Network development of low-cost carriers in China's domestic market

This paper examines China's LCC market and assesses the network development patterns from a geographical perspective. Overall, a nationwide LCC network has been formed with each individual LCC focusing on their own markets with limited overlap to avoid cut-throat competition. Spring Airlines has developed an advanced network supported by its core bases including Shanghai in East China, Shijiazhuang in North China, Shenyang in Northeast China and Shenzhen in South China. China United has developed a network radiating from Beijing. West Air and Lucky Air seem to be developing a hub-and-spoke network that contributes to the tourism industry in West China. The LCC network is affected by seasonal variations, especially for the routes to tourism destinations such as Haikou, Sanya and Xiamen. Hub cities, however, experience less seasonal impact. This research also finds that routes between 600 and 1800 km account for a large proportion of the LCC markets. Aviation policy, local government's subsidization and the expansion of the high-speed rail network have helped shape the landscape of China's LCC sector.     

Economic influences on air transport in Vietnam 2006–2019

Vietnam has emerged from a long and complex post-colonial experience as a fast-growing economy now embedded in the complex network of economic linkages in the Asia-Pacific region. Those linkages involve trade, foreign direct investment, and tourism. Their underlying geography is reflected in the geography of Vietnam's air transport linkages. An early set of air connections with ASEAN neighbours, especially Singapore and Malaysia, are still significant, though routes to South Korea and China are now more important. Within the country, the colonial structure of Hanoi as a political capital, and Saigon (now Ho Chi Minh City) as a trading city, provided the framework for domestic air transport linkages. Here too the geography has shifted to include a set of smaller cities, especially those with tourism activities. The Hanoi-Ho Chi Minh City corridor is still dominant, and now ranks as one of the busiest domestic routes within the Asia-Pacific. These outcomes confirm the effect of economic development on air transport in Vietnam.     

Characterisation of airline networks: A North American and European comparison

This paper contrasts the North American and European air transport markets using the extensive Official Airline Guide Databases. The pattern of network development in the two continental regions is examined using data for 1996–2008. The top ten carriers in both regions are analysed closely in terms of network structures and the basic geographical characteristics of these networks are highlighted. In addition, different measures of air transport activity such as seating capacity, and number of movements and of routes are compared. Visualisations of carrier networks are used to highlight the different network strategies operated by low cost and full service carriers. European carrier networks display many significant differences to North American carrier networks. European carriers generally organise their networks around one or two key nodes within the member state in which they are registered and generally do not operate interactive, continental-wide, multiple hub-and-spoke networks as do North American carriers. European and North American low-cost carriers operate much more interconnected networks than full services carriers. Southwest Airlines stands out as operating a particularly highly interconnected network.     

Performance evaluation of China's air routes based on network data envelopment analysis approach

Air routes are among the most important elements of civil aviation transport. Airlines' operations are mainly dependent on the structure and layout of air routes. This paper first divides the production process of air routes into two stages, allocation and transport, based on air route operational characteristics. Then, two network data envelopment analysis (DEA) models are proposed to analyze the efficiency of the system, allocation, passenger transport, and freight transport of 477 air routes. The research result demonstrates that the different constraints on intermediate measure in the network DEA models do affect the air routes’ efficiency significantly; Most air routes have high allocation efficiency and passenger transport efficiency, while they have low freight transport efficiency. Furthermore, the efficiencies of 82 airports are also analyzed after aggregating the efficiencies of the air routes.     

The networkability of cities in the international air passenger flows 1992–2004

A modified social network analysis model was designed in this study for use in the examination of the international air network. By using this model in analyzing the networkability of cities, the connectivity of the air routes was estimated, using the air traffic and the number of air routes. Networkability is the quantitative measurement of the spatial interaction relationships in the international air network. Through this process, this study aims to analyze the structural changes of the global network in 1992 and 2004. As a result, it was observed that London, Paris, Frankfurt, Amsterdam, and New York were class 1 cities that were at the top in both years. Tokyo was included in class 1 in 1992, but not in 2004. Rome, Zurich, Singapore, Los Angeles, and other cities were identified as the class 2 cities in 1992, while Singapore, Tokyo, Madrid, Hong Kong, Bangkok, etc. were identified as the class 2 cities in 2004. These cities occupy the center of the global network, and the class 1 cities are connected to the class 2 cities, which perform the function of hubs in each continent, thus uniting the whole world as one network.     

