Airport Business Models
BIMAL G R Marketing Manager Cochin International Airport limited
This paper deals with the most pertinent thought in the minds of aviation experts , world over – The Best Business model of airports. There exists various business models in the planning, construction and operation of an airport in the world. The study analyses the various business models and try to ascertain the importance of a business model over the others with example of a new generation airport which is immensely profitable to the stakeholders. The major differences of that airport over the other airports in the country in terms of model of construction. Funding,operation and revenue sharing is mentioned in detail. Airport ,as being fully privately owned enterprise is a very important problem . There were a lot of discussions , dedicated to this problem ,which tried to examine and study experience of world practice of privatizing and shareholding of airports as one of means to increase effectiveness of work in conditions of market relations . Some countries cannot make airports being fully privately owned enterprises because they don 't have legal securing in governmental property of usage airports . Absences of legalized documents which give right of management by governmental property don 't give opportunity to attract foreign investors , limit development of non-aviation activity , and create a lot of other problems . In these conditions coordination of efforts in the country , forming of legal regulations and regulation of activity of aircraft companies ,airports and other organizations of this field , directed at guaranteeing of safety flights and protection of customers ' interests is very important . A new business model of Airport , PPI – Public –Private Investor model ( Peoples Airport Model ) which has proven to be the most effective and profitable model of business in Cochin ( Kerala – India ) is subjected to detailed analysis in this paper. Aviation Industry and India The history of civil aviation in India began in December 1912. This was with the opening of the first domestic air route between Karachi and Delhi by the Indian state Air services in collaboration with the imperial Airways, UK. Three years later, the first Indian airline, Tata Sons Ltd., started a regular airmail service between Karachi and Madras .In early 1948, a joint sector company, Air India International Ltd., was established by the Government of India and Air India (earlier Tata Airline) with a capital of Rs 2 crore and a fleet of three Lockheed constellation aircraft. Its first flight took off on June 8, 1948 on the Mumbai (Bombay)-London air route. At the time of its nationalization in 1953, it was operating four weekly services between Mumbai-London and two weekly services between Mumbai and Nairobi. The joint venture was headed by J.R.D. Tata, a visionary who had founded the first India airline in 1932 and had himself piloted its inaugural flight The Civil Aviation Sector in India is undergoing a huge transformation over the last few years and is poised to take another quantum leap in the years to come .This is mainly due to the changed travel mindset of the people .Air travel become more affordable to the masses with the growth of the disposable income with the middle class. Indian Middle class is comprising of youth in the age group 25- 40 and hence there is a promising future for the Indian Aviation Industry in the years to come. A very sharp increase in the airtraffic is predicted as flying is no more the privilege of the elite class and due to the liberalization of air travel services. The Indian Airports are not prepared to handle the huge increase in the number of passengers and hence upgradation of the airports and construction of new airports are the only alternatives left with the Controlling...