The Rise of the Gulf Airports

Topics: Delta Air Lines, London Heathrow Airport, World's busiest airports by passenger traffic Pages: 24 (7791 words) Published: October 17, 2014

The rise of the Gulf airports
A threat for Amsterdam Airport Schiphol?
Abstract
The airports of Abu Dhabi, Doha and Dubai, together referred to as the ‘Gulf airports’, will have a combined capacity of 340 million passengers by 2020. Consequently, they are trying to redirect the traditional traffic flows east tot west. This research focused on the possible influence of the Gulf airports on Amsterdam Schiphol Airport. The findings show that the Gulf airports have a good competitive position on the transfer market to and from Southeast Asia and Oceania, but not to Northern and East Asia. They pose no immediate threat, however, Schiphol and the main Dutch airline KLM will have to continue their cooperation in order to minimize this upcoming competition and to ensure a sustainable position of Schiphol as one of the most important hub airport on the transfer market.

Keywords: Hub competition, Gulf airports, Amsterdam Schiphol Airport, Gulf region Table of contents

1. Introduction
After the deregulation of the European aviation market in the period 1992-1997, airlines gained the freedom to adept their strategies to market demand and to reorganize themselves spatially. As the hub-and-spoke network structure was perceived to add value on both the demand and cost side, it consequently became the dominant choice of network structure (Gillen & Morrison, 2005). Amsterdam Airport Schiphol in the Netherlands is the fourth largest airport of Europe, and the main hub of KLM Royal Dutch airline. Airline hubs are essentially airports where passengers change airplanes to reach their final destination (Derudder et al., 2007). By directing multiple flights through a hub, airlines can service more destinations while operating more cost-effectively. Schiphol airport has reached the position of the fourth largest airport in Europe, because it is a hub airport. Without its hub operations, Schiphol would lose its status as one of Europe’s largest and most important airports (Bilotkach & Mueller, 2012). A few rapidly rising players may threaten these operations. Since the beginning of the 21st century the airline industry in the Arabian Gulf has grown extensively, becoming a relatively new player in the international aviation industry. Airlines from the Gulf region, like Emirates, Etihad and Qatar Airlines are rapidly expanding their network over the world, while simultaneously building new hub-airports in their countries of origin. Moreover, taking into consideration the geographical location of the Middle East in comparison with other world regions, its central location offers a perfect gateway to both the Asia-Pacific and Western markets. When the new airports in the Gulf region are finished around 2020, the combined capacity will amount to c. 340 million passengers each year. These developments are likely to have great effect on major European and Asian carriers, as well as their respective hubs (Vespermann et al., 2008). In the academic literature a large amount of research articles are written on airport competition, airport regulation, airline mergers/alliances, and the hub-and-spoke network structure. However, the literature on the development of new airports, the rise of Middle-Eastern carriers and its effect on the airline industry is limited. Therefore, this paper aims to present a clear conclusion based on the existing literature on these developments, and to provide a valid contribution on this trending topic that is expected to have a significant impact on the airline industry in its current state. This paper is a literature review of existing, peer-reviewed articles and official publications of the researched airports. The focus of the paper is Amsterdam Airport Schiphol, and the scope is limited to the effects that the airports of Dubai, Doha and Abu Dhabi might have on Schiphol. In the first part of the paper an overview will be given of the existing streams of literature on the airport market, as well as an...


