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Low-Cost Airports for Low-Cost Airlines: Flexible Design to Manage the Risks

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  • Richard De Neufville

Abstract

Airport planning is shifting from the traditional pattern -- driven by long-term point forecasts, high standards, and established clients -- to that of recognizing great forecast uncertainty, many standards and changeable clients. This is a consequence of economic deregulation of aviation and the rise of low-cost airlines. Low-cost airlines are becoming significant factors in airport planning. Their requirements differ from those of ‘legacy’ carriers. They drive the development of secondary airports and cheaper airport terminals. They catalyze ‘low-cost airports’ around the ‘legacy main airports’ built for the ‘legacy airlines’. This paper proposes a flexible design strategy to deal with the uncertainty of this dynamic. This differs significantly from traditional airport master planning. It builds flexibility into the design, to enable airports to adjust to changes in the type, needs and location of traffic. The case of Portugal illustrates the current risks, and indicates how flexible design could manage uncertainties and maximize expected value.

Suggested Citation

  • Richard De Neufville, 2007. "Low-Cost Airports for Low-Cost Airlines: Flexible Design to Manage the Risks," Transportation Planning and Technology, Taylor & Francis Journals, vol. 31(1), pages 35-68, November.
    • Handle: RePEc:taf:transp:v:31:y:2007:i:1:p:35-68
    DOI: 10.1080/03081060701835688
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    1. de Neufville, Richard, 1995. "Management of multi-airport systems," Journal of Air Transport Management, Elsevier, vol. 2(2), pages 99-110.
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    Cited by:

    1. Andrea Migliardi & Valter Di Giacinto, 2013. "Low cost carriers and foreign tourism in Italy: a cointegrated VAR analysis," ERSA conference papers ersa13p47, European Regional Science Association.
    2. Martín, Juan Carlos & Rodríguez-Déniz, Héctor & Voltes-Dorta, Augusto, 2013. "Determinants of airport cost flexibility in a context of economic recession," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 57(C), pages 70-84.
    3. Benedikt Badanik & Isabelle Laplace & Nathalie Lenoir & Estelle Malavolti, 2010. "Future strategies for airports," Post-Print hal-01022230, HAL.
    4. Benedikt Badanik & Isabelle Laplace & Nathalie Lenoir & Estelle Malavolti & Anna Tomova & Antonin Kazda, 2010. "Future strategies for airports," Post-Print hal-01023861, HAL.

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