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The smart baggage handling solutions market is estimated to grow at a CAGR of 12.15% between 2022 and 2027. The size of the market is forecast to increase by USD 3,664.41 million. The growth of the market depends on several factors, including the growing need for efficient baggage operations at airports and railways, the development of smart airport concepts, and the growing need for M2Mi.
This report extensively covers market segmentation by type (smart baggage tracking devices and smart baggage screening devices), technology (barcode system and RFID), and geography (APAC, North America, Europe, Middle East and Africa, and South America). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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Technavio categorizes the global smart baggage handling solutions market as a part of the global electrical components and equipment market within the global electrical equipment market. The parent market, the global electrical components, and equipment market covers companies engaged in the manufacturing of electric cables and wires, electrical components, and electrical equipment. Our research report has extensively covered external factors influencing the parent market growth during the forecast period.
The development of smart airport concepts is notably driving market growth, although factors such as the scarcity of skilled resources to operate these advanced systems may impede the market growth. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Key Smart Baggage Handling Solutions Market Driver
The development of smart airport concepts is notably driving market growth. With the increasing popularity of agile airport infrastructure, coupled with the growing investments in technological advancements, the concept of the smart airport has been jointly proposed by the IATA and ACI. Under the smart airport approach, all systems are integrated into one single digital grid, which allows the sharing of real-time information and deep cross-silo collaboration. This eventually results in enhanced operational efficiencies and a superior passenger experience, as well as an uninterrupted delivery of a comprehensive array of personalized services to the passengers.
Smart airport terminals are developed around a single, converged IP platform that enables high-speed broadband traffic across the aerodrome. By allowing real-time data exchange and airport-wide integration, smart airports significantly improve their operational efficiencies, passenger services, and security capabilities. Increased demand for air travel has made the regulatory authorities, including ICAO, IATA, Federal Aviation Administration, European Aviation Safety Agency, Civil Aviation Safety Authority, and the EU, encourage the development of smart airports. Such an approach will minimize the risks and limit the inconvenience to passengers, thereby enabling safer flight and airport operations. Thus, such factors will drive the growth of the SBH solutions market during the forecast period.
Significant Smart Baggage Handling Solutions Market Trend
The emergence of robotic baggage handling is a major trend in the market. Airports, marine lines, and railways are gradually adopting significantly sophisticated technologies and implementing them across the entire baggage-handling ecosystem. With the continuous advancements in robotics and digital communications, airports are emerging with new technologies for enhancing the passenger travel experience.
The partnership between Grenzebach Automation and Vanderlande at Amsterdam Airport Schiphol can be cited as an example. The companies together developed an Integrated Robot Loading concept, which is a robotic system that employs AI to replace manual labor for baggage handling. This new upgraded system provides one central storage facility where all checked-in and transferred baggage can be moved. The robotic arm at this storage facility automatically loads containers and ramp carts. Thus, such factors drive the growth of the SBH solutions market during the forecast period.
Major Smart Baggage Handling Solutions Market Challenge
The scarcity of skilled resources to operate these advanced systems is a major challenge impeding the market. Though artificial intelligence (AI) can be a valuable tool for anomaly detection, logistics optimization, and customer service management, it requires many resources to perform well on a continuous basis. AI is in its infancy at present and is undergoing rapid improvements. This signifies that not all firms are equipped with the infrastructure required to harness the true potential of machine learning and other advanced concepts offered by AI. This indicates the limited reach of the concept, as only a few organizations wish to invest in the development of these skills among their personnel. Additionally, the domain is also not well represented in industry-focused education and training curricula.
Moreover, the lack of human resources in an organization limits its vision of machine-powered progress in the real world. Since top recruiters such as Amazon, Google LLC (Google), and Microsoft Corp. hire AI professionals in large numbers at lucrative salary packages, the other companies are bound to face issues in obtaining the required talent. This forces the players in other industries, such as aviation, to adopt AI-driven technologies on a service basis, hindering the development of in-house capability. Therefore, such factors will hinder the growth of the global SBH solutions market during the forecast period.
