Airport security sector set to take off

The airport security sector is still expected to soar despite US budget cutbacks as air traffic grows and the threat of terrorism persists, analysts say. Screening passengers and baggage as well as surveillance at airports is a business that has boomed as countries radically tightened security in the wake of the September 11 attacks. While airport security is one of the areas to be hit in the United States by mandatory budget cuts, the expected growth of air travel is expected to drive increased spending on security. \"Airport security is a market niche which is outperforming that of the aviation\" sector said Didier Brechemier, an expert at the Roland Berger consultancy. \"It grows along with the volume of passengers which is growing itself by five to six percent per year,\" he added. According to the International Air Transport Association (IATA) more than 3 billion passengers will travel by air this year, almost double the number that flew in 2001. It expects another doubling of passenger traffic by 2030. The airport security screening market is worth some $10 billion (8 billion euros) annually, according to Philippe Nguyen, president of the IPE investment fund which is in the process of acquiring ICTS Europe, one of the leaders in the sector.If physical security at and around airports is included the market is worth over $22 billion, according to the Visiongain business information service. Visiongain notes that national governments are increasing spending on developing new airport facilities and expanding existing ones to meet increasing air travel, with spending on enhancing security also rising. \"Contract sizes and financial data released by companies involved in the industry indicate this and would suggest that the market will continue to expand,\" said Visiongain. While the US and European markets are the biggest airport security markets, the Asia Pacific region is expected to see the biggest growth as the aviation sector there booms. China alone is expected to inaugurate 70 new airports in the next decade. \"The market is promising for a number of reasons, including growth in passenger travel, the emergence of major hub airports, the increasing aircraft order books, legislative changes and the drive from airports to deliver a better passenger journey,\" said the British group G4S, one of the top companies in the sector. Relaxation of restrictions on carrying aboard airplanes certain items, such as small knives in the United States or plans by the EU to change its rules on liquids, should be a further boost for security companies.A change by the EU liquid policy would lead to \"an increase in controls to analyse these liquids before authorising them onboard,\" said Xavier Gondaud, head of the airport security department at Securitas, another top company in the sector. The changes are coming amongst growing recognition that airport security is becoming too cumbersome and threatens to become an impediment to growth of air travel. IATA chief Tony Tyler said at a recent aviation security conference that a right balance needs to be struck between risk and regulation. \"If we don\'t find the right balance soon we will lose the goodwill of our passengers and shippers, clog our airports, slow world trade, and bring down the level of security that we have worked so hard to build-up,\" said Tyler. The effort to improve airport security will likely provide plenty of commercial opportunities as it is expected to rest heavily on new technologies. In addition to new types of screening equipment, the drive to better target screening by use of information on travellers available to border control agencies will rely heavily on technology and data gathering.