Share:


The connection between an airport type and revenue structure at Baltic States airports

    Kristine Uzule   Affiliation
    ; Irina Kuzmina-Merlino   Affiliation

Abstract

Airports are not only engines of transportation of passengers and cargo, but also commercial enterprises offering services far beyond transportation, which is why their revenues are formed by both aeronautical and non-aeronautical sales. Aeronautical revenues of some large European airports are higher than non-aeronautical revenues, whereas some regional and secondary European airports demonstrate the opposite trend. The aim of this research was to determine if there is a connection between an airport type and the ratio of aeronautical and non-aeronautical revenues at Baltic States airports in way that is consistent with the previous research. The aim was attained in three stages. The first, the definitions of the main and secondary airports were constructed via discourse analysis. The second, the structure of airport revenues of the selected Baltic States airports was analysed. The third, conclusions were made regarding a connection between an airport type and the revenue structure of these Baltic States airports. On the one hand, the research results suggested there might be a connection between an airport type and the revenue structure although this question requires further research, and on the other hand, the financial analysis showed that airports with a higher share of non-aeronautical revenues than aeronautical revenues were more resilient to crises.

Keyword : airport types, discourse analysis, financial analysis, aeronautical revenues, non-aeronautical revenues

How to Cite
Uzule, K., & Kuzmina-Merlino, I. (2022). The connection between an airport type and revenue structure at Baltic States airports. Aviation, 26(4), 183–194. https://doi.org/10.3846/aviation.2022.17854
Published in Issue
Nov 28, 2022
Abstract Views
522
PDF Downloads
489
Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

References

Adikariwattage, V., De Barros, A. G., Wisasinghe, S. C., & Ruwanpura, J. (2012). Airport classification criteria based on passenger characteristics and terminal size. Journal of Air Transport Management, 24, 36–41. https://doi.org/10.1016/j.jairtraman.2012.06.004

Airport Council International. (2018). World report December: News and events from the voice of the world’s airports. https://issuu.com/aciworld/docs/aciworldreportdecember2018

Airport Council International. (2019). Annual report for 2018. Montreal, Canada.

Airports Council International. (2020). ACI report shows the importance of the airport industry to the global economy. https://aci.aero/2020/04/22/aci-report-shows-the-importance-of-the-airport-industry-to-the-global-economy/

Airport Liepāja. (n.d.). Vēsture. https://liepaja-airport.lv/lv/par-lidostu/par-lidostu/vesture/

Albayrak, M. B. K., Ozcan, I. C., Can, R., & Dobruszkes, F. (2020). The determinants of air passenger traffic at Turkish airports. Journal of Air Transport Management, 86, 101818. https://doi.org/10.1016/j.jairtraman.2020.101818

Alves, C. J. P., Da Silva, E. J., Muller, C., Borile, G. M. R., Guterres, M. X., Arraut, E. M., Peres, M. S., & Dos Santos, R. J. (2020). Towards an objective decision-making framework for regional airport site selection. Journal of Air Transport Management, 89, 101888. https://doi.org/10.1016/j.jairtraman.2020.101888

Ballart, X., & Guell, C. (2015). Airport ownership and regulation in Spain: Explaining the resistance to change. Journal of Air Transport Management, 47, 112–118. https://doi.org/10.1016/j.jairtraman.2015.05.008

Battal, U., & Bakir, M. (2017). The current situation and change in airport revenues: Research on the Europe’s five busiest airports. International Journal of Academic Research in Business and Social Sciences, 7(7), 287–303. https://doi.org/10.6007/IJARBSS/v7-i7/3096

Bergantino, A. S., Capurso, M., & Hess, S. (2020). Modelling regional accessibility to airports using discrete choice models: An application to a system of regional airports. Transportation Research Part A, 132, 855–871.0 https://doi.org/10.1016/j.tra.2019.12.012

Breindenbach, P. (2020). Ready for take-off? The economic effects of regional airport expansions in Germany. Regional Studies, 54(8), 1084–1097. https://doi.org/10.1080/00343404.2019.1659948

Cervinka, M. (2019). Is a regional airports business a way to make a profit? Transportation Research Procedia, 43, 84–92. https://doi.org/10.1016/j.trpro.2019.12.022

