Mumbai, Maharashtra, India
Airport security in the Asia Pacific is attracting increasing attention as governments in the region face intense pressure from countries such as the United States to comply with international standards and regulations.
"As low-cost carriers experience unprecedented success in Asia Pacific, there are massive expansion plans in airport construction and new air infrastructure projects. These factors create significant opportunities in the airport security equipment (ASE) space," remarks Financial Analyst Rani Cleetez.
New analysis from Frost & Sullivan's Business & Financial Services Group (http://www.aerospace.frost.com): the Asia Pacific Airport Security Equipment Market - Investment Analysis and Growth Opportunities reveals that the Asia Pacific ASE market (top 38 participants) generated revenues of $3.04 billion in 2004 and are likely to reach $10.95 billion in 2009.
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Passenger air traffic is also on the rise in Asia Pacific and grew by a substantial 30 percent from 2004-2005. This growth pushes governmental bodies to continuously increase expenditure on aviation security. The Civil Aviation Authority (CAA) spent the bulk of its budget in major Asia Pacific countries, 87.3 percent in 2005.
Countries with the highest growth potential include: China, India, Japan, Indonesia, Thailand and South Korea. The markets in India and China are particularly promising with government spending on ASE reaching approximately $125 million and $1 billion respectively in 2004.
Government plans in India are to not only undertake significant airport upgrades with a special focus on ASE, but also build three new international airports in Bangalore, Goa and Hyderabad. The government has allocated more than $10 billion for this upgrade program alone.
Similarly, airport security has become a critical safety issue for the Chinese government, with heavy investment plans to address the ever-present threat of terrorism in air travel. Estimates are that China will construct 108 new airports in the next five years, for a total of 240 by 2010.
"While these changes clearly point to a bright future for ASE vendors, the sustainability of the ASE industry is very much dependent on continuous research and development (R&D) activities resulting in technology upgrades," notes Cleetez. "In fact, the U.S. Transportation Security Administration (TSA) considers this an important factor for the certification of companies."
This Frost & Sullivan study of 23 listed ASE companies' reveals that the top ten companies account for almost 65.5 percent of total R&D expenditure. This poses a significant challenge to the smaller companies to pick up the pace and invest larger amounts in R&D to ensure survival in an increasingly competitive market.
Asia Pacific Airport Security Equipment Market - Investment Analysis and Growth Opportunities, part of the Financial Benchmarking and Analysis in the Aerospace Industry Subscription, provides the three main investment themes in the market as well as financial and geographical analyses that help depict a clear picture of the market. In this research service, Frost & Sullivan's expert analysts thoroughly examine the following ten countries closely: India, China, Japan, Australia, Hong Kong, Singapore, New Zealand, Thailand, Singapore, and Indonesia. Interviews are available to the press.
Frost & Sullivan, a global growth consulting company, has been partnering with clients to support the development of innovative strategies for more than 40 years. The company's industry expertise integrates growth consulting, growth partnership services, and corporate management training to identify and develop opportunities. Frost & Sullivan serves an extensive clientele that includes Global 1000 companies, emerging companies, and the investment community by providing comprehensive industry coverage that reflects a unique global perspective and combines ongoing analysis of markets, technologies, econometrics, and demographics. For more information, visit www.frost.com.
Samantha Unnikrishnan, Frost & Sullivan, +91 (44) 4204 4667 sunnikrishnan@frost.com
Surbhi Dedhia, Frost & Sullivan, +91 (22) 50013431 sdedhia@frost.com
Source: Frost & Sullivan (Business Wire India)
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