Mauro Nogarin discusses the history and development of Peru’s largest airport, based in Lima.
Jorge Chavez International Airport (LIM) in Lima, Peru, has been selected by Skytrax Research as the best airport in South America for the third
consecutive year. This year’s competitors included José Joaquin de Olmedo International Airport in Guayaquil, Ecuador, and Guarulhos Airport in Sao Paulo, Brazil, which received second and third places respectively.
The survey considered 39 different aspects of each airport, including access, comfort, ambience, cleanliness, immigration services, processing time, baggage handling, signage, and ease of connections offered to passengers. The quality of service and the behaviour of airport personnel were also scrutinised.
There are two factors responsible for the recent modernisation of the Lima airport. Firstly, an investment of over US$600 million was used to renovate hotel infrastructure. Promotions of various tourism-related events have also been invested in, such as the 100th anniversary of the discovery of Machu Picchu, the ruins of a 14th Century Inca site. Secondly, the growth of the Peruvian economy has played a key role in the airport’s success. In 2010, the country saw an 8.78% increase – the highest in South America – with similar growth expected for this year. The Peruvian government declared 2011 the “Centennial Year of Machu Picchu for the World” and organised a variety of celebrations to commemorate the event in July. Machu Picchu and Cusco are the main tourist attractions of the country and attracted more than 700,000 visitors in 2010, of which 70% were from overseas.
Last year the passenger traffic at LIM continued to increase. A total of 10,281,369 passengers utilised the facilities, making it the busiest airport in Peru. In fact, the airport saw a 17% increase in passenger traffic in 2010, with year-on-year growth of 6% in 2009 and 10.4% in 2008. International departures increased by 3.4% last year, domestic departures were up by 29.3% and passenger transfers grew 24.4%. There were also 120,496 air traffic movements last year, an increase of 14.8%. Cargo was also up by 17% with a total of 272,000 metric tonnes processed. Gross income also increased by 13%, totalling US$173.24 million, aided not only by the air traffic and passenger growth, but by the dynamic increase in commercial sales, which had growth of 20.4%.
According to the government, Lima Airport Partners S.R.L. (LAP) was formed by the consortium that won the public bid to administer the airport. This consortium comprises the German airport operator, Fraport AG Frankfurt Airport Services Worldwide, with a 42.75% share, Bechtel Enterprises Services Ltd, a subsidiary of the Bechtel Group, with an equal 42.75% and Cosapi S.A., a Peruvian construction company, with 14.5% participation. However, in May 2008, the International Financial Corporation (IFC), a subsidiary of the World Bank, and the Public Services, Infrastructure and Natural Resources Investment Fund, also joined LAP. The shares were then divided between Fraport AG with 70%, IFC 19.99% and the Public Services, Infrastructure and Natural Resources Investment Fund with 10%. The Peruvian government, according to the concession agreement, has given an allowance to LAP for 30 years with the mandate to build, improve, preserve and exploit the Jorge Chavez International Airport.
The development of the airport took place in two stages: the first was completed in December 2004 and the second concluded four years later. The first upgrade project included: expansion of the passenger terminal, installation of seven boarding ramps, construction of a new domestic passenger boarding area and an international passenger terminal, construction of a new cargo depot and new airmail terminal, which currently can handle 8,000 metric tons per day. The second project, inaugurated in January 2009, included the expansion of the international terminal wing by 95,261sq ft (8,850m2), an additional seven boarding ramps, and seven new waiting areas. It also included an expansion of the central area by 57,059sq ft (5,301m2), where the immigration areas were enlarged, six new counters were added for arriving passengers and four new stations were added for departing passengers. The southern terminal was also expanded by 129,167sq ft (12,000m2).
At the end of 2010, a new plan to renovate the infrastructure and expand internal areas was launched. The Jorge Chavez International Airport terminal is planned to have a total area of 927,784sq ft (86,194m2) and the total surface of the platform will be 3,418,489sq ft (317,588m2). The airport terminal will hold 90 commercial establishments and have 19 boarding ramps, 28 pre-boarding waiting areas, 59 boarding gates, six baggage conveyor belts in the international arrival area, 30 immigration counters for arrivals and 16 immigration counters for international departures. In June 2011, the total investment in improvements made by the Lima Airport Partners was over US$272.49 million.