Mapping causalities of airline dynamics in long-haul air transport markets

The introduction of low-cost air transport services to short-haul routes has significantly shaped the structure of this market segment. Recent research investigates and discusses the transferability of the low-cost carrier business model to long-haul routes and identifies respective challenges such as lower cost advantages over the competing full-service network business model. Our paper complements the existing research with a review of airline dynamics in long-haul air transport markets and the subsequent development of a causal loop diagram of the transatlantic air transport market using systems thinking. The objective of this paper is to provide an overview of specific characteristics regarding airline operations in the transatlantic air transport market to investigate the market potential of long-haul low-cost carriers competing with full-service network carriers in this market. We implement these characteristics in a causal loop diagram which comprises the most important elements of and causalities within the long-haul air transport market that affect the development of these elements. These include the generation of transatlantic air transport demand, passenger choice, and airline ticket price and fleet development. The causal loop diagram serves as a framework for qualitative investigation of the market potential of long-haul low-cost services. The paper proves systems thinking to be a feasible approach to map causalities based on knowledge from scientific literature.     

Liberalization and changing spatial configurations in Nigeria’s domestic air transport network

In realization of the increasingly important role played by air transport, the Nigerian government followed the global trend of deregulation in reforming its domestic airline industry in 1985. Some of the effects of deregulation have been consistent with observed trends in other countries but others have been quite different. The abandonment of less profitable routes in the short term as well as the unfolding core-periphery structures following the emergence and dominance of certain core control centers replicates what obtained in the United States. However, evidence from literature suggesting that liberalization in practice has often resulted in the rising concentration of connectivity in a limited number of nodes and links rather than in its dispersal over the network at large does not hold yet in Nigeria’s domestic air network. This paper shows that the shifting balance between concentration and dispersal in Nigeria’s domestic network is generally skewed towards dispersal. Passenger traffic is more dispersed among nodes as gleaned from diminishing standard deviation values with increasing number of nodes. Generally speaking, overall connectivity also tends towards more evenness in the network since deregulation.     

The transformation of a legacy carrier – A case study of Turkish Airlines

This study examines the metronomic rise of Turkish Airlines into a global carrier in the period following domestic deregulation and part privatisation. Using a comparative assessment of the carrier's network and its competitive strategies during the 2003–2013/2014 period it was found that Turkish Airlines now benefits from considerable network, cost, service and brand advantages over competing European and to a lesser extent Middle-Eastern airlines. Its network operation based in Istanbul Ataturk airport enjoys strong geographic and demographic advantages, which enables it to optimise the use of its large and young short-haul fleet between a significant number of domestic and international points. This study has important implications for partially or fully state owned legacy carriers as to how to gain competitive advantages in an increasingly open and liberal airline industry.     

Dynamic effect of inter-firm rivalry on airfares: Case of Japan's full-service and new air carriers

This paper analyzes the dynamic changes in carriers' airfares and outputs and computes the change in the consumers' surplus year by year after new Japanese carriers entered thriving routes and started to compete with Japanese full-service airlines. Using unbalanced panel data from 222 routes and carrier specific sample observations, it finds that new carriers discounted airfares significantly as soon as they entered new markets, but two early carriers, Skymark Airlines and AIRDO, which had entered with very low airfares, raised their prices year by year. On the other hand, both All Nippon Airways and Japan Airlines responded to the new entrants and lowered their airfares to a much lesser extent than the new entrants did, and their airfare levels remained almost unchanged for at least four years after the first entry. The consumers' surplus increased significantly in the first year of each new entry but gradually decreased as the new entrants raised their airfares.     

Shaping urban transport policies in China: Will copying foreign policies work?

After decades of rapid economic growth, Chinese cities now face serious urban transport challenges, such as congestion, air pollution, energy shortage, and global climate change. Efficient and equitable urban transport policies are essential to China’s sustainable development, in which urbanization plays a critical role. Can Chinese cities solve these challenges by copying or modeling the policies of other nations? This paper argues that understanding the unique contexts of Chinese cities is necessary for predicting whether policies implemented elsewhere will perform well in China. The study explores four examples of hotly contested urban transport policies. The previous experience of each policy is compared with its likely efficiency and distributional consequences in China. Specific attention is paid to how the policy context – the spatial and institutional characteristics of the Chinese cities – can affect the adoption of foreign urban transport policies in China. Suggestions regarding the four policies are proposed to policy makers, followed by conclusions and discussions.     

