An effort to educate (world airline strategy)

typhoonpilot

Well-Known Member
Pay attention to the graphs Seggy:


Airport expansion: It's build, build, build in much of the world
By Naomi Grimley Global affairs correspondent
  • 29 June 2015
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Radical departure: Designs for Istanbul's slick new airport, and its existing site (bottom, right)
A three-year review into the future of air travel around London is due to finish with the recommendation that a new runway be built at one of two existing airports. But while the capital gingerly edges towards airport expansion, other parts of the world are witnessing a massive airport building boom.

Along the Black Sea coast, 21 miles (35km) from Istanbul, an army of trucks and construction workers are labouring round the clock to build one of the world's biggest airports. The project was only announced two years ago by the Turkish government and yet it's due to open in 2018. Once fully complete, it will boast six runways and cater for 150 million passengers a year, travelling to 350 destinations. Or to put it another way, it will have more than twice the capacity of London Heathrow.

Never mind its size, the speed of this project alone is breath-taking. In the UK's South East region, on the other hand, it has taken several decades - and many official reports - to decide where to build a new runway. As the latest independent commission prepares to deliver its proposals, how are other countries managing the rise in air traffic, and is the growth in passengers really set to go on and on?
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Temples of glass and steel
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It's not just Turkey that's got its eyes on the prize of glittering glass and steel terminals. New shiny airports are in the pipeline in many of the world's growing cities. Mexico City is currently building the biggest airport in the Americas, designed by Norman Foster. Meanwhile, south of Beijing, construction is under way to build a new airport, Daxing, on an area of land the size of Bermuda. Consultants KPMG has calculated 50 new runways will be built in the world's major cities by 2036. Seventeen of them will be in China alone. "These are not vanity projects," says James Stamp, KPMG's global head of aviation, "these countries know they need airports as part of their essential infrastructure to support their economic growth."

Air traffic keeps ascending
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Ever since the beginning of aviation itself, air traffic has continued to grow. This upward curve has been amazingly resilient to external shocks over the years. Oil price spikes, the 9/11 attacks and SARS, a respiratory illness the spread of which was fuelled by air travel, may each have caused a temporary dent, but traffic always seems to pick up again. If you want to gaze into the crystal ball of aviation, perhaps the best place to look is the future order books of plane manufacturers - such as Boeing and Airbus. According to the policy wonks at Airbus, air traffic is going to double in the next 15 years.


Rising middle classes
Both Boeing and Airbus believe that much of that increase will come from emerging economies, citing a direct link between air travel and economic prosperity. It will be fuelled by the rise of more affluent households especially in China and India. As Boeing's future market report puts it, "air travel is one of the first discretionary expenditures to be added as consumers join the global middle class." It's these demographics - and the global economy's shifting centre of gravity - which explain why the Asia Pacific region will become the largest air travel market in the world. In 1993, more than 73% of air traffic was carried by airlines in Europe or North America. By 2033, that will shrink to 38%, as the Asian and Middle Eastern carriers take centre stage.

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Traffic moving eastwards
We've already seen how fast the global aviation market is changing with the rise of Dubai as a major hub airport - or "mega-hub". In 2008, the then chief executive of British Airways, Willie Walsh, warned Dubai would allow air traffic to bypass European hubs by providing a link between Asia and North America. Astoundingly, back then Dubai didn't even feature in league tables of the world's busiest airports.

It has now overtaken London Heathrow on international passenger numbers - ending Heathrow's decades-long dominance as the world's top international hub. Some aviation experts question whether hub airports are really the future. But Dubai is banking on yet more growth. Once its World Central Airport project is finished, it will boast more passenger capacity than all five of London's airports combined. Oxford Economics, the global research company, forecasts that by 2020, 37.5% of Dubai's GDP will come from the aviation sector and related industries.

