Baggage Handling System Market

Market Overview

The baggage handling system market reached a value of USD 8.55 billion in 2019 and is anticipated to expand to USD 21.52 billion by 2032, registering a CAGR of 6.8% over the forecast period. In 2019, Asia Pacific held the largest market share at 36.25%. This system is responsible for moving checked baggage from the initial counter to locations where passengers can retrieve their luggage for storage or final pick-up. The key stakeholders in this process include passengers, airline companies, airports, security personnel, and baggage-handling agents.

MARKET TRENDS

Renovation of Airports across the Globe is Upholding Market Growth

The increase in the number of airports worldwide can be attributed to the increasing popularity of air travel. The modernization of airport facilities through the incorporation of advanced technologies like RFID-enabled baggage handling systems and AI-powered robotic baggage handlers is a key factor driving the expansion of air transportation. For example, in June 2016, SITA introduced Leo, a self-propelled baggage robot capable of carrying up to 32kgs, at Geneva Airport in Switzerland. Additionally, in 2019, Smiths Detection Group Ltd. secured a contract worth around USD 70 million with the Transportation Security Administration (TSA) to install luggage handling systems throughout the United States. Furthermore, new airlines have entered the market, such as Zoom Air in India, which commenced operations in February 2017 with services limited to select Indian cities, leading to an increased demand for baggage handling equipment. As a result, the modernization of airports globally is driving market growth.

Baggage Handling System Market

Size, by Product, - (USD Billion)

Airport

Railway Station

Other Products

The Market will Grow

At the CAGR of:

6.5%

The Forecast Market

Size for in USD:

$21.52 billion B

MARKET DRIVERS

Sudden Increase in Passengers Travelling via Airways to Swell the Market

The International Air Transport Association (IATA) has forecasted that the number of airline passengers will reach 8 billion by 2037. The rise in air travel is due to factors like economic growth, demographic changes, and increased household incomes. To meet this demand, airports are investing heavily in improving baggage handling systems and enhancing customer experience. For instance, in March 2018, the Chicago City Council approved an $8.5 billion expansion plan for airport renovations, including terminal upgrades and gate additions. This surge in air travel is propelling the market's growth.

MARKET RESTRAINT

Manufacturers are making significant investments to improve the level of service provided to their customers. However, the advancement of technology necessitates additional investments in terms of innovative baggage transport infrastructure. The railway industry is currently facing a challenge when it comes to investing in intelligent baggage handling systems due to factors such as a large number of passengers and inadequate security measures. This situation calls for improved luggage handling facilities, which in turn requires substantial financial resources. Moreover, airports are confronted with the sudden breakdown of baggage handling equipment, which poses a challenge to the overall airport infrastructure. Sudden breakdowns can occur as a result of operating system failures, network failures, power outages, or improper usage. If any of these failures occur, the system will be unable to carry out its processes automatically.

Considering all of these factors, both airport authorities and government entities need to invest more in order to enhance the efficiency of baggage handling equipment on a global scale. High Investment Required for Advanced Luggage Management Systems to Hamper Market Growth.

Baggage Handling System Market

Share, by end user, (USD Billion)

10.55 Billion%

Sorting

Conveying

Tracking and Tracing

Diverting

Other End-Users

21.52 billion

Total Market Size

USD (Billion),

6.5%

CAGR

-

KEY INDUSTRY PLAYERS

• Vanderlande Industries
• Siemens
• Daifuku Co., Ltd.
• BEUMER GROUP
• Pteris Global Limited
• SITA
• Fives
• Babcock International Group PLC
• Smith’s Detection Group Ltd.
• G&S Airport Conveyor
• B2A Group
• Logplan

Baggage Handling System Market Segmentation

Segmentation by type

• Airport
• Railway Station

Segmentation by application

• Sorting
• Conveying
• Tracking and Tracing
• Diverting
• Other

Mode of Transport

• Airport
• Marine
• Rail
• Solution

Check-In

• Screening and Loading
• Conveying and Sorting
• Unloading and Reclaim

Check-in Services

• Assisted Service
• Self-Service

Conveying

• Conveyor
• Destination Coded Vehicle

Tracking

• Barcode

• Radio Frequency Identification (RFID)

  Baggage Handling System Market

  Size, by Product, - (USD Billion)

  The Market will Grow

  At the CAGR of:

  6.5%

  The Forecast Market

  Size for in USD:

  $21.52 billion B

  

Recent Developments 

2021

• Stansted Airport Upgrade: The UK's Stansted Airport completed a £70m upgrade, installing 2.4km of conveyor belts and 180 automated carts, enhancing efficiency and speed.
• Beumer Group Innovations: The Beumer Group introduced significant enhancements, such as a low-energy automated system at Stansted Airport and partnering with the startup Codept for a cloud-based logistics platform.
• Siemens Developments: Siemens launched the SINAMICS G115D, a drive system for conveyor applications, and enhanced the baggage handling system at Bergamo Airport, improving capacity by over 50%.

2022

• Siemens Logistics was awarded a major order to modernize the baggage handling system (BHS) at Terminal 1 KL International Airport in Malaysia.
• Digitalization and Collaboration: Siemens Logistics emphasized digitalization for simplifying airport processes, introducing the Aviation Data Hub for data exchange among various airport stakeholders.
• Advanced Robotics and AGV Technology: Companies like Alstef and Vanderlande focused on advanced robotics and Automated Guided Vehicles (AGVs) to address staff shortages and improve efficiency.
• Self-Service and Predictive Maintenance: Self-service bag drops and AI-based predictive maintenance solutions like Alstef’s BagXpert were increasingly adopted.

2023

Modular Systems and ICS Technology: Beumer Group highlighted the adoption of Individual Carrier System (ICS) technology in major airports, offering scalable, flexible, and energy-efficient solutions.

• Automated Shuttle-Based Systems: Vanderlande introduced the Adapto Bagstore, a shuttle-based system with built-in sorting capabilities.

• Global Expansion and Innovation: Siemens Logistics was involved in modernizing systems at major international airports like Kuala Lumpur, contributing advanced technologies like VarioTray and BagIQ Control Suite.

  Baggage Handling System Market TO (USD BN)

  

  CAGR OF

  6.5%

  Baggage Handling System Market

  

  21.52 billion%
                                                          

Conclusion

The baggage handling system market is experiencing significant growth driven by the rising number of air travellers, technological advancements, and airport modernization initiatives. With the integration of RFID technology, AI-powered robotics, and other innovative solutions, airports are enhancing their efficiency and customer experience. However, challenges such as the high cost of advanced systems, the need for standardization, and compatibility issues persist. To maintain this growth trajectory, it is crucial for industry players and government authorities to invest in reliable, scalable, and efficient baggage handling infrastructure. Key industry players, through continuous innovation and strategic partnerships, are well-positioned to capitalize on these opportunities, ensuring that baggage handling systems keep pace with the evolving demands of the global travel industry.