In Berlin, an impressive line-up of industry speakers and researchers from all continents gathered to discuss practical strategies to support the industry to the benefit of aviation users. A theme of many presentations was inter-dependence in the value chain: manufacturers, lessors, airports, air carriers, ATC providers and others. It was suggested that improved cooperation could increase overall returns, which are low and sometimes negative in parts of the chain.
Speakers proposed ways to reduce airport-airline irritants, for instance, by sharing non-aeronautical revenues, by avoiding counter-cyclical pricing and possibly by airports’ phasing-in capital investment. Presenters considered that code-sharing and formal alliances between airlines could reduce airline costs by streamlining networks.
Whether airports still need price regulation was ardently debated, given different views on the market power of airports and the effectiveness of regulation. Equally keenly discussed were ways to plan and manage aviation investment, given the capacity shortfalls in some jurisdictions but the record of expensively mis-judged investments in several others.
In the closing discussion at the conference, an expert panel argued that aviation users suffer because of stalled liberalisation but that giving a new impetus to reform could stimulate employment and growth around the world.
Martin Kunz Memorial Lecture
This invited lecture was given by Jaap de Witt, Director of the Netherlands Institute for Transport Policy Analysis. Under the title of “What would you do with 130 Airbus A380 aircraft?” Professor de Witt addressed a topic that is controversial in some quarters: the implications for the developed world of the expansion of Middle-Eastern and developing-world airlines.
Professor de Witt’s conclusion was that there wasn’t evidence that new-entrant airlines were ‘dumping capacity’ or benefitting from state aid or other forms of an ‘unlevel’ playing field. Therefore this latest form of competition in the market for international air travel should be permitted by international policy makers.
European Aviation Economics and Management Prize
At the conference, Ashgate publishers presented prizes for the two best research papers given at the GARS Research Workshop earlier this year. These went to:
Hugo Silva, (Uni. Amsterdam) for his model of how airport charges should be set, taking account of airline competition for congested airport slots, and Boris Oestmann (UAS Bremen) for his paper developing a quantitative indicator of the effectiveness of anti-cartel policy in the air cargo industry.
Source: EAC/ AIRTRANSPORT NEWS