Transport corridors and regional balance in China: the case of coal trade and logistics

Coal plays a vital role in the socio-economic development of China. Yet, the spatial mismatch between production centers (inland Northwest) and consumption centers (coastal region) within China fostered the emergence of dedicated coal transport corridors with limited alternatives. Serious problems of energy shortage and power rationing have already affected southeastern China. At the same time, enormous interregional coal transfers face a lack of transport capacity along the transport system. Based on first-hand statistics, a disaggregated analysis of coal distribution patterns since the late 1970s provides novel evidences about the local effects of macroscopic trends, such as the shift from dominant exports to dominant imports in terms of changing traffic concentration levels and distribution patterns among routes and ports. The spatial evolution of coal distribution is also discussed in terms of related industry linkages and local influences, coal trade policies and market pricing, port system evolution, and transport network planning. The paper also discusses possible improvements of the current situation through enhancing multimodal transport based on a review of current policies.     

Airline and railway integration

Most of the transport literature only looks at mode alternatives in competition with each other, rather than exploring the potential for cooperation. This paper examines this possibility by making the case for aircraft and high speed train (HST) substitution under conditions of intermodal integration. In the model suggested, airlines use railway services as additional spokes in their network of services from a hub airport to complement and substitute for existing aircraft services. Airlines benefit from the slots that are freed and they can support mode substitution. Society gains from the social and economic benefits of better integrated transport services at a lower environmental cost. This paper examines this model of integration at Heathrow airport against the background of UK air transport policy and assesses the benefits and limitations of it. The conclusion reached is that some railway infrastructure should also be seen as part of the air transport infrastructure.     

Reform and opening up: Way to the sustainable and harmonious development of air transport in China

The global air transport has been undergoing wings of change in the past 30 years as a result of deregulation and liberalisation. During this period, the air transport in China has also been undergoing significant transformation and rapid growth following the reform and opening up policy of China since 1978, the same year when the USA enacted the Airline Deregulation Act. Although China has become the world's second largest air transport system since 2006, few studies have analyzed the growth pattern and policy evolution of this important market. This paper critically reviews the development of the air transport policy of China and examines the challenges in the 21st Century. Such an investigation leads to the following conclusions: (A) the reform of China's civil aviation has been based on the national policy in socialist market economy as well as the liberalisation of air transport; (B) the substantial growth in the last three decades has been driven by economic growth as well as the transformation of China's transport industry. (C) In order to sustain the rapid and continuous development in civil aviation, China should continue to implement scientific management and development, deepen the reform and opening up and continue liberalisation.     

The growth of Arabian airlines from a German perspective – A study of the impacts of new air services to Asia

Airlines from Bahrain, Kuwait, Qatar, the United Arab Emirates and Oman have gained significant market shares in international air transport. Traditionally travellers have chosen hubs like Amsterdam, Frankfurt, London or Paris as transfer points for trips to Asia. With the inauguration of non-stop services to places like Abu Dhabi, Doha or Dubai, new choices for air travellers have emerged. We analyse data derived from German air transport statistics on the effects of passenger flows between the airports of Düsseldorf and Hamburg to Asian destinations. They suggest that services introduced by Emirates stimulated passenger demand for Asian destinations, while incumbent hubs do not lose transfer passengers. Regarding travel times and connection quality of routings between secondary airports in Germany and Asian destinations, comparing routings of Emirates Airlines and Lufthansa suggests that due to geographic and scheduling constraints, services via Arabia do not constitute a perfect substitute for time-sensitive passengers.     

Growing bus patronage and addressing transport disadvantage—The Melbourne experience

Melbourne's bus network serves two-thirds of the city's population but, until recently, has generally had very poor service levels. The Victorian government has recently embarked on programs to (1) extend a network of premium trunk routes to address a ‘mass transit’ agenda and (2) upgrade local routes to ‘safety net’ minimum service levels, to address a ‘social transit’ agenda (reducing transport disadvantage and social exclusion). The paper reviews recent experience from the service upgrades to assess how effective they have been in terms of these agendas. Analysis of patronage growth trends and the impacts of these upgrade programs suggest reasonable minimum service levels are required to attract new riders in times of modal shift, and are effective at building social capital.     