Bibliography: Adler, N., & Gellman, A. (2012). Strategies For Managing Risk In A Changing Aviation Environment. Journal Of Air Transport Managment , 24-35.
Airbus. (2014, June 11). Airbus And Emirates Agree To Cancel A350 Xwb Order. Opgeroepen Op June 13, 2014, Van Airbus: Http://Www.Airbus.Com/Newsevents/News-Events-Single/Detail/Airbus-And-Emirates-Airline-Agree-To-Cancel-A350-Xwb-Order/
Appold, S
Bilotkach, V., & Mueller, J. (2012). Supply Side Substitutability And Potential Market Power Of Airports: Case Of Amsterdam Schiphol. Utilities Policy , 23, 5-12.
Bruinsma, F., Rietveld, P., & Brons, M. (2000). Comperative Study Of Hub Airports In Europe: Ticket Prices, Travel Time And Reschedulling Costs. Journal Of Economics And Social Geography , 91, 278-292.
Burgthouwt, G., & Dewit, J. (2005). Temporal Configurations Of European Airline Networks. Journal Of Air Transport Management , 11, 185-198.
Burgthouwt, G., Lieshout, R., Zuidberg, J., Dewit, J., & Veldhuis, J. (2008). Concurrentie Analyse Amsterdam Schiphol 2007. Amsterdam: Seo Economisch Onderzoek.
Derudder, B., Devriendt, L., & Witlox, F. (2007). Flying Where You Don 't Want To Go; An Empirical Analysis Of Hubs In The Airline Network. Journal Of Economics And Social Geography , 98 (3), 307-324.
Feiler, G., & Goodovitch, T. (1994). Decline And Growth, Privatization And Protectionism In The Middle East Airline Industry. Journal Of Transport Geography , 55-64.
Franke, M., & John, F. (2011). What Comes Next After The Recession? Airline Industry Scenarios And Potential End Games. Journal Of Air Transport Management , 17, 19-26.
Gillen, D., & Morrison, W. G. (2005). Regulation, Competition And Network Evolution In Aviation. Journal Of Air Transport Management , 11, 161-174.
Grimme, W. (2011). The Growth Of Arabian Airlines From A German Perspective - A Study Of The Impacts Of New Air Services To Asia. Journal Of Air Transport Management , 333-338.
Hansen, M. (1990). Airline Competition In A Hub-Dominated Environment: An Application Of Noncooperative Game Theory. Transportation Research Part B: Methodological , 27-43.
Hooper, P., Walker, S., Moore, C., & Zubaidi, Z. A. (2011). The Development Of The Gulf Region’s Air Transport Networks: The First Century. Journal Of Air Transport Management , 17, 325-332.
Lin, M. (2006). Hub-Airport Competition: Connecting Time Differentiation And Concession Consumption. Australian Economic Papers , 45, 299-317.
Lohmann, G., Albers, S., Koch, B., & Pavlovich, K. (2009). From Hub To Tourist Destination - An Explorative Study Of Singapore And Dubai 's Aviation-Based Transformation. Journal Of Air Transport Management , 205-2011.
Matly, M., & Dillon, L. (2007). Dubai Strategy: Past, Present, Future. Cambridge: Havard Business School.
Murel, M., & O 'connell, J. (2011). Potential For Abu Dhabi, Doha And Dubai Airports To Reach Their Traffic Objectives. Research In Transportation Business & Management , 36-46.
O 'connell, J. F. (2011). The Rise Of The Arabian Gulf Carriers: An Insight Into The Business Model Of Emirates Airlines. Journal Of Air Transport Management , 339-346.
Redondi, R., Malighetti, P., & Paleari, S. (2011). Hub Competition And Travel Times In The World-Wide Airport Network. Journal Of Transport Geography , 19, 1260-1271.
Reynolds-Feighan, A., & Mclay, P. (2006). Accessibility And Attractiveness Of European Airports: A Simple Small Community Perspective. Journal Of Air Transport Management , 313-323.
Rietveld, P., & Brons, M. (2001). Quality Of Hub-And-Spoke Networks: The Effects Of Timetable Co-Ordination On Waiting Time And Rescheduling Time. Journal Of Air Transport Management , 7, 241-249.
Schiphol Group. (2013). Jaarverslag. Amsterdam: Schiphol Group.
Skytrax. (2014, March 26). World Airport Awards 2014. Opgeroepen Op June 13, 2014, Van World Airport Awards 2014: Http://Www.Worldairportawards.Com/Awards_2014/Categories.Htm
Sull, D
Tretheway, M., & Kincaid, I. (2010). Competition Between Airports; Occurrence And Strategy. In P. Forsyth, D. Gillen, J. Muller, & H. Niemeier, Airport Competition. The European Experience (Pp. 119-136). Alderschot: Ashgate.
Vespermann, J., Wald, A., & Gleich, R. (2008). Aviation Growth In The Middle East - Impacts On Incumbent Players And Potential Strategic Reactions. Journal Of Transport Geography , 16, 388-394.
Walters, T., Kadragic, L., & Walters, L. (2006). Miracle Or Mirage: Is Developement Sustainable In The United Arab Emirates? Middle East Review Of International Affairs , 10 (3), 77-91.
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • The Persian Gulf
  • Airport Operation Essay
  • Essay about Airport
  • Essay on airport systems
  • airport lounge Essay
  • The Rise Essay
  • Heathrow airport Essay
  • AIRPORT Essay

Become a StudyMode Member

Sign Up - It's Free