated for completion around 2030, will expand the existing terminal's east side while also building a third terminal, a second satellite and a fourth runway. By adding two more runways, the number of flights landing and taking off from the airport will increase to 120 per hour from 68.

Don Mueang International Airport, about 30 km northwest of Suvarnabhumi, will continue to operate. AOT will mainly use Suvarnabhumi for full-service carriers like Thai Airways International and Don Mueang for budget airlines.

Like other emerging Southeast Asian nations, Thailand lags behind in infrastructure development. The Suvarnabhumi expansion was started under the current military government's campaign to improve infrastructure, but future administrations could delay or revise the plan after elections next year.

AOT, which is 70% owned by the government, is steadily improving its earnings. Net profit climbed 18% to 19.9 billion baht for the nine months ended in June on an 11% jump in sales to 46.9 billion baht.

The company's sales are mainly derived from airport usage fees collected from carriers and passengers, as well as income from commercial tenants like duty-free shops. Earnings are stable because AOT operates all of Thailand's major airports. An increase in tourists is providing a tailwind as well.

AOT is Thailand's second-most-valuable company with a market capitalization of 900 billion baht, making it popular with investors. It trails only oil group PTT, which is also partly government owned.

Yet the airport operator's monopolistic position has also drawn criticism. AOT was put on the defensive late last year after complaints of inflated food prices in its airports. 

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