Operational efficiency of Asia–Pacific airports

Airports are important drivers of economic development and thus under tremendous pressure from emerging competitors. However, few studies have analysed the operational efficiency of Asia–Pacific airports. This study therefore evaluated the operational efficiency of 21 Asia–Pacific airports between 2002 and 2011. A two-stage method was used: Data Envelopment Analysis (DEA) to assess airport efficiency, followed by the second-stage regression analysis to identify the key determinants of airport efficiency. The first-stage DEA results indicated that Adelaide, Beijing, Brisbane, Hong Kong, Melbourne, and Shenzhen are the efficient airports. The second-stage regression analysis suggested that percentage of international passengers handled by an airport, airport hinterland population size, dominant airline(s) of an airport when entering global airline strategic alliance, and an increase in GDP per capita are significant in explaining variations in airport efficiency.     

Minimum delay or maximum efficiency? Rising productivity of available capacity at airports: Review of current practice and future needs

Around the world airports are facing capacity constraints more and more everyday, generally the runway capacities are restricted by governments and airports are unable to accept additional aircrafts. Technological improvements can decrease the necessity of policy limitations in terms of noise and air pollution. Rapidly increasing numbers of traffic developed severe scarce capacity, congestion and delay problems and the capacity that is available, needs to be allocated as efficiently as possible. Airport capacity can be allocated in different ways; administrative capacity management with slot allocation and traffic distribution rules; market-based capacity management with slot auctioning, secondary trading and peak pricing; a combination of both mechanisms; and no regulation mechanism as applied in the USA with the exceptions of busiest airports. The review contains the analysis of current state of practice and the review of relevant research on capacity and slot allocation modelling with policy and demand management perspectives. It targets identification of existing problems, inefficiencies, gaps and requirements in current practice of slot allocation mechanisms, defining options for change in policies to allocate slots more efficiently, transparent and fair by investigating market-based mechanisms. The objective of this paper is to contribute to the ongoing research for improvements to the slot allocation process that can be rationally implemented in practice in order to improve efficiency, fairness and transparency. For that purpose, based on these slot allocation approaches, we provide a critical review of status-quo, literature and current research with demand and congestion management perspectives by considering overall social welfare, airline and airport surplus, passenger welfare and explore hypothetical, computational and practical challenges that have arisen from cross-disciplinary methodologies.     

The influence of fleet mix,ownership and LCCs on airports’ technical/environmental efficiency

This paper analyses the efficiency of 33 Italian airports for the period 2005–2008. In addition to conventional outputs, differently from previous contributions, two environmental externalities are considered: noise and local air pollution. We perform a two-stage analysis. First, we implement a directional distance function (DDF) model and get airports’ efficiency scores. Then, we study the factors affecting efficiency using a bootstrapping procedure. We find that the fleet mix significantly affects technical/environmental efficiency. Moreover, we provide evidence that public airports have higher efficiency scores. Last, LCCs have no effect on technical/environmental efficiency.     

The sky is the limit? The determinants and constraints of European airports commercial revenues

This study investigates the determinants of commercial and retail airport revenues from real estate operations. Aviation revenues per passenger are mainly determined by the national income per capita in the area where the airport is located, the percentage of leisure travelers and the size of the airport. Main drivers of commercial revenues per passenger include the number of passengers passing through the airport, the ratio of commercial to total revenues, national income, the share of domestic and leisure travelers and the number of flights. These results are in line with previous findings of a negative influence of business travelers on commercial revenues per passenger. We also find that a large amount of retail space per passenger is generally associated with lower commercial revenues per square meter confirming decreasing marginal revenue effects. Real estate revenues per passenger are positively associated with national income per capita at airport location, share of intra-EU passengers and percent delayed flights.     

The privatisation of Australia’s airports

When the Federal Airports Corporation (FAC) was formed in 1988, administration of Australia’s major airports passed from a Government department to a corporatised entity. The FAC improved the performance of the airports sector and it broadened the revenue base through commercial and property development. By 1994, however, policy thinking shifted in favour of privatisation. So far, the Government has sold 17 of the FAC’s 22 airports and it has received US$2.6 billion (1998/99 values). Four of the remaining airports are in the Sydney region where there are on-going debates about an appropriate site for a second major airport.The paper describes the sales processes and presents details about the new owners, the commitments they have entered into, and the regulatory system that has been established for the post-privatisation era. Price-capping arrangements have been put into place for the major airports, but Australia also introduced legislation to ensure there is competitive access to essential infrastructure. It is too early to assess the performance of the new owners and to see how the interaction between access regulation and price capping is managed, but this paper documents the pre-privatisation situation to assist future researchers.     

