Harbison opens Low-Cost Conference in Mumbai, calls on governments to liberate low cost airline grow
Speaking at the conference in Mumbai, Mr Harbison stated that the role of government permeates everything that happens in the industry, all too often to negative effect.
Mr Harbison cited the case of the exponentially growing Indian low cost sector as an example of the type of progress possible when government excuses itself from overbearing participation in the industry. After years of protecting the domestic carriers with market-stifling results, the government reversed course.
“To its credit, the Indian Government recognized that protectionism has become ineffective in a globalised market and that the national economy needed more domestic air service which the established airlines couldn't fill. Accordingly, it allowed new entry and route access on an unprecedented scale”, he said.
The result, he explained, has been a huge boom in air service and traffic levels throughout the world's second most populous country, benefiting consumers and carriers alike.
“Unfortunately, government remains an active player in the air transport sector throughout Asia. To ensure that the situation of India – which for years featured unparalleled potential for growth that wasn't allowed to materialise – isn't repeated throughout the region, we call on all players in the aviation sector – airports, tourism authorities and governments themselves – to do their part to help catalyse greater liberalisation”, said Mr Harbison.
As part of his "Wake-up call" manifesto for growth, Mr Harbison urged airports to use their resources, including such international organisations as Airports Council International (ACI), to notify their governments that they want additional services, and also to register their interest with the low cost airlines, who have shown themselves willing to serve unconventional destinations.
He also exhorted tourism organisations throughout the region to combine their efforts with counterpart groups in other cities and countries (eg, PATA) to lobby their governments to enact the liberalisation that will bring them greater numbers of visitors.
Mr Harbison lastly called on governments themselves to remove restrictions on international route access to regional gateways, which have significant prospects for growth and regional development without threatening the health of the flag carriers. He also asked the states of the region to permit foreign investment in national airlines – up to 49% – in order to stimulate new market opportunities.
Finally, he said that governments should accelerate the privatisation of their airlines and airports.
The benefits in following such a course are evident to any who have watched the development of the low cost sector throughout the region. Addressing the possibility that this revolution might be ultimately reversed, Mr Harbison closed his presentation by stating: "The egg has been scrambled – there is no turning back."