most important economies
increasing economy lead to lower marginal costs
Economy of technology:
- newer plane have a lower CASK
- smaller plane are able to fly longer distances
Economy of scale:
- bigger plane have a lower CAKS
- bigger airport have a lower PAX (larger catering facility)
Economy of scope: network
-bigger airline offer more OD with comparably few legs
Economy of density:
-airline dominating a hub has comparably higher market shares. big hubs offer improved and optimized services (lounge, shopping)
structure and element of the aviation service chain
where the air ticket turnover goes to?
Aircraft manufacturer 7%
Aircraft leasing company 30%
airports 26%
ground service 6%
tech. support 6%
Computer reservation system 15%
Airline 3%
how airline spend you airfare
30% fuel
20% salary
16% ownership costs
14% government, fees, taxes
11% maintenance
1% profit
success factor of airports
size and Pax no., depending on
- local demand
- role of airport in the airline industry (we need an hub carrier, doesn’t matter who. direct access to the world is important)
- cost structure (procurement, outsourcing, air traffic control)
Pragmatic cooperation & outsourcing
Non aviation revenues
reasonable ration in balance sheets
development perspectives, political legitimation
strategic success factor for airlines
Economies of scale and scope
- through internal network effect
- through integration or strategic alliances
Cost efficiency and brand quality
good financial ratio
-equity / total capital, share of leased plane, SLF, CASK, RASK
strategic success factor for aircraft manufacturer
- technology (fuel efficiency & reliance) –> constant development
- product platforms
- timed renewal
what does influence a business model
airport development
airlines routes, alliances
technology