Economies of traffic density and scale in the integrated air cargo industry: The cost structures of FedEx Express and UPS Airlines

This paper examines the cost structures of the leading integrated air cargo carriers, FedEx Express and UPS Airlines. A total cost model is estimated for the two carriers using quarterly data on domestic operations and costs over a nine-year period (2003–2011). The estimated model indicates that the integrated industry exhibits increasing returns to traffic density and constant returns to scale. Accounting for carrier-specific differences in cost structure and network size, FedEx Express is found to be more cost-efficient than UPS Airlines. Looking at the carriers individually, UPS Airlines exhibits substantial economies of traffic density and constant returns to scale while FedEx Express' cost structure is characterized by weak economies of density and constant returns to scale. The combined effect of returns to density and returns to scale on the cost structures of integrated carriers is captured by economies of size. Both FedEx Express and UPS Airlines exhibit economies of size, indicating that carriers in the integrated industry can be more cost efficient by making appropriate adjustments to their network size as their output grows. Moreover, the relative cost-efficiencies of the carriers are reversed when their network-size differences are not controlled.     

The carbon emissions of selected airlines and aircraft types in three geographic markets

Various carbon calculators developed by airlines and carbon offset companies have become available since the environmental impact of the air transport industry started to receive strong attention. This paper details a prototype methodology for carbon calculation emission levels in the three air transport markets; the UK domestic routes, the intra-EU routes serving UK and the North Atlantic routes that enables the assessment of key environmental performance differences between air carriers whereas they would be measured as identical using the often used DEFRA-type measurement approach. The results show differences in airlines' strategies such as aircraft type used, load factors and seat configurations.     

Exploring the network structure and nodal centrality of China’s air transport network: A complex network approach

This paper uses a complex network approach to examine the network structure and nodal centrality of individual cities in the air transport network of China (ATNC). Measures for overall network structure include degree distribution, average path length and clustering coefficient. Centrality metrics for individual cities are degree, closeness and betweenness, representing a node’s location advantage as being directly connected to others, being accessible to others, and being the intermediary between others, respectively. Results indicate that the ATNC has a cumulative degree distribution captured by an exponential function, and displays some small-world (SW) network properties with an average path length of 2.23 and a clustering coefficient of 0.69. All three centrality indices are highly correlated with socio-economic indicators of cities such as air passenger volume, population, and gross regional domestic product (GRDP). This confirms that centrality captures a crucial aspect of location advantage in the ATNC and has important implications in shaping the spatial pattern of economic activities. Most small and low-degree airports are directly connected to the largest cities with the best centrality and bypass their regional centers, and therefore sub-networks in the ATNC are less developed except for Kunming in the southwest and Urumchi in the northwest because of their strategic locations for geographic and political reasons. The ANTC is relatively young, and not as efficient and well-developed as that of the US.     

Urban transport crisis in India

Indian cities face a transport crisis characterized by levels of congestion, noise, pollution, traffic fatalities and injuries, and inequity far exceeding those in most European and North American cities. India's transport crisis has been exacerbated by the extremely rapid growth of India's largest cities in a context of low incomes, limited and outdated transport infrastructure, rampant suburban sprawl, sharply rising motor vehicle ownership and use, deteriorating bus services, a wide range of motorized and non-motorized transport modes sharing roadways, and inadequate as well as uncoordinated land use and transport planning. This article summarizes key trends in India's transport system and travel behavior, analyzes the extent and causes of the most severe problems, and recommends nine policy improvements that would help mitigate India's urban transport crisis.     

The development of the Gulf region’s air transport networks – The first century

This paper employs the concepts of centrality, intermediacy and proximity to explain the evolution of air transport networks in Asia and applies them to the region surrounding the Arabian Gulf. In doing so the paper provides a structured, historical account of the development of air transport in a region that occupied a central place for important trade routes for thousands of years. The paper argues that there has been a “principal axis shift” so that the role of the region is no longer defined as an intermediate section of the east-west routes. Indeed, the region has come to re-occupy a central place in trade and travel flows serving a fundamentally changed global aviation network building upon the economic and social development within the region.