Cattaneo, M., Malighetti, P., & Percoco, M. (2018). The impact of intercontinental air accessibility on local economies: Evidence from the de-hubbing of Malpensa airport. Transport Policy, 61, 96–105. https://doi.org/10.1016/j.tranpol.2017.10.009

Chaouk, M., Pagliari, R., & Moxon, R. (2020). The impact of national macro-environment exogenous variables on airport efficiency. Journal of Air Transport Management, 82, 101740. https://doi.org/10.1016/j.jairtraman.2019.101740

Choo, Y. Y. (2014). Factors affecting aeronautical charges at major US airports. Transportation Research Part A, 62, 54–62. https://doi.org/10.1016/j.tra.2014.02.006

Choo, Y. Y., Corbo, L., & Want, K. (2018). Joint impact of airline market structure and airport ownership on airport market power and profit margin. Transport Policy, 72, 67–78. https://doi.org/10.1016/j.tranpol.2018.09.017

Christensen, L., Nielsen, O. A., Rich, J., & Knudsen, M. (2020). Optimizing airport infrastructure for a country: The case of Greenland. Research in Transportation Economics, 79, 100773. https://doi.org/10.1016/j.retrec.2019.100773

Christidis, P. (2016). Four shades of Open Skies: European Union and four main external partners. Journal of Transport Geography, 50, 105–114. https://doi.org/10.1016/j.jtrangeo.2015.04.005

Davis, A. R. (2019). Thematic roles. In C. Maienborn, K. von Heusinger, & P. Portner (Eds.), Semantics – lexical structures and adjectives (pp. 99–125). De Gruyter Mouton. https://doi.org/10.1515/9783110626391-003

Debyser, A. (2016). Airports in the EU: In-depth analysis. EPRS, European Parliamentary Research Service.

Dobruszkes, F. (2013). The geography of European low-cost airline networks: A contemporary analysis. Journal of Transport Geography, 28, 75–88. https://doi.org/10.1016/j.jtrangeo.2012.10.012

Eurocontrol. (2019). Comparison of air traffic management-related operational performance: U.S. / Europe. Eurocontrol.

European Commission. (2005). Community guidelines on financing of airports and start-up aid to airlines departing from regional airports. Official Journal of the European Union, 312/01, 1–14.

Fageda, X. (2014). What hurts the dominant airlines at hub airports? Transportation Research Part E, 70, 177–189. https://doi.org/10.1016/j.tre.2014.07.002

Fasone, V., Kofler, L., & Scuderi, R. (2016). Business performance of airports: Non-aeronautical revenues and their determinants. Journal of Air Transport Management, 53, 35–45. https://doi.org/10.1016/j.jairtraman.2015.12.012

Federal Aviation Administration. (2022). Airport categories. https://www.faa.gov/airports/planning_capacity/categories

Fernandes, V. A., Pacheco, R. R., Fernandes, E., & Da Silva, W. R. (2019). Regional change in the hierarchy of Brazilian airports 2007–2016. Journal of Transport Geography, 79, 102467. https://doi.org/10.1016/j.jtrangeo.2019.102467

Florido-Benitez, L. (2021). Malage Costa del Sol airport and its new conceptualization of hinterland. Tourism Critiques: Practice and Theory, 2(2), 195–221. https://doi.org/10.1108/TRC-05-2021-0010

Fragoudaki, A., & Giokas, D. (2020). Airport efficiency in the dawn of privatization: The case of Greece. Journal of Air Transport Management, 86, 101821. https://doi.org/10.1016/j.jairtraman.2020.101821

Fuerst, F., Gross, S., & Klose, U. (2011). The sky is the limit? The determinants and constraints of European airports commercial revenues. Journal of Air Transport Management, 17(5), 278–283. https://doi.org/10.1016/j.jairtraman.2011.03.001

Fuerst, F., & Gross, S. (2018). The commercial performance of global airports. Transport Policy, 61(C), 123–131. https://doi.org/10.1016/j.tranpol.2017.08.005

Gao, Y., & Sobieralski, J. B. (2021). Spatial and operational factors behind passenger yield of U.S. nonhub primary airports. Journal of Air Transport Management, 90, 101967. https://doi.org/10.1016/j.jairtraman.2020.101967

