Cover travel passenger. There are three main models that

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Abstract

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Discuss the advantages and disadvantages
of different airport ground handling models.

 

 

Introduction

 

 

Every countries’ airport ground handling may differ
from one another. Majority of the countries are managing their own airports
ground handling operations by either U.S model, EU model or Third-party model.
This report is to show the comparison of U.S model, EU model and Third-party
model. In addition, also discussing on Changi Airport, Singapore’s ground
handling system.

 

 

Define
the key ground handling models are used around the world

 

 

Ground handing is one of the major key activities for
airport operation. The ground handling can be defined as the myriad of services
provided to an aircraft in preparation for pre-take-off and post-landing of a
flight. Also, not forgetting of those activities carried out before the
aircraft arrives at a terminal gate, those provided during the time the
aircraft is at the gate and those which are accomplished after the aircraft has
departed for its next flight. The ground handling varies in all the countries
and it is also not the same in multiple airports within a same country. Ground
handling operation is advancing due to increasing numbers of air travel
passenger.

 

There are three main models that are used around the
world for ground handling; U.S model, EU model and Third-party model. Please
refer to Figure 1 in appendix for a simplified structure of the ground handling
markets.

 

Firstly, U.S model is very different since small
portion of ground handling is performed by independent organisations. Majority
of the ground handlings carried out in the U.S is managed by dedicated airline
such as United Airline and American Airline. This does not mean that all U.S airport
operates this way, there are other companies out there like Swissport. In
recent days, Swissport Ground Handling business provides passengers and ramp
handling more than 220 stations globally and also providing their services to
more than 224 million passengers in a year. In today world, Swissport is also
known as a huge ground handler with plenty of hubs and low-cost carrier bases
internationally. Below are some of the services that Swissport provides.

 

Passenger Services

Airport
Ticketing Sales Desk
Arrival
and Transfer Services
Check-in
Services
Dedicated
Passenger Services
Gate
Services
Lost
and Found Services
Lounge
Services
Special
Passenger and VIP Services

Aircraft Servicing and Ramp Handling

Aircraft
Loading/Unloading
Baggage
Sorting and Transportation
Cabin
Cleaning
Crew
Transport
De/Anti-Icing
GPU,
Push-Back
Unit
Load Device Control
Toilet
and Water Services

 

Hence, US model basically means that the airlines are
heavily involved in the ground handling activities. The airline will provide
services and equipment for themselves.

 

Secondly, mentioning about EU model for ground
handling, it is not the same as U.S model. Initially for EU model, airport will
operate their ground handling services by itself which is different from US
model where airlines will run their ground handling services. This will be like
a monopoly game as previously it was the norm for ground handling activities in
EU airports. Most of the airlines was unsatisfied for the steep costs and the
lack of quality services. Thus, the European Commission (EC) came up with rules
to reduce and try to put an end to monopolies in EU ground handling activities.
EU models will be under airport authority and which they will be managed by the
government. This allows free contest for most of the ground handling activates
at EU airports, leading in more options for airlines. Having more choices for
airlines means that the service levels will be improved and the fares for
passenger will be lower. In addition, for those services like baggage handling,
ramp handling, fuelling and freight services, the Member State might keep a cap
for number of suppliers.

 

Thirdly, talking about Third-party model, it will be
the combination of one airline providing ground handling service for another
airline and independent company; can be either the airport operator, or another
airline or an independent ground handling company providing ground handling
service simultaneously. ASIG (Aircraft Service International Group) is one of
the largest independent ground handling company originally established in 1947,
it provides a large range of ground handling, fuelling and airport facility
services across North America, Europe, Asia and Central America. ASIG’s parent
group is Menzies Aviation Group. Please refer to Figure 2 in appendix for airports
ground handling that are operated by ASIG.

Hence, from Figure 2 we can see that ASIG provides
ground handling services to a great number of airports. Majority of the
airports are using Third-party model for their ground handling activities, it
will be more common in EU rather than in US since US uses more of their major
airline’s ground handling service for their airports.

 

 

Explain
the relationship between airport and airlines

 

 

Previously, before World War II, there was no or low
demand for air travel compare to post war. However, after the war, things have
changed thus infrastructures and lifestyle became better. Allowing more and
more civilians joining the Air Force which leads them to have vital skills such
as flying. This resulting the evolution of leisure travel and holidays, causing
the number of air travel passenger to increase significantly over the years.
Hence, airports need to work out on their operations in order to cater for the
increasing numbers of air travel passenger. Please refer to Figure 3 for a
better idea on the growth rate of air travel that increases over the decades.

 

Airlines and Airport must work closely together as
they are interdependent. By working together, they can satisfy air
passenger/consumer and will have a better prospect together. Which basically
means that airport will earn from airlines, whereas for airlines they will earn
from air passengers. Airport will earn their profits from airlines by the costs
and charges that airlines have to pay for. Some examples will be:

·       Use
of runways and landing fees

·       Security
charges

·       Passenger
duty

·       Parking
and boarding access charges

·       Air
Traffic Control

·       Environmental
charges, etc.

