It’s all change again down Mexico way as the capital’s main airport prepares to build a third terminal

9 May, 2019

The saga (not too strong a word) of the replacement airport in Mexico City that never was, having been axed by the incoming President Andrés Manuel López Obrador ('AMLO') following a referendum and at a cost of USD5 billion, took another turn at the end of Apr-2019. An announcement from Grupo Aeroportuario de la Ciudad de Mexico, which manages it, revealed the planned construction of Terminal 3 at the city's long serving and severely capacity-constrained Benito Juarez International airport.

The project should commence as early as 2020 and it could be ready by 2024. The current presidential hangar will reportedly be the location of Terminal 3, which would be true to the socialist form of the office holder.

Previously, AMLO had indicated that there would be a three-pronged approach to filling the gap left by the cancellation of the new USD11 billion airport: improvements to Juarez; conversion of the Santa Lucia airbase from a military airfield; and greater use of the privately managed Toluca Airport, to the west of Mexico City.

As The Blue Swan Daily has mentioned several times previously, passenger traffic growth has stabilised and then fallen over the last five years or so at Juarez International but this is largely due to capacity issues (no matter how constrained most airports can usually demonstrate some growth if only from the deployment of larger aircraft, even if the runways are at 97% utilisation, as they are here).

CHART - After a strong performance during the first half of the decade, annual passenger growth levels have slowed at Benito Juarez International airport since 2015Source: CAPA - Centre for Aviation and Mexico City Juarez International Airport reports

The airport has two long runways, each of almost 4000 m, but if a new terminal is to be built then the absence of any comment on future runway provision seems a little strange. There have been as many as five of them, the other three being closed at one time or another by Presidential decree.

Juarez International is unusual for a capital city airport in that almost half the seat capacity is on low-cost carriers (LCCs), which poses the question as to what mode of airline operator the new terminal will be targeted at.

As it happens it appears that the terminal is to be used for arriving passengers only, to ease congestion at the other two terminals, but that also means repositioning of the aircraft later unless departing passengers are taken to the aircraft docked at the new terminal by bus from the existing facilities.

It also seems as if this third terminal is not the end of the new building. There is also to be a fourth terminal although the timescale is not known.

The other change is that contracts have been signed with NAVBLUE and ADPI (part of Groupe ADP) to develop a master plan, ATM and operational charts for the USD4.5 billion Santa Lucia Airbase conversion project to the north of Mexico City. It will be named after Felipe Ángeles, a military hero of the Mexican Revolution. AMLO has claimed that the project will not have cost overruns and will be complete by Jun-2021, well in advance of the new Juarez International terminal

ADPI was awarded a MEX45.9 million (USD2.4 million) master plan development contract. Nav-Blue was awarded a MEX117.5 million (USD6.2 million) contract for ATM and operational charts. Phase I of the project includes three runways and 20 million passengers per annum capacity with the potential for 80 mppa. The airfield currently has one runway, of 3,500 m, and again it seems a little strange to be going from one to three while not making any provision for additional runways at Juarez International.

The project is estimated to require 28% of the total cost outlay of the abandoned new airport to develop. Mexico's Environment and Natural Resources Secretariat has not yet authorised the Santa Lucia conversion project, setting back AMLO's plans for a ceremony to commence work on 28-Apr-2019. He now says: "The construction will commence in Jun-2019, once we have all the requirements".

The government seems to be treating Santa Lucia as a long-term project, with the tacit belief that it can achieve these passenger targets, which ultimately would make it as large as the abandoned new airport. As it does so costs will spiral, despite what AMLO thinks and even if the military is the contractor.

With growth forecasts suggesting it could reach saturation within 10 years, traffic split between at least two airports and with some potential ATC overlap, it begs the question, would it not have been better just to stick with the new airport, which was well under way when abandoned? As for Toluca, there is no new news on how development of that airport will progress and it runs the risk of being the bridesmaid in all this.