Gutierrez, E., & Lozano, S. (2016). Efficiency assessment and output maximization possibilities of European small and medium sized airports. Research in Transportation Economics, 56, 3–14. https://doi.org/10.1016/j.retrec.2016.07.001

Halpern, N., Mwesiumo, D., Suau-Sanchez, Budd, T., & Brathen, S. (2021). Ready for digital transformation? The effect of organizational readiness, innovation, airport size and ownership on digital change at airports. Journal of Air Transport Management, 90, 101949. https://doi.org/10.1016/j.jairtraman.2020.101949

Han, H., Yu, J., & Kim, W. (2018). Airport shopping – an emerging non-aviation business: Triggers of traveler loyalty. Journal of Travel and Tourism Marketing, 35(7), 835–845. https://doi.org/10.1080/10548408.2017.1422454

Harley, G., Timmis, A., & Budd, L. (2020). Factors affecting environmental practice adoption at small European airports: An investigation. Transport Research Part D, 88, 102572. https://doi.org/10.1016/j.trd.2020.102572

Heathrow. (2020). Annual report and financial statements 2020. https://www.heathrow.com/content/dam/heathrow/web/common/documents/company/investor/reports-and-presentations/annual-accounts/airport-ltd/Heathrow-Airport-Limited-31-Dec-2020.pdf

Heathrow. (2018). Heathrow airport limited. Annual report and financial statements for the year ended 31 December 2018. https://www.heathrow.com/content/dam/heathrow/web/common/documents/company/investor/reports-and-presentations/annual-accounts/airport-ltd/Heathrow-Airport-Limited-31-December-2018.pdf

Heathrow. (2017). Heathrow airport limited. Annual report and financial statements for the year ended 31 December 2017. https://www.heathrow.com/content/dam/heathrow/web/common/documents/company/investor/reports-and-presentations/annual-accounts/airport-ltd/Heathrow-Airport-Limited-31-December-2017.pdf

Hotle, S., & Mumbower, S. (2021). The impact of COVID-10 on domestic U.S. air travel operations and commercial airport service. Transportation Research Interdisciplinary Perspectives, 9, 100277. https://doi.org/10.1016/j.trip.2020.100277

Huang, W., Lin, Y., Lin, B., & Zhao, L. (2019). Modeling and predicting the occupancy in a China hub airport terminal using Wi-Fi data. Energy and Buildings, 203, 109439. https://doi.org/10.1016/j.enbuild.2019.109439

International Civil Aeronautical Organization. (2015). State of airport economics. https://www.icao.int/sustainability/Airport_Economics/State%20of%20Airport%20Economics.pdf

Jiang, Y., Lu, J., Feng, R., & Yang, Z. (2020). Determinants of wave-system structures of network airlines at hub airports. Journal of Air Transport Management, 88, 101871. https://doi.org/10.1016/j.jairtraman.2020.101871

Jimenez, E., & Suau-Sanchez, P. (2020). Reinterpreting the role of primary and secondary airports in low-cost carrier expansion in Europe. Journal of Transport Geography, 88, 102847. https://doi.org/10.1016/j.jtrangeo.2020.102847

Karanki, F., Lim, S. H., & Choi, B. J. (2020). The determinants of aeronautical charges of U.S. airports: A spatial analysis. Journal of Air Transport Management, 86, 101825. https://doi.org/10.1016/j.jairtraman.2020.101825

Kazda, A., Turiak, M., & Gotz, K. (2020). Airport typology for LCC policy changes: A European perspective. Aeronautical, 24(3), 90–98. https://doi.org/10.3846/aviation.2020.12051

Kauno oro uostas. (2018). Traffic report 2018. https://www.ltou.lt/uploads/documents/files/corporate/aircraft-services/Statistics/KUN%20statistics_2018_EN.pdf

Keumi, C., & Murakami, H. (2012). The role of schedule delays on passengers’ choice of access modes: A case study of Japan’s international hub airports. Transportation Research Part E, 48, 1023–1031. https://doi.org/10.1016/j.tre.2012.03.005

Klophaus, R., Merkert, R., & Lordan, O. (2021). Mesh network as a competitive advantage for European LCCs: An alternative topology to hub-and-spoke for selling online connections. Transport Policy, 106, 196–204. https://doi.org/10.1016/j.tranpol.2021.04.012

