40 AVIATION WEEK & SPACE TECHNOLOGY/MARCH 30-APRIL 12, 2015 AviationWeek.com/awstAdrian Schofield AucklandHong Kong, Singapore highlight
their airport growth needs
G
overnments in Singapore and Hong Kong are throwing
their weight behind major airport expansion projects,
as these important hubs strive to maintain a competi-
tive edge over foreign rivals.
Both Hong Kong and Singapore have profited immensely
from airports that have become vital connecting points for
many international trafc flows. But their lucrative model is
increasingly under threat, and new runways and terminal
projects are regarded as essential to keep up with growing
hubs in Southeast Asia, mainland China and the Middle East.
Changi Airport in Singapore is planning a massive fifth
terminal complex—with a new runway—even before it has
finished building its fourth, and is also renovating Terminal 1.
Meanwhile, construction could begin as early as next year on
a third runway for Hong Kong International Airport (HKIA).Singapore Transport Minister Lui Tuck Yew revealed new
details of the Terminal 5 development in his annual budget
presentation. The Singapore government is well aware of
the vital role Changi plays in the national economy, and Lui
stresses that the “ambition is for Singapore to remain as
Southeast Asia’s foremost air hub and one of the major hubs
in Asia and across the world.”
Lui notes that in addition to current construction projects,
Changi will need new capacity by the mid-2020s, which is
when Terminal 5 is expected to open. The facility eventually
will be able to handle 50 million passengers a year—almost
equal to the capacity of the existing three terminals com-
bined. However, the development timetable can be altered if
growth does not meet expectations.
A Changi development fund will be established, with S$3
billion ($2.2 billion) in initial capital, to support airport expan-
sion. “More will be added [to the fund] as the budget allowsin years to come,” Lui says. However, no full cost estimate for
Terminal 5 has been released.
Concept drawings have been completed, with more de-
tailed plans to be drafted over the next 2-3 years. Alongside
the terminal site, a military airfield will be extended and
converted to civil use for Changi’s third runway, expected to
open in the early 2020s.
Terminal projects already under construction will help
boost Changi’s competitiveness in the short term. In addi-
tion to the redevelopment of Terminal 1, a new passenger hall
called the Jewel is being built beside it. This glass-enclosed,
dome-like structure is due to open in 2018.
Another terminal is being built to replace a former budget
airline facility. Terminal 4 will primarily house gates for nar-
rowbody aircraft, for both full-service and low-cost carriers.
Cathay Pacific Airways has agreed to move into the terminal
when it opens in 2017, and Changi ofcials say discussions are
being held with other carriers.
Singapore Airlines is supportive of these projects. “From
our perspective, we certainly welcome plans for the further
expansion of Changi Airport,” an airline spokesman says. The
carrier also has “expressed preliminary interest” in operating
from Terminal 5 when it is completed.
Meanwhile, the Hong Kong government is also convinced
of the need for its airport to expand
to remain competitive. Adding a third
runway at HKIA is seen as a top pri-
ority, highlighted in the recent bud-
get speech by Hong Kong Financial
Secretary John Tsang. He describes
the runway as “imperative” for the
airport “to meet our long-term air
trafc demand and to maintain our
status as an international and region-
al aviation center in the face of fierce
competition from other airports in
the region.”
Tsang says construction could be-
gin in 2016 for commissioning in 2023.
With this expansion, the airport could
handle 100 million passengers and
9 million metric tons of cargo annu-
ally by 2030, he says.
Building the runway is complicat-
ed by the fact that it will be sited on
reclaimed land, and the cost is esti-
mated to be HK$141.5 billion ($18.4 billion). The project has
undergone environmental review and been approved by the
Hong Kong Executive Council.
While airlines support HKIA’s plans for the third runway,
they are concerned about how it will be financed. The Hong
Kong Board of Airline Representatives insists the runway
can—and should—be built without increasing passenger or
airline fees.
Dominant carrier Cathay Pacific notes that the airport
authority is among the most profitable in the world, and has
a strong cash flow and healthy balance sheet. This means
runway construction could be “self-funded through existing
revenue streams,” the airline says.
The International Air Transport Association agrees that
the airport’s “advantageous financial situation” should be lev-
eraged to support the commercial loans or bonds that would
pay for the runway. cCOMMERCIAL AVIATIONHub Hopes
The Jewel passenger facility,
due to open in 2018, is one
of many growth initiatives
at Singapore’s Changi Airport.CHANGI AIRPORT GROUP