The next Dubai
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That's why others now want to emulate the Dubai model. Ethiopia is one of Africa's fastest growing economies and, because it sits on the edge of two regions, Africa and the Middle East, it's hoping to acquire a similar mega-hub status. The hunt is now under way for possible sites for a new airport which will handle 10 times the number of passengers that currently pass though Bole International Airport in Addis Ababa. The state-owned Ethiopian Airlines is already expanding its fleet in anticipation of this added capacity. That way, it hopes to copy the canny strategy of Emirates by providing more aircraft to fly to more destinations - growing in tandem with an expanding hub airport.

Inexorable rise?
No one really knows whether long-term aviation will continue growing as it has so far. Even those who are building the new generation of airports wonder aloud if the trend will hold. Dervilla Mitchell, an aviation expert from the engineering firm Arup, points to evolving new technologies. "Eventually," she says, "the tipping point will come when the virtual meeting is so effective it will reduce the need for business travel altogether." As emerging economies mature, they may also find more public resistance to airport expansion with environmental concerns rising to the surface. For the moment, though, UK business leaders look jealously at what's happening abroad, and wish Britain would get a move on with building its first full-length runway in the South East since World War Two.
 
Seems to be more of an issue of, "political will", policy, and simply just the rest of the world catching up to North America/Europe..
 
@typhoonpilot , I don't need an education on this. You say nothing above I don't already know.

What I have a problem with is the fact that the ME3 carriers are subsidized and it creates an uneven playing field. If the ME3 lobby and are allowed to starts service, say from LAX/SFO/SEA to China with subsidized airplanes, subsidized on-board services, no labor laws to worry about, etc., @Derg might was well rename this site www.jetcareersinthemiddleeast.com
 
@typhoonpilot , I don't need an education on this. You say nothing above I don't already know.

What I have a problem with is the fact that the ME3 carriers are subsidized and it creates an uneven playing field. If the ME3 lobby and are allowed to starts service, say from LAX/SFO/SEA to China with subsidized airplanes, subsidized on-board services, no labor laws to worry about, etc., @Derg might was well rename this site www.jetcareersinthemiddleeast.com

At least there will be soccer there... Silver linings?
 
@typhoonpilot , I don't need an education on this. You say nothing above I don't already know.

What I have a problem with is the fact that the ME3 carriers are subsidized and it creates an uneven playing field. If the ME3 lobby and are allowed to starts service, say from LAX/SFO/SEA to China with subsidized airplanes, subsidized on-board services, no labor laws to worry about, etc., @Derg might was well rename this site www.jetcareersinthemiddleeast.com


More light reading for you, just out today:

http://www.emirates.com/us/english/about/open-skies-rebuttal-download.aspx


TP
 
The first minute of this is very appropriate to Seggy's position. Just substitute Seggy for Bob Rumson.


Markets change Seggy. You're too young to remember when Pan Am and TWA were the two big international carriers. They failed to survive because they did not adapt to the changing marketplace. You can cry all you want about the changing marketplace and keep up with the protectionist agenda. It will only result in the failure of American carriers to adapt to the world market which will make your worst fears come true.

I'd be fully supportive of movements by ALPA and other coalitions to get more route rights into China and other growing markets. Full supportive of more 5th and 7th freedom flying for U.S. carriers. Fully supportive of government backed financing for U.S. carriers akin to what the Ex-Im gives foreign carriers. Go with those issues, they are the ones that will help American carriers in the changing marketplace over the long term.



Typhoonpilot
 
Whilst I agree with the notion that, eventually, protectionism will go the way of the Dodo, this is not a legitimate argument for just tossing that particular baby out with the bathwater this moment. There might be an argument to be made that such a thing would benefit future generations of Americans (or whatever they're calling themselves in 50 or 100 years), but it's fairly cut and dried that for anyone who is currently sucking down air and is flying or wants to fly for a US carrier, that would be an unmitigated disaster. We've seen how this thing plays out in the tech sector, haven't we? "Herro! My name is, uh, Jane, how may I herp roo?"

