Airports worldwide adapting to the demands of the LCCs - new study released

The Centre has now published the second edition of this unique management report. The report notes it may be that the LCCs have all but exhausted viable routes to fly in some regions, but the enormous delivery schedule of new equipment from Seattle and Toulouse to the LCCs both now and during the next few years suggests that an ever more desperate search for new routes on which to fly these aircraft will continue and grow, creating a major opportunity for some airports.

Airports must understand LCCs

Airports must therefore continue to adapt to the demands of the LCCs, allowing for their increasing propensity to change shape.

The second edition of the Low Cost Airports and Terminals (LCAT) report notes, "apart from the well-documented cases of hybrid airlines that attempt to satisfy all passenger types, we are seeing a clear shift towards the business traveller in some LCCs - including GDS participation, business lounges and fast-track check-in and security clearance, while others experiment with shared website booking facilities, and codesharing between themselves, long haul LCCs and even legacy airlines. We have not seen many major mergers or takeovers in this segment in recent years, but that is not to say they will not occur".

The long haul LCC experiment having previously failed, AirAsia X looks as if it will succeed, and has already established new operating patterns, such as 30% of its passengers transferring to other, short haul LCCs at London's Stansted Airport.

"This introduces a new conundrum for airports - how to cater for the long haul/short haul low cost non-interline transfer", states the LCAT report.

No longer is the interface between legacy airline and LCC regarded as 'contamination.' It is clear that the two must co-exist and the low cost terminal epitomised for example by early versions at Singapore and Kuala Lumpur (March 2006) may already be out of date. Indeed, the decision by Malaysia Airports to make the new low cost terminal at Kuala Lumpur part of a 'next generation hub' concept demonstrates the contemporary thinking. It will facilitate 'seamless interchange' between all sorts of airlines - full service, low cost and regional.

Some airlines are not party to such agreements and will continue to hammer home their own message for as long as it takes. Ryanair for example remains fixated on cost and regularly takes the decision to quit operations completely at airports that will not comply with the charging structure it expects. But recently one British airport took a very public stance and refused outright to lower its charges, losing almost all Ryanair service as a result, but arguing that there were already too many unsustainable routes.

At the same time, another British airport is standing firm against the demands of easyJet to lower its charges. Could it be that the slimmed down, leaner airport sector is now in a position to drive its own bargains with the LCCs? And what implications would that have for the level of facilities it offers the airlines?

The release of the LCAT report comes ahead of The Centre's much-anticipated Global LCC Outlook report, due to be published shortly.

About Low Cost Airports and Terminals Report (2009 Update)

The LCAT report is the only comprehensive, management report published on low cost airports and terminals.

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• Learn from 25 airport case studies;
• Detailed examination of the development of low cost airports and terminals at Liverpool, Frankfurt (Hahn), Singapore and Kuala Lumpur;
• Prospects for their proliferation worldwide;
• The demands placed on airports by low cost carriers and how to cope with them;
• The prototype low cost airport;
• Market making - methods of improving non-aeronautical revenue streams;
• What chance low cost cargo terminals?;
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Table of Contents (October 2009 update edition)

1. The Low Cost Airline Phenomenon and its effects on Airports
   1. A brief history of the LCC
   2. Where is the LCC industry heading?
   3. Is the LCC honeymoon over?
   4. Pressures placed on airports
   5. How do airports position themselves in this environment?
2. The demands placed on airports by low cost carriers
   1. The emergence of the two-tier and low cost airport
   2. What do low cost airlines actually want from airports?
   3. Case studies
   4. How airports can take advantage of the environment created by the LCCs - market creation
3. Creating a thriving new airport: Two case studies from Europe
   1. Liverpool John Lennon Airport
   2. Positive parallels to be drawn
   3. Pitfalls facing other LCAT operators arising from these case studies
4. Low cost airports & terminals in Europe
   1. United Kingdom
   2. Switzerland
   3. France
   4. Belgium
   5. Hungary
   6. Germany
   7. Poland
   8. Italy
   9. Iceland
   10. Spain
   11. Denmark
   12. Finland
   13. Sweden
   14. Latvia
   15. Other LCCT Developments
5. Low cost airports & terminals in North America
   1. Introduction
   2. Pittsburgh Airport
   3. Chicago Midway Airport
   4. Baltimore-Washington International Airport
   5. New York J F Kennedy Airport
   6. Austin Bergstrom Airport, Texas
   7. Dallas Love Field
   8. Canada
6. Low cost airports & terminals in Asia Pacific
   1. Malaysia - Kuala Lumpur
   2. Singapore - Changi Airport
   3. Thailand
   4. Macau Airport
   5. Zhuhai Airport
   6. Diosdado Macapagal Airport (Clark), the Philippines
   7. Manila Ninoy Aquino International Airport
   8. Melbourne
   9. Newcastle Airport
   10. Gold Coast Airport, Coolangatta, Queensland
   11. Sydney Airport
7. Prospects for the spread of LCATs
   1. India & South Asia
   2. Indonesia
   3. New Zealand
   4. North Asia
   5. Africa
   6. Latin America
   7. Middle East/Gulf States
   8. Russia
8. Airlines, airports and communities: A European perspective
9. Low cost airports and non-aeronautical revenues
   1. Introduction
   2. The way forward
   3. Assessment of the key revenue streams
   4. The relationship with concessionaires
   5. The effects of the economic recession, 2008-09
10. Other issues affecting LCATs
    1. Opportunities for low cost cargo airports
    2. Economic impact and route development funding assistance to LCCs/LCAs
    3. Who are the passengers?
    4. Provision and use of lounges at LCAs
    5. Implications for ground handling companies
    6. Benchmarking and differentiating the costs and benefits of a separate low cost airlines terminal versus a mixed-use one
    7. The costs and benefits to an LCC
    8. What happens when FSCs and LCCs start to merge?
    9. Can rail seriously challenge LCCs/LCATs?
11. Appendix 1: Retail Concessions - Europe
12. Appendix 2: Retail concessions outside Europe
13. Appendix 3: Existing low cost airports (A) and terminals (T), examples
14. Appendix 4: Examples of projected low cost terminals and airports

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