Small is beautiful? The impact of economic crisis,low cost carriers,and size on efficiency in Spanish airports (2009–2011)

This paper carries out a comparative technical efficiency analysis of 35 Spanish airports using panel data for 2009–2011 with a data envelopment analysis (DEA) methodology. The results suggest that airport size has a positive impact on the technical and scale efficiency and that the presence of low cost carriers has positively affected the scale efficiency of the airports where they operate. The results also show that during the present economic crisis Spanish airports have experienced a dramatic productivity regress which is due to the reduction of their technological change component.     

Has market concentration fostered on-time performance? A case study of seventy-two U.S. airports

The study compares a multivariate with a quantile regression model to determine whether utilized airport capacity, departure and airborne delays, departure and arrival demand, and market structure explained variations in on-time gate arrivals and arrival delays. In both models, airport departure delays, arrival and departure demand explained variations in the two response variables in prioritized and non-prioritized metroplexes, holding other variables constant. After 2008, the consolidation of the airline industry through mergers coincided with the implementation of NextGen programs, which may have contributed to improvements in on-time performance, especially at prioritized metroplexes where airspace was redesigned.     

Does quality pay? The case of the dry bulk market

Following important changes in the safety regulation of tankers, the dry bulk sector is coming under the spotlight in a safety and quality perspective. Nominal freight differentiation between ‘quality’ and ‘other’ tonnage has been observed occasionally and much lip service has been paid to promoting the need for younger and safer ships. Whether or not these signals actually manifest in a market initiative for the enhancement of the standards of the world bulk carrier fleet is debatable. This paper investigates the possible existence of a two-tier spot freight market for medium and large bulk carriers of differing age. Known voyage fixtures are investigated for four representative years since the end of the 1980s, during which contrasting freight market conditions prevailed. In all but very few cases, there was no statistically significant difference between rates paid to older and younger tonnage. In those few cases where such differences were statistically significant, they never exceeded 10%.     

The difference between hub and non-hub airports – An airside capacity perspective

Airport airside capacity is limited by the runway system capacity or apron capacity, whichever is more constraining. Sometimes, taxiway system can also impose constraint to airside capacity, but in the case of fully developed taxiway systems (involving parallel taxiway, high speed exits, etc.) that is usually not an issue. To determine which airside element is more constraining it is not always as simple as comparing runway system and apron capacities directly one to another. It is important to understand and take into consideration their relationship. Runway-apron relationship depends on demand characteristics e.g. dominant market segments (e.g. scheduled, charter, low-cost, general aviation, cargo), and/or specific traffic patterns (hubbing or point-to-point services, seasonality in demand, etc.).The paper brings up the issue of available airside capacity under different traffic characteristics, faced by hubs vs. non-hub airports, and the necessity to understand runway-apron interdependency in order to properly identify the bottleneck on the airside. Referring to earlier findings related to apron capacity analysis, the paper summarizes various factors that affect apron capacity at non-hub and hub airports and uses them to define the runway-apron relationship, as well as its role in the process of analyzing airside capacity under various demand characteristics.The main finding is that functional relationship between the runway system and aprons is much stronger in the case of hub airports, and should be carefully considered when analyzing airside capacity. Besides runway capacity, few other variables that affect apron capacity at hub airports are discussed. Generic examples are used to support the discussion.     

Hello major airports,goodbye regional airports? Recent changes in European and US low-cost airline airport choice

Low-cost carriers (LCCs) are assumed to adopt a certain business model in which an important element is the concentration of services at secondary and regional airports. Yet, evidence suggests that increasingly LCCs also establish themselves in what can be considered the major airports. This raises the question of whether LCCs are changing their business model and adopting practices associated with the traditional, incumbent airlines, and if so what might cause such change. Based on categorization of airports and using OAG flight data the US and European markets are investigated. Focusing on several LCCs, with more attention given to Southwest and Ryanair, their profile of operation with respect to the type of airports used is analysed for a period of between 15 and 25 years and up to 2015. The results clearly indicate that LCCs are increasing their operations from major airports, while generally continuing their growth and expansion strategy. The main implication of which is the increase in direct competition between LCCs and traditional airlines while the impacts of this change on the smaller airports are not clear yet and need to be investigated further.     