It's also worth noting that the opening of trade, destruction of trade barriers, and, well, how to put it delicately? "One World"ing seems always to benefit one side more than the other. And just why do you imagine that might be?
 
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Whilst I agree with the notion that, eventually, protectionism will go the way of the Dodo, this is not a legitimate argument for just tossing that particular baby out with the bathwater this moment. There might be an argument to be made that such a thing would benefit future generations of Americans (or whatever they're calling themselves in 50 or 100 years), but it's fairly cut and dried that for anyone who is currently sucking down air and is flying or wants to fly for a US carrier, that would be an unmitigated disaster. We've seen how this thing plays out in the tech sector, haven't we? "Herro! My name is, uh, Jane, how may I herp roo?"

It's also worth noting that the opening of trade, destruction of trade barriers, and, well, how to put it delicately? "One World"ing seems always to benefit one side more than the other. And just why do you imagine that might be?


Oh, you mean Apple has $100 billion in cash because they only sell their products in America? How about Microsoft, Caterpillar, Boeing, IBM, HP, etc, etc.?

What's fairly clear to me, someone who is working in the international airline industry, is that the growth in air travel worldwide is pretty incredible; the U.S. carriers are not making the right moves to try to capture that growth; and young pilots who fly domestic in the USA believe the tripe that ALPA puts out. Continuation of that course of action for the U.S. carriers is what will be the unmitigated disaster over the long term.


Typhoonpilot
 
Oh, you mean Apple has $100 billion in cash because they only sell their products in America? How about Microsoft, Caterpillar, Boeing, IBM, HP, etc, etc.?

What's fairly clear to me, someone who is working in the international airline industry, is that the growth in air travel worldwide is pretty incredible; the U.S. carriers are not making the right moves to try to capture that growth; and young pilots who fly domestic in the USA believe the tripe that ALPA puts out. Continuation of that course of action for the U.S. carriers is what will be the unmitigated disaster over the long term.


Typhoonpilot

Do you offer your crystal ball for rent? Or know where I can buy one?
 
Do you offer your crystal ball for rent? Or know where I can buy one?


ALPA went down the wrong road with RJs and now they are going down the wrong road with this issue. You just don't see the growth in air travel unless you are constantly traversing the globe. When I went to work in Taiwan in 1995 there were only 300-400 commercial airliners in all of China, and that includes old Tupolevs. Now there are closer to 2500. The same kind of growth is happening in India, Indonesia, Malaysia, Thailand, Eastern Europe, etc. Passengers first start flying domestically, then they progress to short international flights, and then finally long international flights. It's Emirates, Etihad, Qatar, and others who are taking advantage of this growth all while U.S. carriers sit back crying, "they're stealing our passengers".

They are not stealing your passengers. These are generally new passengers from new markets that the U.S. carriers and their alliance partners have failed to effectively capture.



Typhoonpilot
 
I for one am very appreciative of what Typhoon Pilot has been posting here. I have been concerned about the trend in global economics and the outlook for US Mainline Carriers. However, I didn't have the background or familiarity with the subject to understand it very well, certainly not enough to post about it on JC. Regardless it seems as if my suspicions are correct as to the developing trends in Mainline 121 operations.

I think bottom line pilots need to educate themselves to stop the race to the bottom. Certainly those who are hopeful for a mainline 121 job should be educating themselves on what the repercussions will be for mainline pilots if the current trends continue.

Trans Pacific Partnership anyone? I wonder what is in that? Since no one will tell the little people. Like you and I.
 
I think the important thing to take from this is the other countries treat commercial aviation as a priority. In the US it's viewed as a cash cow, various government agencies tacking on tax after tax. An air traffic system that is reactive vs proactive. Limited investment in infrastructure. Millions siphoned off to serve EAS which serves few passengers.

Hell, just think of the experience from a passenger standpoint today.

Flying used to be an exciting experience, people looked forward to it. Now, it's a chore to even get through security. Employees treat passengers as an inconvenience vs. the source that pays their mortgage.
 
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