Airports’ perspectives on the growth of low-cost airlines and the remodeling of the airport–airline relationship

By Graham Francis, I. Humphreys, Stephen Ison. 2004

171 citations recorded by the source corpus.

Abstract This paper explores the way in which airports have responded to the apparent opportunities afforded them by the growth of low-cost airlines. The adoption of a so-called low-cost model by airlines has made many airports fundamentally reconsider who their customers are. The low-cost model impels airlines to negotiate contracts which significantly reduce aeronautical charges by the airport, consequently seeking to make up this short fall by commercial revenues from the increased passenger numbers. This is not however without consequences for the airports, their passengers and the relationship between the airport and its existing airline operators. The recent growth of low-cost airlines has naturally attracted the attention of airport managers as a source of volume to alleviate commercial pressures; however, due to low-cost airlines’ unwillingness to pay high airport fees there is the difficulty of translating any increased volume of passengers into increased revenue. This paper reviews the behaviour of a number of different airports in Europe and identifies important issues for airport management to consider when negotiating with low-cost airlines.

Subfields: Economics and Econometrics, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/0b595f11ab887b50e55bf8a27121100889c745dd

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Citations in the corpus

Online purchasing tickets for low cost carriers: An application of the unified theory of acceptance and use of technology (UTAUT) model (2014, background): “…of LCCs on tourism (Aguiló et al., 2007; Rey, Myro, & Galera, 2011), and on examining the impacts of LCCs on airports, including the relationship between LCCs and airport operators, and the corresponding competitive airport strategies that have been developed (Francis et al., 2004; Graham, 2013).”
The transferability of the low-cost model to long-haul airline operations. (2007, background): “within Europe ( Francis et al, 2004 ) is less effective in the long-haul markets.”
REVENUE SHARING WITH MULTIPLE AIRLINES AND AIRPORTS (2010, background): “Furthermore, commercial operations tend to be more profitable than aeronautical operations (e.g., Jones et al., 1993; Starkie, 2001; Francis et al., 2004), owing partly to prevailing regulations and charging mechanisms (e.g., Starkie, 2001).”