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The smart baggage handling solutions market size is forecast to increase by USD 5.04 billion, at a CAGR of 14.36% between 2023 and 2028. The market is expanding due to the growing need for efficient baggage operations at airports and railways. The development of smart airport concepts is driving investments in advanced baggage handling technologies. Airports and railway stations are adopting automated systems to improve efficiency and enhance passenger experiences. Additionally, the growing need for M2M (Machine-to-Machine) integration (M2Mi) is fueling the deployment of sophisticated tracking and tracing solutions. These technologies enable real-time data exchange and seamless operations, addressing the increasing passenger traffic and security concerns. The integration of artificial intelligence-powered cloud software and digital solutions further optimizes sorting, conveying, and diverting processes, ensuring smooth baggage operations in modern transportation hubs.
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Our researchers analyzed the market research and growth data with 2023 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.
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.
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.
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.
The market forecasting 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 market growth and forecasting strategies.
Market Customer Landscape
Companies 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 key offerings of the company include smart baggage-handling solutions.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of companies 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 companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies 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 2.35 billion in 2018. Most airports are investing in integrating Wi-Fi, beacon, Bluetooth, and cloud services to provide baggage information to passengers and speed up the luggage collection process at the 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 luggage 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 40% 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 luggage 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.
Segment Overview
The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024-2028, as well as historical data from 2018 - 2022 for the following segments.
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The market is driven by several key factors. Increasing concerns over terrorist attacks and global terrorism have led to the adoption of technically sophisticated scanners in the security and surveillance industry. Airports are investing in automated baggage handling systems to enhance airport operating efficiency and manage rising passenger traffic. Artificial intelligence powered cloud software and digital solutions are being integrated to improve tracking and tracing, sorting, and conveying processes in the baggage hall. Airport operators are focusing on smart baggage handling system industry advancements to streamline check-in area, immigration, and border control operations. The adoption of these technologies extends to intermodal transportation systems like trains and railway stations, boosting the efficiency of baggage handling technologies across various sectors. However, challenges include high implementation costs and the need for robust infrastructure.
Additionally, the market is driven by the adoption of Radio Frequency Identification (RFID) and Internet of Things (IoT) technologies, enhancing loading area operations for aircraft and airplanes. Initiatives like smart city initiatives and advanced public safety procedures are critical in addressing luggage mismanagement and reducing luggage mishandling. The use of smart baggage handling systems companies, baggage handling equipment, and self-service luggage drop systems improve passenger satisfaction and reduce lost luggage instances. Technologies such as face recognition and barcode technology in the Conveying segment optimize efficiency. Moreover, smart baggage tags, Smart Baggage and Tracking Devices, and Smart Baggage Screening Technologies are vital in the security and investigation industry. Enhancements in airport ground support personnel practices contribute to lowering carbon emissions and improving passenger satisfaction at Railway Stations and airports, despite challenges from the unstable market and financial sector.
Market Scope |
|
Report Coverage |
Details |
Page number |
163 |
Base year |
2023 |
Historic period |
2018 - 2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 14.36% |
Market Growth 2024-2028 |
USD 5.04 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
12.26 |
Regional analysis |
APAC, North America, Europe, Middle East and Africa, and South America |
Performing market contribution |
APAC at 40% |
Key countries |
US, China, Japan, France, and Germany |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
ADB Safegate BV, Alstef Group SAS, 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, RTX Corp., SC SELF TRUST SRL, Schneider Electric SE, SEETEK SA, Siemens AG, SITA, and Vanderlande Industries BV |
Market dynamics |
Parent market growth analysis, Market forecast, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period. |
Customization purview |
If our market report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Type
7 Market Segmentation by Technology
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Opportunity/Restraints
11 Competitive Landscape
12 Competitive Analysis
13 Appendix
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