Ready for digital transformation? The effect of organisational readiness,innovation, airport size and ownership on digital change at airports

This study investigates the effect of organisational readiness, innovation and airport size and ownership on digital change at airports. Data is collected from a survey of managers at 94 airports worldwide and analysed using partial least squares structural equation modelling. Organisational readiness is found to have a direct effect on digital change. Organisational readiness also has a direct effect on innovation, which subsequently affects digital change. Airport size has a direct effect on digital change while the effect of ownership is not significant. The findings show that successful development of organisational readiness can be used to speed up the rate of innovation needed for digital change at airports.     

Cost-benefit analysis of airport security: Are airports too safe?

This paper assesses the risks and cost-effectiveness of measures designed to further protect airport terminals and associated facilities such as car parks from terrorist attack in the U.S., Europe, and the Asia-Pacific area. The analysis considers threat likelihood, the cost of security measures, hazard likelihood, risk reduction and expected losses to compare the costs and benefits of security measures to decide the optimal security measures to airports. Monte-Carlo simulation methods were used to propagate hazard likelihood, risk reduction and loss uncertainties in the calculation of net benefits that also allows probability of cost-effectiveness to be calculated. It is found that attack probabilities had to be much higher than currently observed to justify additional protective measures. Overall, then, it is questionable whether special efforts to further protect airports are sensible expenditures. Indeed, some relaxation of the measures already in place may well be justified.     

Hot or not? The role of cycling in ASEAN megacities: Case studies of Bangkok and Manila

The Association of the Southeast Asian Nations (ASEAN) recognizes the role of nonmotorized transport for sustainable urban development in its policy framework. National and local policymakers in Thailand and The Philippines, two tropical countries without a tradition of urban cycling, are increasingly paying attention to cycling as well. This article aims to assess the current situation and progress in cycling, using Bangkok and Metropolitan Manila as case study cities, and to describe the necessary conditions for advancing the significance of cycling in tropical megacities. This is done by operationalizing the so-called Technological Innovation Systems (TIS) framework, which has been used in transition studies since 2008, however, never for cycling. As such this article also “tests” this framework for its application in sustainable transportation. The two case studies are characterized with regards to the current role of cycling in the mobility system, its infrastructure, governance system, and existing research on the potential and barriers. We find that TIS can readily be applied to our cases, with the analysis showing that elements such as knowledge development, actor networks, e-bike adoption, infrastructure, resource mobilization and legitimation are not well developed; on the other hand, flat terrain, attention for cycling for health and environment, heavy congestion, expansion of public transport, growing bike industry, active university communities, and the emergence of advocacy coalitions, could open up opportunities for increasing its modal share.     

Is increasing aircraft size common practice of airlines at congested airports?

If the overall demand for air transport grows, but additional airport capacity is not available at congested airports, we could assume that airlines will offer flights with more seats in order to cope with the demand. An analysis of frequency and average seat capacity developments at congested, and not yet congested airports, has shown that the hypothesis of bigger aircraft being used in congested situations is valid in most instances, although not at all airports. The objective of this paper is to report on an analysis of the development of average seat capacity at congested airports, in contrast to the situation at not yet congested airports, and to find out the reasons for airlines increasing the number of seats at congested airports, by means of a statistical model using variables including the degree of airport congestion and average flight distance.     

Do the regional growth effects of air transport differ among airports?

This paper empirically studies the contribution of air transport to regional economic development in Germany. We find that the scale and direction of output effects of air services and airport infrastructure differ among airports. These differences are driven by ‘opportunity costs’ of airport capital and by positive output effects from air transport connectivity. We argue that the latter impacts potentially depend on traffic characteristics.     

The impact of urban features in cycling potential – A tale of Portuguese cities

While the bicycle is commonly understood as a suitable alternative to fulfil most of urban mobility needs, adoption rates of this transport mode vary considerably among urban areas. Those at early stages of adoption, identified as starter cycling cities, face numerous challenges, reducing the effectiveness of policies and strategies. Much research has been dedicated at identifying social and physical environment conditions favouring the use of the bicycle. Assuming cycling potential results of a good combination of physical and socio-demographic factors, we set out to identify dominant contexts generating high levels of cycling potential. The previously developed Gross Potential for Cycling is applied to 21 Portuguese municipalities of different spatial contexts. By looking at the particularities of different typologies of urban territories, a set of k-means clustering analyses investigates which combination of factors contribute to the establishment of a high cycling potential.The results indicate that, in the set of case studies, high accessibility to schools and urban centralities are common in high cycling potential areas, regardless of spatial context. Three clusters were identified from the combination of the age profile of residents and the connectivity features of the territory, defining the main typologies of high cycling potential areas. As different urban typologies pose distinct configurations on the performance of the different evaluated indicators, these outcomes are crucial to inform policy makers on where to prioritize investment for the establishment of a new cycling culture.     