Key Smart Baggage Handling Solutions Market Customer Landscape
The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Smart Baggage Handling Solutions Market Customer Landscape
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Alstef Group - The company operates under one segment. The company under this segment offers solutions for baggage handling, intralogistics solution, and parcel sortation. The key offerings of the company include smart baggage-handling solutions.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market share growth by the smart baggage tracking device segment will be significant during the forecast period. Smart baggage management refers to the tracking of bags using a range of RFID tags, a global positioning system (GPS)-enabled devices, Wi-Fi, cellular baggage tags, and baggage tracking devices. RFID bag tags are one of the major elements that have drawn significant investments from airlines, and airports have been introduced in numerous baggage handling operations. These electronic tags allow baggage to be tracked, enhancing overall baggage handling solutions. Some airlines are also launching electronic home-printed bag tags, which have a great acceptance rate from customers
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The smart baggage tracking device segment was valued at USD 2,142.87 million in 2017 and continued to grow until 2021. Most airports are investing in integrating Wi-Fi, beacon, Bluetooth, and cloud services to provide baggage information to passengers and speed up the baggage collection process at the baggage claim area. Among the aforementioned technologies, the adoption of beacon technology has witnessed a special interest. Furthermore, the growing need for trackable luggage throughout a journey has created a scope for new start-ups and established companies to develop smart luggage that is integrated with SIM cards, Wi-Fi hotspots, Bluetooth, and GPS. AWOL designed a type of smart baggage with a tracking device that shuts down when the bag is boarded onto a flight and turns on upon landing, thereby complying with the regulations of not using wireless technology on board. Such new innovations in luggage also propel the market to a considerable extent.
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APAC is estimated to contribute 38% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
The key countries that are driving the regional market are India and Japan. For instance, in March 2018, SITA secured a contract from the Airports Authority of India (AAI) for the implementation of SITA's BagManager baggage-management solution at 15 airports in India. To enhance passengers' travel experience, airlines also focus on offering efficient baggage handling services. In December 2017, the Taoyuan International Airport Corp. (TIAC) awarded Vanderlande a contract to supply state-of-the-art baggage handling systems to its new terminal. For this project, Vanderlande has formed a consortium with its local partner KENMEC MECHANICAL ENGINEERING Co., Ltd. Upon completion, SBH solutions will offer a maximum capacity of 19,200 bags per hour, and all terminals will be interconnected with the automated individual carrier system, TUBTRAX. Therefore, such factors will boost the regional market growth during the forecast period.
In 2020, the COVID-19 pandemic significantly affected the regional market. However, with an improvement in the COVID-19 situation, businesses were back on track leading to more travel opportunities in 2021, and the market in APAC slowly gained momentum. Moreover, the initiation of large-scale vaccination drives resulted in the restoration of operations across offline distribution channels, which has increased the demand for SBH solutions in the region. Hence, such factors are expected to drive the growth of the regional market during the forecast period.
The report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027. The market has been segmented by Type (Smart baggage, tracking devices, and Smart baggage screening devices), Technology (Barcode system and RFID), and Geography (APAC, North America, Europe, Middle East and Africa, and South America).
Smart Baggage Handling Solutions Market Scope |
|
Report Coverage |
Details |
Page number |
163 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 12.15% |
Market growth 2023-2027 |
USD 3,664.41 million |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
11.47 |
Regional analysis |
APAC, North America, Europe, Middle East and Africa, and South America |
Performing market contribution |
APAC at 38% |
Key countries |
US, China, Japan, France, and Germany |
Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
Key companies profiled |
ADB Safegate BV, Alstef Group, Amadeus IT Group SA, BBHS AS, Beumer Group GmbH and Co. KG, Brock Solutions, Daifuku Co. Ltd., FIVES SAS, Infosys Ltd., Intellimodus LLC, Leidos Holdings Inc., Lenze SE, Lyngsoe Systems AS, Raytheon Technologies Corp., SC SELF TRUST SRL, Schneider Electric SE, SEETEK SA, Siemens AG, SITA, and Vanderlande Industries BV |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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