LIM is currently serviced by 16 international and five domestic airlines, and ten freight carriers. In December 2010 it had flights to 36 international destinations and 17 domestic destinations. International flights in the same month were 468 and there were 527 domestic flights. According to information provided by the airport operator, in 2010 there were 5,145,000 international passengers, an increase of 6.5% over the previous year. Of these passengers, 2,157,000 were international arrivals, 2,105,000 were international departures and 882,000 were transit passengers. On domestic flights, the passenger increase was 29.9%, with a total of 5,136,000 domestic passengers of which 2,587,000 were arrivals and 2,549,000 were departures.
International cargo volumes have also increased and reached 239,000 metric tonnes, a 15.9% increase, while domestic cargo volumes totalled 32,577 metric tonnes, a 25.7% increase for a total cargo volume of 271,000 metric tonnes, a 17% increase over 2009. The increase is attributed to the larger cargo capacity resulted from the recent years’ investments.
Passenger traffic projections for 2011 show a 16.2% increase over 2010 with an estimated 11.9 million passengers, international and domestic. In August, passenger movement reached 7,858,437 passengers, a 18.2% increase over the previous year. International departures had increased by 12.2% from 2010. Domestic departures increased at a higher rate, by 22%, while transit passengers increased by 39%. Air traffic movements in August 2011 were 89,872, an increase of 14.1%, of which international movements had an 18.4% increase and domestic movements had a 15.1% growth.
Gross income was US$173.24 million, a 13% increase over the previous year and the commercial establishments had excellent performance with an increase of 20.4%. The increase in passenger traffic, air traffic movements and cargo volumes, as well as the increase in tariffs for RPI-X regulated services, generated an increase in aeronautical income of 10.7% which represented 75% of total income.
In 2003, LAP launched a programme to develop its air routes and has since, in coordination with the airlines, been evaluating potential new routes for the Peruvian market. After seven years of continued investments, the Jorge Chavez International Airport currently has direct flights to 36 international locations and offers flights to 17 domestic destinations. In particular, it has become an important hub for western South America for two important international airlines, LAN and TACA, which between 2006 and 2008 had a growth rate of 22.3% and 35.4% respectively.
Average occupancy rates for flights to Europe are 83% and flights to North America have an occupancy rate of 79%, leaving room for growth on these routes for the airlines in these market segments. Average occupancy rates to Central America stand at 76%, while occupancy rates on flights to South America stand at 74%, which are below the recommended limits. The airport operator continues to evaluate the connections passengers make, in order to determine potential new destinations such as Frankfurt, London, Rome, Washington, Chicago and Detroit. As far as commercial traffic, the operator experienced an increase in the second quarter of 2011 to 168 flights per week, of which 70 were international and 98 were domestic.
Due to this increase in passenger traffic, part of the budget has been invested in airport security and in ongoing training of airport employees in the areas of security and customer service. The goal is to offer the best level of customer service and security possible. The Airport Security Programme, which prevents acts of illegal interference and any actions that could put passengers or aircraft at risk, has been approved by the General Administrator of Civil Aviation (DGAC), a department of the Peruvian Ministry of Transportation. According to this plan, the operator is in daily contact with governmental institutions to coordinate all security matters. From a technical aspect, the Jorge Chavez International Airport has an AODB system to manage air traffic and a BMS system to manage the operation of the air terminal’s operating functions (such as the elevators, escalators, air conditioning and fire detection systems), a CCTV system for monitoring the air terminal and tarmac flows, and an ACS system to control security access.
Currently, one of the main challenges that the airport faces is the lack of space for additional growth. Considering the increase in passengers over the last few years and the projections for continued growth, it is important that the current infrastructure be expanded in the short term and long term. In order to make room for these future expansions, the General Administration of Civil Aeronautics (DGAC) vacated a 139,931sq ft (13,000m2) hangar in early 2010 and the Peruvian government yielded an area of 2,045,143sq ft (190,000m2) adjacent to the landing strip, with the understanding that it be used for airport expansion, specifically to locate the maintenance hangars for the airport. Another future development is the construction of a second landing strip, which should be ready by February 2013 at the latest, according to the concession contract.