The air transport market in Central and Eastern Europe after a decade of liberalisation – Different paths of growth

This paper describes the changes which are taking place in air transport for the Czech Republic, Estonia, Latvia, Lithuania, Hungary, Poland, Slovenia and Slovakia in the context of liberalisation. It also attempts to identify the common and specific factors that influence these processes in different markets of the region. The indicators for the development of the aviation market were designed using, among other things, statistics describing the infrastructure facilities and the level of activity in the market. Composite indicators and the weights for their individual components were constructed using a Multidimensional Comparative Analysis. The conditions under which changes were taking place in Central and Eastern European Countries were described with the help of selected socio-economic panel data. Finally, One-Way Fixed Effects and Seemingly Unrelated Regressions (SUR) models describing the development of the aviation markets were estimated. The adopted procedure made it possible to identify the most important common and specific factors that exerted the greatest influence on the situation of air transport in CEE Countries. The very initiation of the liberalisation process undoubtedly had a significantly beneficial effect on the development of route networks and aviation activities as broadly understood. However, the pace of change depended not only on the progress of liberalisation itself, but also on the diverse socio-economic conditions in the individual countries. As a result of the analysis, the markets were divided into two separate groups, which in many respects are distinctly different from each other. The results of the estimation models also showed that there are strong unobservable determinants of development which are specific to individual countries.     

The end of growth in residential tourism destinations: steady state or sustainable development? The case of Calpe

This article discusses how the slowdown in the real estate market during the most recent economic and financial crisis has affected residential tourism destinations on the Spanish coast. The afore-mentioned crisis, which gave rise to a standstill in residential activity, coincided with the turbulences experienced in the competing destinations of Northern Africa, which brought about a record number of international tourist arrivals to Spain. The resulting situation enables us to explore the future scenario of all the Spanish destinations that, due to the depletion of available land, are reaching their maximum levels of urban growth. Examining the case of Calpe, a destination which is representative of the Spanish Mediterranean, the study analyses whether the foreseeable dynamics for the future are conceptualized in the favourable terms that characterize “sustainable development” or, on the contrary, exhibit negative implications which the classic economists refer to as the “steady state”.     

Evaluating transport user benefits and social surplus in a transport market—The case of the Norwegian ferries

The article first infers how consumer surplus in a market is linked to revenue under different assumptions about fare elasticity and when using different types of demand functions. This information is added to producer surplus in order to derive social surplus. The method, thus, produces a simple approach for authorities to assess social surplus in a market and its benefits to the users. A modified exponential demand function is applied to calculate consumer surplus and social surplus for 97 ferry services in Norway regulated by the state. The calculations are based on empirical data concerning ferry fare, revenue data at service level and reasonable assumptions about fare point elasticity for services covering different distances.In 2007, these services generated welfare for the users (consumer surplus) and the society (social surplus) amounting to about 5.8 billion NOK and 4.3 billion NOK, respectively. Consumer surplus and social surplus varied considerably amongst the services. Only 3 of the 97 services operate with positive profits and, hence, without subsidies. About 21 of the services contribute negatively to social surplus. Many of these unprofitable services are the only transport alternatives in rural areas and could be argued to continue operation according to politically decided regional measures. Implicitly, maintaining all these 21 services means that the welfare for the people in these areas is valued as up to four times greater than the welfare of the people in the rest of society.     

The role of schedule delays on passengers’ choice of access modes: A case study of Japan’s international hub airports

We empirically study passenger modal-choice behavior to access an international hub airport, by using stated preference (SP) data and by constructing a binomial logit model. We found that passenger modal choice is affected by the service level of the access modes: travel time, travel cost, waiting time, and delay cost. The results also indicate that if passengers choose access mode in advance they consider service frequency: departure timing from home, and the arrival timing at the airport. Moreover, our results indicate that travelers’ willingness to pay for saving time differs by time of a day. They are apt to pay more in the morning than in the afternoon. These outcomes must contribute to improve the access flight service from local to hub airports to handle the needs of passengers.