Kutlu, L., & McCarthy, P. (2016). US airport ownership, efficiency, and heterogeneity. Transportation Research Part E, 89, 117–132. https://doi.org/10.1016/j.tre.2016.03.003

Lithuanian airports. (2020). Annual activity report for the year 2020. https://www.ltou.lt/uploads/documents/files/corporate/activities/Annual%20reports/LOU_Annual_Report_05%2017-compressed.pdf

Lithuanian airports. (2022). About Lithuanian airports. https://www.ltou.lt/en/about-lithuanian-airports

Liu, M.-B., & Liao, S.-M. (2018). A case study on the underground rapid transport system (URTS) for the international airport hubs: Planning, application and lessons learnt. Tunnelling and Underground Space Technology, 80, 114–122. https://doi.org/10.1016/j.tust.2018.06.004

Lordan, O., & Sallan, J. M. (2017). Analyzing the multilevel structure of the European airport network. Chinese Journal of Aeronautics, 30(2), 554–560. https://doi.org/10.1016/j.cja.2017.01.013

Lordan, O., & Sallan, J. M. (2019). Core and critical cities of global region airport networks. Physica A, 513, 724–733. https://doi.org/10.1016/j.physa.2018.08.123

Malighetti, P., Paleari, S., & Redondi, R. (2009). Airport classification and functionality within the European network. Problems and Perspectives in Management, 7(1), 182–196.

Martin, J. C., Marin-Domingo, L., Lohmann, G., & Spasojevic, B. (2019). The role of travel patterns in airport duty-free shopping satisfaction: A case study from an Australian regional airport. Journal of Air Transport Management, 80, 101691. https://doi.org/10.1016/j.jairtraman.2019.101691

Mashhoodi, B., & Van Timmeren, A. (2020). Airport location in European airport regions: Five typologies based on the regional road network and land use data. Data in Brief, 29, 105317. https://doi.org/10.1016/j.dib.2020.105317

Matsumoto, H., & Domae, K. (2018). The effects of new international airports and air-freight integrator’s hubs on the mobility of cities in urban hierarchies: A case study in East and Southeast Asia. Journal of Air Transport Management, 71, 160–166. https://doi.org/10.1016/j.jairtraman.2018.04.003

Minato, N., & Morimoto, R. (2011). Designing the commercial sustainability of unprofitable regional airports using system dynamics analysis. Research in Transportation Business and Management, 1, 80–90. https://doi.org/10.1016/j.rtbm.2011.06.009

Mueller, F., & Aravazhi, A. (2020). A new generalized travel cost based connectivity metric applied to Scandinavian airports. Transportation Research Part D, 81, 102280. https://doi.org/10.1016/j.trd.2020.102280

Niewiadomski, P. (2020). Agentisation of airports and the pursuit of regional development in Poland. European Urban and Regional Studies, 27(1), 171–188. https://doi.org/10.1177/0969776419832065

Nommik, A., & Antov, D. (2020). European regional airport: Factors influencing efficiency. Transport and Telecommunication, 21(3), 211–220. https://doi.org/10.2478/ttj-2020-0017

Nommik, A., & Antov, D. (2017). Modelling regional airport capacity. Procedia Engineering, 178, 427–434. https://doi.org/10.1016/j.proeng.2017.01.083

Pacagnella Junior, A. C., Hollaender, P. S., Mazzanati, G. V., & Bortoletto, W. W. (2021). Efficiency drivers of international airports: A worldwide benchmarking study. Journal of Air Transport Management, 90, 1–12. https://doi.org/10.1016/j.jairtraman.2020.101960

Pagliari, R., & Graham, A. (2019). An exploratory analysis of the effects of ownership change on airport competition. Transport Policy, 78, 76–85. https://doi.org/10.1016/j.tranpol.2019.04.004

Paraschi, E. P., Georgopoulos, A., & Papatheodoru, A. (2020). Abiotic determinants of airport performance: Insights from a global survey. Transport Policy, 85, 33–53. https://doi.org/10.1016/j.tranpol.2019.10.017

