Airports demonstrating leadership in reviving the sector – notes from Pillars of Aviation 2010

Airports demonstrating leadership

For starters, no speakers backed out, and the conference hall was full. This may not sound significant, but it’s one of the early indicators of things getting back to normal. Among all the speeches, I was impressed by the efforts airports like Melbourne and GoldCoast are making to work in-tandem with airlines to ensure a healthy, business-driving relationship.

In fact, Malaysia Airports is doing a tremendous job creating the hub of the future, with an LCC terminal interconnected with the existing Kuala Lumpur International Airport. That means when the new LCC Terminal is ready in 2011, passengers would be able to seamlessly connect from a Cebu Pacific flight from Manila, to an AirAsia X flight to Delhi, or a Malaysia Airlines flight to London. And at a combined capacity of 53 million per year, it would be the largest airport-hub in the region.

Now you see why I’m excited about the future?

Below, I have highlighted key points from a number of airport speaker’s presentations, to give you a sneak peek into what was discussed at the conference. For excerpts of presentations from airlines,head over to SimpliFlying.com

Airlines vs Airports debate

• Convergence of LCCs and legacies causes a problem for airports
• Airports have been built with the network carrier in mind
• The sudden explosive growth from LCCs result in airports trying to morph. By then LCCs change again – that’s the dilemma

Question by Damien of Melbourne Airport to airline CEOs: Airports have started to look the same. All like shopping malls. What would the next generation of airports look like?

• Turkish Airlines’ Temel Kotil: It’s ok if they charge, But services should be top class, even for transit passengers
• Peter Hill (Oman Air)
  • Muscat: Small/Compact. +ve: Get out in 5 mins. -ve: difficult to transit. Hence, airports should closely consult with airlines while increasing the size and scope of the airport – airlines are their customers
  • The airport hassle and experience is the single biggest negative impact on air travel, especially short haul, and when alternates are available
• Malaysia Airlines’ Tengku Azmil
  • Airport of the future should have a seamless experience
    • Fingerprint eGates
    • Download movies/iPads etc

Rimzie Ismail – Dubai Airports

• Airport Marketing – you’re only marketing the destination. The airport is a gateway, not a utility
• Service delivery at an airport
  • Customers are 3rd party stakeholders who interact with the pax, like shops, security staff
  • Passengers themselves are secondary customers – info desks, airport facilities
  • Services provided directly to airlines > Traffic rights, slots, ATC services
  • Service Champions – leading the brand delivery. Key ambassadors of the airport causing ripple efforts. 1.5mths salary as bonus + lunch with Sheikh Ahmad!
• Non-Aeronautical Revenue
  • Dubai duty free sales risen 20% last year!: Between 1995 to 2009, Dubai Airports traffic rose from 7.5Mn to 40Mn
  • Pax service charges
  • Rental
  • Ads
  • Hotel
  • Al Majlis – the lounge – VIP service where people can buy in: end to end VIP service. dedicated escort, private limo to the aircraft > $500 for up to 10 people. Top spenders are Saudi, Russian and Omani!
  • Executive flight services
  • Marhaba service – only escort service. $30 per psx
  • Dubai International hotel – 135% occupancy, because can be multiple times a day. Gym is also rentable per us $10
  • First Class lounge for rent – $25/hr! For economy pax, who want to experience First Class
  • Food – from 5 star dining (the only one in the world) to Irish Village – ethic food/beer
  • Non Aeronautical revenue growth is 5X of aeronautical revenue!