On the contrary, for airlines, they will earn their
profits from air travellers/cargo suppliers. Thus, both airport and airlines
have common interest like quality services for air passenger, flights that
depart or arrive on time, facilities and cost that can be improved on to meet
passengers’ expectation. Hence, airport and airlines have to work hand-in-hand
as their reputation is interdependent.

Incheon international airport will be a great example
of how they meet their objective and successes the challenges. As of December
2015, they have approximately 90 airlines running at the airport, connecting
186 cities in 54 countries. Hence, the airport could name itself as the hub of
international air transportation in Northeast Asia.

In addition, airport can improve their relationship
with airlines by cutting down the operational cost, at the same time still
providing the same or higher quality of service. This can be done by having
more Third-party ground handling companies and allowing airlines to have their
own preference for their Third-party ground handling company. Better
Third-party ground handling company might help the airlines to save ground
activities time, which allows flights to depart on time. This resulting airline
to save cost and having more profits at the same time.

 

 

Discuss
the advantages and disadvantages of different airport ground handling models

 

 

Firstly, the ground handling operations for U.S model,
mainly relies upon on airline due to effortless access to their equipment and
facilities. This is because if an individual airline company is the operator of
the ground handling, they can plan, customise and design the ground handling
facilities for their needs. This will definitely increase the aircraft
productivity which will result in more profits. However, the downside will be
trading off with time efficiency.

 

Secondly, the ground handling operations for EU model,
mainly relies upon on airport authority. Since it is a high cost sector of airline
business, there will be an increase in profit. With all of the profit the made,
they can invest some on their facilities. This will definitely improve the
service quality, leading passengers to be more enjoyable when they are at the
airport. However, working with one big organisation can cause things to be
similar as monopoly game, cost might be artificially inflated and service
quality might reduce.

 

 

 

 

 

 

 

 

 

 

 

 

Compare
your own country’s airport with different models around the world and identify
the model is used at your own country’s airport

 

 

I will be using Singapore’s Changi Airport to compare
with different models around the world.

 

In Singapore, Changi Airport uses Third-party ground
handling model for their airlines. The two main ground handling companies will
be SATS (Singapore Airport Terminal Services) and Dnata (Dubai National Air
Transport Association). This two companies have been very competent to serve
the airlines at Changi Airport for over the years. In a recent report by
channelnewsasia, SATS introduces augmented reality (AR) glasses across their
ramp handling operations. With the help of these smart glasses, the staffs are
able to scan the visual markers which in a way is similar to QR codes on
baggage and cargo containers. This will improve the efficiency of baggage and
cargo loading, where loading time will be reduced from an hour and 45 minutes.
Therefore, this will allow airline passengers at Changi Airport to have shorter
waiting times for their flights, which will then improve the efficiency and
reputation of Singapore’s carriers and Changi Airport. This shows that how
Third-party ground handling company is keeping up with technology to bring a
better and seamless experience for airlines, which benefited Singapore in
comparison to other countries. On the other hand, this two companies have been
very competitive against each other for over the past few years. In an article
by todayonline, it has indicated that there is a price war between this two
ground handling companies. It stated that they have fought for contracts to
service airlines here. They were willing to lower their rates down by 30
percent which will lower their profits. Airlines are taking advantage of this
by negotiating harder for better contracts with SATS and dnata. This will
naturally reduce the costs of air travel for passengers where airlines can
lower their cost of production. Eventually, making Changi Airport a successful
airport. However, having Third-party ground handling companies is not always
good. An example will be what if SATS and dnata turn collusive, as there is no
guarantee that such competitive behaviour between them will last for long term.
This would result airlines and consumers losing out. Hence, in Singapore,
Competition Commission of Singapore (CCS) will be responsible that this does
not occur to safeguard the interest of airlines and consumers.

 

Hence, the Third-party ground handling operations allow
Singapore’s Changi Airport to be very successful. It is different from other
ground handling models around the world, as Changi Airport does not use U.S
model nor EU model, they have their own specialised Third-party ground handling
operations.

 

 

 

Conclusion

 

 

In conclusion, I personally feel that ground handling
is vital for airlines and airport business. Without proper ground handling, airlines
will not be able to get their necessary equipment or servicing and it may be a
major problem for the airline and air travellers. It will definitely affect the
profits of airlines and airports if the air travellers’ rate decreases. Different
countries will have different types of ground handling operations, each of the
three models will have pros and cons, nothing in this world is perfect. What matter
most is how does a country make full use of their resources to comply with the ground
handling model that they are using. At the end of the day if that model being
used can make profit, it will be a good ground handling model for the country.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Appendix

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Figure
1: Simplified Structure Model (ec.europa.eu)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Figure
2: Airports supplied with ground handling services by ASIG
(Centreforaviation.com)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Figure
3: Revenue passenger kilometres from 1945-2012 (CNN/ICAO)