Issue 42

Surviving the Fuel Crunch: a Review of Available Operating Cost Reduction Measures

By Bridget Ssamula

The aviation industry is facing a looming crisis with spiraling fuel costs. For the first time ever, fuel replaced labor as the largest single cost item for the global airline industry in 2006. Based on a sample of the financial reports of 45 major global (passenger) airlines, fuel accounted for 25.5 per cent of total operating costs in 2006, up from 22.5 per cent in 2005. The rise in the fuel price reflects a sharp increase in the price of crude oil over the period, but also reflects a widening in the refinery margin between crude oil and jet fuel, largely due to capacity constraints at refineries. The widening of the refinery margin alone added an extra US.7 billion to the industry’s fuel cost in 2006. IATA shows that jet fuel prices have increased by 100 per cent based on April 2007 week’s prices. (IATA, 2007)

Noise Disruptions at Barcelona Airport (ongoing PhD Research)

By Pere Suau-Sanchez In this paper

Pere Suau-Sanchez highlights the importance of environmental capacity of airports, using a more detailed analysis of the Barcelona case and its local complexity. The chronology of events that have arisen since the opening of the new third runway is explained with special emphasis being placed on the relation between external territorial factors and internal airport dynamics. The article concludes with the future perspectives for the airport, and highlights the urgency for thinking how this infrastructure should be enlarged.

The dilemma of noise pollution: Commentary on Alders Roundtable

By Hans Heerkens In the Netherlands, the parties that determine the future of the national hub Schiphol Airport have been wrestling for decades with the dilemma that growth means more noise pollution, at least in the short term. In a new effort to reconcile the irreconcilable, the Dutch Cabinet asked former minister Hans Alders to devise a plan for making future controlled growth of the airport possible, and to do this in co-operation with interested parties such as the airport and inhabitants of the surrounding municipalities. Last October, this ‘Alders-table’ delivered its report. Highlights are that Schiphol should be allowed to grow to 510.000 aircraft movements in 2020 (430.000 in 2007) and that the present legally set noise control instruments be replaced by a constellation of agreements between the airports and the people living around it.

Locked-in Logistics (PhD thesis)

By Dr. Pim Warffemius This paper is about the agglomeration effect of Amsterdam Airport Schiphol and its implications for location policy regarding the airport region. We focus on a specific case, namely the important concentration of European Distribution Centers (EDCs) around the airport. The traditional answer to the question why EDCs are attracted to the airport is due to the importance of having air transport services at their disposal. However, we show that this is only a partial answer and that economies of agglomeration are the most important determinants. Moreover, we show that the spatial economic development of the airport area needs to be accompanied by new insights concerning location policy. This article is part of the collaboration between Aerlines Magazine and the Dutch Ministry for Housing, Spatial Planning and Environment (VROM).

Book review: The Impact of EU Law on the Regulation of International Air Transportation

By Dr. Pablo Mendes de Leon

Dr. Martin Bartlik wrote this book in 2007, a year that is marked by a number of fascinating developments in international civil aviation. As far as his study is concerned, the EU-US air transport agreement came into effect on 30 March 2008, marking a new era in international aviation relations. On the intra-Community side, proposals are underway for the establishment of a new, integrated internal market regulation, which will replace the regulations that have served so well during the past 16 years.


Book Review: Aviation markets – Studies in Competition and Regulatory Reform

By Steve Holloway

The book is a compendium of 17 papers, lectures, and submissions written or co-written over the last quarter of a century by a well-known and widely respected transport economist. Its purpose is to shed light on a single theme: the potential for market mechanisms to contribute to the resolution of economic policy issues confronting aviation industry regulators. –

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