Impact of Price Regulation on Airport Charges

priceAirport Charges and Price Regulation in Germany

As part of the master program Transport and Supply Chain Management (TSCM) at VU University in Amsterdam I did a thesis research concerning the impact of price regulation on airport charges.The research was aimed to provide an answer to the literature discussion whether airports have the incentive to charge excessive tariffs and if they do so whether price regulation is the right method to avoid this incentive. Results and insights gained from the thesis research will be treated in this article.
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Airports Developing Air Services for Cargo versus Passenger Airlines

klm-cargoOver the years Air Service Development has developed into a valuable tool for airports to keep their fate into their own hands. By actively providing air service analyses to airlines,airports are able to expand their client and route portfolio. Besides actively targeting passenger airlines also cargo airlines are being targeted by airports. At the yearly held World Route Development Forum airlines are approached by airports in attempts to convince airlines of flying to their respective airports. This paper provides an overview of the differences in approaching cargo airlines versus passenger airlines. Besides, for sure, cargo plays a contributing role in the revenue generation of passenger airlines, once a passenger airline has decided to start operating a route. The majority of the information provided is from experience of the author, having done passenger and cargo air service development for airports, amongst others: Amsterdam, New Delhi and Cologne Bonn.

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Networks in Aviation – Strategies and Structures

networks-in-aviationWith this book one can discover the main aspects of an airline’s network structure. It iswritten clearly, which allows also people without profound knowledge about network managementto understand the topics adequately. The book is, however, also interesting formanagers in the industry: the preface written by Dr.Christoph Franz (CEO of Lufthansa) welcomes readers. Since Lufthansa Group serves more than 270 destinations under variousbrand names such as Lufthansa, Swiss, Austrian, bmi, Brussels Airlines, and Germanwings, Dr.Franz’s foreword is symbolically important.

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Ethical Issues in Aviation

ethical_issuesThe book is dedicated to the first 7 students who have completed the Aviation Ethics course at Lewis University. This emphasizes the need to explicitly incorporate ethics in education and training. As such, the book is a novelty in its kind and provides a unique opportunity for aviation students, scientists and practitioners to get explicitly acquainted with ethics in aviation beyond the level of codes of conduct, normative behavior and anecdotic, operational dilemmas.

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Variances in Airline Ticket Prices

variances airline ticket pricesLiberalization and deregulation has led to profound changes the airline industry. Diminished governmental influence stimulated airlines to increase their revenues gained by the sales of tickets. Nowadays, airlines issue tickets that are characterized by a great diversity of restrictions to achieve demand segmentation. Most of the current airlines apply complex revenue management systems to determine their ticket prices. These widely applied systems enable airlines to maximize their seat inventory as well as optimizing the charged price for each customer segment. Basically, airlines are charging a wide range of fares to a great diversity of customers for – what is in essence – an identical product.

This paper aims to illustrate the effect of market concentration and competitive forces on the airline ticket price variance. In addition it provides insight in the main drivers causing ticket prices to disperse. Potential groups of interest for this paper include aviation professionals,students and airline passengers, will gain a thorough understanding of the fundamentals in ticket price variances.

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The European Commission Appraisal of Airline Mergers

airline mergersAirliners intending to implement mergers witheconomic effects in the EU aviation transportmarkets have to seek the previous authorizationof the European Commission under the EuropeanMerger Control Regulation (EMCR). Since 1989the Commission blocked two airliners mergers (Ryanair/Aer Lingus, Case M.4439 and Olympic/Aegean Airlines, Case M.5830) and conditionally cleared many more by agreeing with the parties on remedies to fix the expected competition problems. The commonest remedy is the divestiture of landing and taking off airport slots, although the effectiveness of these remedies was questioned because in some cases no competitors used the freed slots. The purpose of this article is to discuss the Commission policy on slot remedies. In particular, it focuses on the questions whether slot remedies are effective tools to resolve the competition problems arising out of airline mergers and which elements should be included in slot remedy packages in order to enhance their effectiveness. These are questions of practical relevance given the cautious approach of the Commission in clearing mergers on the basis of efficiency defence. Thus, offering a set of suitable remedies to restore competition may be the only way for the merging parties to obtain the go-ahead from the Commission for a problematic merger.
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Assessing the Efficacy of Dynamic Adaptive Airport Planning

planningAirport Strategic Planning focuses on the development of plans for the medium–term and long-term development of an airport. Strategic planning can be done in many different ways. For airports, the dominant approach is Airport Master Planning, which results in a static plan that fails if the future turns out to deviate from the future anticipated during the development of the plan. To better cope with uncertainty, flexibility and adaptivity in the plans is necessary. However, how efficacious are such adaptive plans as compared to the more traditional static rigid plans? Using computational techniques, we find that only in a very narrow range of plausible futures a rigid plan performs better than the adaptive plan.
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