Auctioned Airports to Improve by 2013

By Ben Tavener, Senior Contributing Reporter

SÃO PAULO, BRAZIL – Marked improvements to Brazil’s newly-privatized airports, including São Paulo’s main International Airport, Guarulhos, that were auctioned off earlier this year for R$24.5 billion, have yet to be seen on the ground. New operators officially took over last week at three main international airports – in Brasília, São Paulo (Guarulhos) and Campinas (Viracopos) – from state-run airport operator, Infraero.

In São Paulo the two companies are currently working together to ensure a smooth transition period, but complaints have been surfacing that there has so far been little sign of modernization.

But the new operators say they are now working hard to deliver “rapid improvements,” including through the expansion and modernization projects already promised, and that work has begun:

“Larger changes will only be felt from January [2013], when we assume full control over operations,” Antonio Miguel Marques, president of Concessionária Aeroporto Internacional de Guarulhos, the new airport operator company, told O Globo newspaper.

The new operator has set itself a March 2014 deadline for completion of the first phase of the improvement works – four months before Brazil is likely to receive a considerable number of extra passengers for the 2014 World Cup.

The company has vowed to invest some R$2 billion (around US$1B) in the São Paulo airport, and a total of R$4.5 billion (US$2.2B) by 2018, and a third terminal is expected to be built in the style of major Asian airports. Upgrade works should also provide a major increase in aircraft docking capacity, along with extra parking, more baggage carousels and renovations to signage, lighting and bathrooms.

For many who use the airports regularly, both on business and for leisure, the improvements are long overdue and cannot come soon enough: “I have yet to notice any change in Guarulhos: it’s just a total nightmare. The biggest problem is the sheer number of people and how space is used in the terminal buildings,” São Paulo businessman and regular flier Carlos Okada told The Rio Times.

“The general increase in passenger numbers – not to mention the World Cup and other events – mean airports desperately need to up their game,” Okada emphasizes.

Improvements are also being made to the other airports privatized this February: Viracopos International Airport in Campinas (São Paulo State) is set to gain a new terminal: work is said to be ahead of schedule and due for completion by April 2014, with emergency work already underway.

The government recently announced R$133 billion of investment in roads and railways, through private concessions, in a bid to improve Brazil’s aging and overstretched network of infrastructure.

It was later reported that, along with seaports, more airports would likely be next to open up for similar private investment, followed by the news that Rio’s Galeão International Airport and Confins International Airport, which serves Belo Horizonte, would follow suit:

“A change of management at Galeão is absolutely right,” Rio governor Sergio Cabral said, having discussed the topic with President Dilma Rousseff, adding that the airport’s concession should take place “by October.”

Industry experts have generally welcomed the government’s new raft of infrastructure project “concessions” to private companies, agreeing that attracting private capital is the only viable option to see the projects come to fruition in a timely manner and for growth to be sustained in the economy.

The number of both domestic and international passengers traveling through Brazil’s airports continues to rise as more tourists visit the country and also as more Brazilians are now able to afford to fly. The number of Brazilian passengers landing at the country’s airports reaching nearly 69 million in 2010, double what it was in 2004.