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Fitch: Federal Grants Ease Airport Capital Strains

Airports’ cost per enplanement and debt levels are expected to continue to rise, according to Fitch, although the recent round of Federal Aviation Administration grants from the Bipartisan Infrastructure Law will curb the impact.

“We expect that airports’ cost per enplanement and debt levels will continue to rise at major market airports undertaking capital projects, as federal funding will only defray only a portion of the total costs,” Fitch said in its latest analysis. “Fitch believes airport cashflow and liquidity profiles will remain solid in 2023 and following years, given the broad political and financial support for airport improvements, and stronger airline industry positioning due to positive travel trends.”

U.S. airport traffic has essentially recovered to pre-pandemic levels, contributing to strong airport financial profiles, although Fitch noted that the size and scale of needed capital investments remains a significant ongoing budget pressure and were a key factor in its analysis.