Low-Cost Airports for Low-Cost Airlines


Geneva airport plans to charge budget airlines smaller fees than standard airlines.

Low-cost travellers would have taxes reduced to SFr14 ($11) while others would see the rate upped by SFr3 to at least SFr19.

The move is designed to cement Geneva�s position as a hub for budget airlines, which are continuing to capture a larger share of the market.

But this is NOT price discrimination; instead airport authorities justify it as cost allocation. The low-cost terminal will be inexpensively remodeled, and the savings will be passed onto the low-cost airlines.

Naturally, entrenched interests do not like this one bit:

Despite the claim, airlines such as Air France, KLM and Lufthansa have cried foul.

The three traditional carriers, which account for about 20 per cent of all passenger traffic at Geneva, said that the two-tier fee system grants low-cost carriers an unfair competitive edge.

�It�s very apparent that this is a solution designed to suit easyJet,� Werner Kellerhals of Lufthansa told the "Tribune de Gen�ve".

The "unfair competition" line will be a tough sell to anybody trained in standard price theory.

The airport jointly produces standard and budget airline flights; if its managers can demonstrate that budget airlines are cross-subsidizing larger airlines, I don't think there's an easy way to stop the airport from charging different prices.


How about charging small planes for the landing/takeoff slots they consume at major airports?

Let the winds blow and the best man win.
Free market.....

Currently researching LOW COST AIRPORTS and belatedly came across your website. Believe there is a strong case for moving towards semi / totally automated airports; the technology is available for most elements of processing, just requires some lateral thinking by decision makers and operators. Equates to movement from corner shops to supermarket trading! In case anyone queries my credentials, yes I've previously managed airports in the UK and advised on overseas locations. Would be pleased to receive comments / debate from other readers.


Semi or total automation is an intruiging but rather ill-defined proposition; still it's one I'd be interested in exploring further.

Which functions of airports are to be automated? Right now I have my doubts about the feasibility of automation outside of baggage systems.

Even supermarkets have only begun eliminating cashiers! The movement and stocking of goods is still labor intensive, and the use of RFID in tracking them is in its infancy.

However, I'm a newbie at this type of research, and before making silly analogies with no first-hand information, I'd like to know, bluntly, if there is a profit (or even a total cost savings) to be had in semi-automated airports. Perhaps the European market differs from the American one in the profitability, due to market structure, labor costs, or the scale of airports.

I have checked your credentials, and as an experienced pro, you must know much more about airports than I ever will.

I would be very interested in reading your Difficulties in the Era of Privatisation and Low Cost Airlines, especially since I'm not sure who -- the airlines, the government, travelers -- is supposed to be having the difficulties...

As an aside, my economics training really made me appreciate the sensibility of what you told the BBC, "We need to go to airlines and show them the attractions of using it, that the demand is here and that they can make some money by utilising it."

This is the type of talk that must make CEO's of low cost airlines vary happy.

Evening Kevin
Noticed your comments (from March) whilst browsing for Low Cost Airport material. Sorry haven't been in touch sooner. The automated airport work continues at a pace; now involving post-graduates in lateral thinking process for coursework on the same subject. Latest items which you might enjoy;
AUTOMATIC SECURITY SCREENING from SMART CARD-TYPE BIO DATA COLLECTION. Detailed information added to electronic cards such as credit cards which serves to buy a range of services and FAST TRACK PAX through terminals. Where information does not match system, human intervention is activated. Automated Check In already in place with CUSS kiosks and Baggage Handling trials using ROBOTS already under field trial. If you can have un-manned air vehicles, then why not automated airport processing? Next area automated aircraft tugs i.e. operated by remote control from an airside building. Would be pleased to continue dialogue on this whole topic; objective to provide low cost airports in line with expectation of low cost airline customers, namely - you, me and a growing part of the world's population. Regards. Graham Greaves

its amazing that there is a growing demand for no frill airports ...looks like it will be the next step to cheaper air transport.....
if there is additional information that anybody else has on no-frill airports..i would be happy if you could pass on some information


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This page contains a single entry by Kevin published on June 24, 2004 2:00 PM.

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