From Global Airlines: Competition in a Transnational Industry, Third Edition

5.5 Effects on airports

Airport economics

Hubbing is not entirely without its diseconomies, although these are largely external to the airline. In generating large volumes of transfer passengers, and requiring them to be handled swiftly, the hub airline contributes adversely to the peak-load capacity problem at the airport, not only on the runways but on the aprons and in the terminals as well. Its demand for facilities at the hub, such as baggage transfer equipment, can be very peaked indeed. Flight complexing leads to some severe peaking in arrivals and departures and this is necessary to ensure a large number of usable connections. But at the same time it can reduce efficiency in the utilization of airport facilities which might only be maximized when demand is spread evenly across the operating day. In this regard there can be a conflict between the interests of hub airlines and profit-motivated airport authorities. In many ways the economics of transfer traffic are not so attractive to airport operators as those of origin-destination traffic. In some cases fierce competition for footloose transfer traffic, traffic that can choose between a number of different hubs, has induced some airports like Amsterdam, Dublin and airports in Spain and Italy to waive their passenger charges for connecting traffic. Income from aeronautical activities is often not so great as the revenue airports earn from their non-aeronautical commercial activities. But here too connecting traffic may often not be all that remunerative to the airport on a per-passenger basis.

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Real Estate Sales, Leasing, and Rental Services involves the sales or rental of space to perform a business activity. Commercial, industrial and office space typically falls under these transactions. Sales involves transfer of title/ownership of the build
Waterway Barriers and Booms
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Topics of Interest

5.6 Effects on passengers The success of a hub and spokes system depends crucially on the airline's ability to control its traffic flows (and revenue yields) via the connecting bank of flights at the...

5.6 Effects on Airports Airport Economics Hubbing is not entirely without its diseconomies, although these are largely external to the airline. In generating large volumes of transfer passengers,...

5.5 Effects on Airline Operating Costs To begin with, what effect does hubbing have on airline operating costs? Compared with direct flights, hubbing involves additional passenger handling, places...

5.4 Costs and Benefits of Hubs Is airline hubbing a good thing? There is little doubt that it is good for the competitive position of the individual airline. But is it good overall? Does it produce...

5.1 Co-Ordination of Flight Activity Traditionally airline schedules were designed, either for the convenience of local point-to-point passengers, or to meet operational objectives such as maximizing...