Brazil airport capacity lags as World Cup looms

Published>Wed, Jul 28 10 12:52 AM

Brazil's airline industry is increasingly concerned that the country will not have adequate airport capacity for the 2014 soccer World Cup because of slow expansion and growing demand for travel.

Ample credit and rising household income have caused a surge in air traffic, leaving the nation's airports struggling to keep up with demand. Industry leaders say expansions are needed to deal with existing traffic and warn that travel in the 12 cities that will host World Cup games could suffer during the tournament.

"The World Cup is a unique opportunity for Brazil to present itself on the world stage, and the airport is the first impression that a tourist gets," said Constantino de Oliveira Jr., chief executive of Brazil's second-largest airline, Gol Linhas Aereas.

"Given the historical levels of (government investment)," he added, "the situation is worrisome."

For years, infrastructure bottlenecks have been one of Brazil's biggest problems as growing auto sales and airline travel, along with a furious expansion in commodities industries, have put strains on ports, highways and airports.

Brazil is already under fire for being behind on construction of stadiums and other World Cup infrastructure.

A report by the consulting firm McKinsey and Co said at the close of 2009, seven of Brazil's 20 principal airports were struggling with overcrowding in both passenger areas and plane berths that frequently led to delays or canceled flights.

The report says Brazil's airports had capacity for 126 million passengers per year, with existing demand of 111 million that is expected to rise to 146 million by 2014. During the Cup alone, McKinsey expects as many as 6 million additional travelers moving through Brazilian airports.

"The three problems that we have in Brazil for the Cup are, No 1: airports, No. 2: airports and No. 3: airports," said Ricardo Teixeira, head of Brazil's Football Confederation, who is also charged with organizing the Cup.

STRETCHED INFRASTRUCTURE

Airport problems range from insufficient parking for both planes and cars to cramped quarters for passengers awaiting flights.

Infraero, the government agency in charge of airport management, did not respond to requests for comment.

The government expects to invest 6.5 billion reais ($3.7 billion) in airports through 2014, including about 5.5 billion reais for those in the 12 host cities.

"We are worried about government investment, yes, but we are confident that the (funding) will be invested in a time frame that will allow for growth," said Pedro Janot, CEO of No. 3 Brazilian airline Azul.

The planned outlays will have to make up for years of underinvestment. Airport investments were 42 million reais in 2003 and 270 million reais in 2007, according to government statistics.

Brazil's airport safety conditions have improved since a 2007 crash that killed almost 200 people when a plane skidded off a runway in Sao Paulo's Congonhas airport.

But critics say investments have still not kept up with demand. Passenger traffic jumped 28 percent in the first half of 2010 from a year earlier, according to Brazilian civil aviation authorities.

"A good airport is one that's constantly under construction," said Paulo Castello Branco, a vice president for TAM, Brazil's largest air carrier.

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