Changi Airport races to build T5 amid Asia’s aviation boom

[SINGAPORE] Changi Airport must press ahead with the construction of Terminal 5 if it intends to remain competitive against major Asia-Pacific airports that are ramping up capacity to meet surging demand, a top official from a global airport association has said.

Singapore “cannot afford to lose more time if it wants to retain its position” as the world’s leading airport, said Mr Stefano Baronci, Director-General of Airports Council International (ACI) Asia-Pacific and Middle East, during a media briefing at Jewel Changi Airport on May 13.

Mr Baronci, who is based in Bangkok, emphasized that maintaining Changi’s high service standards and strengthening collaboration with the government and stakeholders would be essential to ensure the success of T5. He highlighted the importance of expanding airline connectivity and attracting inbound travel in order to secure Changi’s edge.

The urgency stems from projections that global air travel demand will double by 2040, with the Asia-Pacific region expected to lead this growth. ACI forecasts the region will account for nearly 40 per cent of global passenger traffic by then, adding pressure on hubs like Singapore to enhance infrastructure or risk falling behind. The city-state’s strategic role as a regional hub further heightens the need to move quickly.

ACI Asia-Pacific and Middle East represents 127 airport operators managing 604 airports across the region. After delays caused by the Covid-19 pandemic, construction of Terminal 5 is slated to begin in mid-May.

Rising Competition from Regional Hubs

Mr Baronci pointed to significant developments at competing airports. Hong Kong International Airport (HKIA), for instance, has already launched a third runway and is expanding Terminal 2, due to open in 2025. HKIA aims to increase its annual capacity from over 70 million to 120 million passengers by the mid-2030s.

In Bangkok, Suvarnabhumi Airport opened a new satellite terminal in March 2025, pushing its capacity to 60 million passengers per year. The addition of a third runway and a new South Terminal is expected to increase capacity by a further 70 million, taking the airport’s total to 130 million annually.

Seoul’s Incheon International Airport completed a major expansion in 2024, including the addition of a fourth runway, enabling it to accommodate over 100 million passengers a year.

This puts airports like Incheon on track to join the ranks of so-called "mega airports"—those capable of handling more than 100 million passengers annually. According to 2024 ACI data, there are currently 10 such cities globally, including three in Asia: Beijing, Tokyo and Shanghai.

Bangkok and Seoul, both operating dual-airport systems—Don Mueang and Gimpo respectively—saw passenger volumes of around 93 million and 94 million in 2024.

Changi Airport, by comparison, handled 67.7 million passengers that year. While Hong Kong processed 53.1 million and Suvarnabhumi reached approximately 62.2 million, Incheon recorded a new high with 70.67 million international passengers.

Despite trailing some peers in passenger numbers, Changi consistently ranks among the top airports globally for service and efficiency. However, experts caution that a strong reputation may not be enough as competition intensifies.

“The challenge for Changi lies in scaling up while preserving the passenger experience that has defined its brand,” said an aviation consultant during the briefing.

When completed in the mid-2030s, Terminal 5 is expected to add capacity for 50 million more passengers annually, boosting Changi’s total to 140 million and officially placing it in the mega airport category, Mr Baronci noted.

Tariffs and Geopolitics Pose Broader Risks

On broader issues facing the aviation sector, Mr Baronci said the impact of U.S. tariffs—previously introduced under former President Donald Trump—will likely first affect air cargo.

“The cargo sector will inevitably be impacted by tariffs,” he said. The impact on passenger travel, however, is more uncertain, as various factors such as airfare pricing influence passenger decisions.

This comes amid a thaw in U.S.-China trade tensions. On May 12, both nations agreed to reduce tariffs and resume trade negotiations, lifting market sentiment and easing concerns of a global economic downturn.

The aviation industry showed resilience during the U.S.-China trade war in the late 2010s, with passenger volumes continuing to grow despite higher costs. Still, Mr Baronci warned that airlines remain susceptible to fuel price volatility and supply chain constraints, which could amplify the effects of any new trade barriers. “The key is adaptability,” he said, pointing to how airlines successfully rerouted cargo flights in previous disruptions.

Geopolitical instability poses an even more immediate risk, Mr Baronci noted. Conflicts such as those between Russia and Ukraine, Israel and Palestine, and India and Pakistan have already disrupted flight operations.

In South Asia, recent tensions between India and Pakistan forced carriers to alter flight paths—either north or south—leading to longer journey times, increased congestion, and higher operating costs.

Asia Set to Lead Airport Growth

ACI anticipates that most of the world’s future mega airports will emerge from Asia, driven by economic growth, urbanization, and population expansion. Of the 39 megacities globally—defined as cities with more than 10 million people—25 are in Asia, including Delhi, Tokyo, Manila, Dhaka and Shanghai.

“The epicentre of aviation is shifting to Asia,” Mr Baronci said. Airports across the Asia-Pacific and Middle East have collectively committed US$240 billion (S$313 billion) over the next decade to expand and upgrade infrastructure, according to ACI.

“A new cycle of investment has begun in this region,” Mr Baronci concluded. “The key message is that uncertainty should not lead to retreat, but should be a catalyst for construction, diversification and innovation.”