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Infrastructure “headache”
Aviation leaders at the region’s premier airline gathering once again highlighted the fact that the shortfall in infrastructure development across the Asia-Pacific is hindering growth and costing airlines money.
December 1st 2014
He stopped short of calling it a crisis, but the director general of the region’s leading airline body repeated that airline infrastructure remains a major problem for the Asia-Pacific airlines as they surge in growth. Read More » It remains a “big headache” said the Association of Asia-Pacific Airlines’ (AAPA), Andrew Herdman.
Airlines executives at the AAPA’s annual Assembly of Presidents, this year hosted by All Nippon Airways in Tokyo, agreed their airlines faced restrained market access as infrastructure failed to keep pace with growth. Delegates heard that airways congestion, too few runways, bulging terminals and ATM clearance restrictions were not being sufficiently resolved by governments and their stakeholders and remained a problem of priority for carriers.
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| Garuda Indonesia’s Emirsyah Satar: a study by his airline revealed the carrier spent US$34 million a year on fuel “just queuing and flying around” |
President of Garuda Indonesia, Emirsyah Satar, whose Jakarta headquartered airline operates from one of the most congested airports in the world, said the Jakarta facilities were limiting the carrier’s growth.
“Unfortunately, passenger growth exceeds infrastructure growth, so it is costing us,” he said. “We did a study last year to determine how much more fuel we burn because of congestion. At the time, it was costing us US$34 million a year for additional fuel because of queuing and flying around. And that was only us.”
The Garuda president, who announced the 2015 AAPA Asssembly of Presidents would be held in Bali, said the airline and its stakeholders were examining the option of building their own facilities, particularly because of the high charges, which continue to increase, imposed by some airport operators.
It is not all gloom and doom, however. Satar said Indonesia’s recently elected government was focused on building infrastructure. “We always have to be optimists. They have already managed to increase the number of take-offs and landings at Jakarta from 66 to 72 by changing the system and investing in new equipment. We expect that target to increase by another 10% to 15% without building new runways. But yes, the current situation does give us inefficiencies,” he said.
Cathay Pacific Airways chief operating officer, Rupert Hogg, pointed out that congestion was not only happening in Hong Kong, but in many other of the airline’s destinations. “It is a problem for us. We have a plan that will give us the growth we need in the next ten years,” he said.
“We have bought a lot of long-haul aircraft because we want to keep building the network by frequency and destination. So, we will have to start trading slots around our portfolio of slots - if you like - to ensure we grow the way we want to grow. We always work with the relevant authorities to see how we can improve things.”
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At an Assembly media briefing, Herdman said new facilities are being built, but rarely fast enough for an industry which is growing at a rate of 5% annually. In some countries with up to 10% growth, such as China, infrastructure development needs to double every six years to simply keep pace with airline expansion. These “doubling periods” mean that when airports open they are operating at full capacity, he said. Herdman identified Indonesia, particularly Jakarta, the Philippines, India and Hong Kong as “trouble spots”.
The AAPA is pressing governments to act more as regulators and planners rather than owners and architects. “We need to call on the regulators. Government has a role to play, even if it is not financing,” he said.
