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Airlines investing in airports. A rare breed

The interest being shown by Kenya Airways in Nairobi’s Jomo Kenyatta Airport – and the manner in which it is being resisted – has focused attention on the desire some airlines have to integrate themselves horizontally with their service outlets.

Kenya Airways is one of several quite large airlines that are either engaged in this practice or are on the verge of doing so, with many other smaller examples dotted around the globe. They do it for a variety of reasons, but a lack of confidence in the government and airport operators figure highly. In many cases, there is little in the way of local regulation to stop them.

There is no single region of the world where such practices are more popular than others, but it does seem to have caught on in Southeast Asia, where  airlines have at one time or another applied for the rights to operate one or more airports. In their own country or abroad, and either alone or in consortium with airport operators and investors.

Different jurisdictions take varying positions in airline ownership in their airports. Regulatory authorities are generally wary of airlines taking too large a share, for fear of their distorting competitiveness in airport access, for example limiting the amount of any investment to around 5%.

But there is no hard and fast rule and different markets may have very different priorities.

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