Paraschi, E. P., Georgopoulos, A., & Kaldis, P. (2019). Airport business excellence model: A holistic performance management system. Tourism Management, 72, 352–372. https://doi.org/10.1016/j.tourman.2018.12.014

Plitz, C., Voltes-Dorta, A., & Suau-Sanchez, P. (2018). A comparative analysis of hub connections of European and Asian airports against Middle Eastern hubs in intercontinental markets. Journal of Air Transport Management, 66, 1–12. https://doi.org/10.1016/j.jairtraman.2017.09.006

Postorino, M. N., & Pratico, F. G. (2012). An application of the multi-criteria decision-making analysis to a regional multi-airport system. Research in Transportation Business and Management, 4, 44–52. https://doi.org/10.1016/j.rtbm.2012.06.015

Puls, R., & Lentz, C. (2018). Retail concessions at European airports: Commercial strategies to improve non-aeronautic revenue from leisure travellers. Journal of Air Transport Management, 71, 243–249. https://doi.org/10.1016/j.jairtraman.2018.04.010

Reece, D., & Robinson, T. (2018). Airport ownership and regulation. In IATA guidance booklet. IATA and Deloitte.

Remencova, T., & Sedlackova, A. N. (2021). The approach to evaluation of the economic and operational indicators of selected regional airports in the countries of Central Europe. Transportation Research Procedia, 59, 154–165. https://doi.org/10.1016/j.trpro.2021.11.107

Riga airport. (n.d.). Annual report. https://www.riga-airport.com/about-rix/annual-report/en

RIX. (2018). Gada Grāmata. https://www.riga-airport.com/uploads/Gadagr%C4%81matas/Rix%20gadagramata_2018_FINAL.pdf

Rotondo, F. (2019). An explorative analysis to identify airport business models. Research in Transportation Business and Management, 33, 100417. https://doi.org/10.1016/j.rtbm.2019.100417

Soylu, B., & Katip, H. (2019). A multiobjective hub-airport location problem for an airline network design. European Journal of Operational Research, 277(2), 412–425. https://doi.org/10.1016/j.ejor.2019.02.056

Suau-Sanchez, P., Voltes-Dorta, A., & Rodriguez-Deniz, H. (2015). Regulatory airport classification in the US: The role of international markets. Transport Policy, 37, 157–166. https://doi.org/10.1016/j.tranpol.2014.11.003

Sydow, J., Wirth, C., & Helfren, M. (2020). Strategy emergence in service delivery networks: Network-oriented human resource management practices at German airports. Human Resource Management Journal, 30(4), 566–585. https://doi.org/10.1111/1748-8583.12298

Takebayashi, M. (2018). Managing airport charges under the multiple hub network with high-speed rail: Considering capacity and gateway function. Transportation Research Part A: Policy and Practice, 112, 108–123.
https://doi.org/10.1016/j.tra.2018.01.011

Tallinn airport. (2018). Annual report 2018. https://www.tallinn-airport.ee/wordpress/wp-content/uploads/2019/06/Tallinna-Lennujaam-eng.pdf

Tallinn airport. (n.d.). Annual reports. https://www.tallinn-airport.ee/en/about-us/annual-reports/

Tveter, E. (2017). The effect of airports on regional development: Evidence from the construction of regional airports in Norway. Research in Transportation Economics, 63, 50–58. https://doi.org/10.1016/j.retrec.2017.07.001

Uzule, K. (2021). Factors affecting the revenue structure at Baltic airports [unpublished Master’s thesis, Transport and Telecommunication Institute]. Riga.

Vilniaus oro uostas. (2018). Traffic report 2018. https://www.ltou.lt/uploads/documents/files/corporate/aircraft-services/Statistics/84734affbe7b998b33b583cfc650fb7e.pdf

Vilnius airport. (2021). Flights schedule. https://www.vno.lt/en/before-the-flight/flights-information/flights-schedule?direction=arrival&destination=&date-from=2021-01-28&date-to=2021-02-27&page=14

VĮ Lietuvos oro uostai. (2020). Įmonės 2019 metų audituotos finansinės ataskaitos, parengtos pagal tarptautinius finansinės atskaitomybės standartus, priimtus taikyti Europos sąjungoje. https://www.ltou.lt/uploads/documents/files/apie-oro-uostus/administracine-informacija/finansines-ataskaitos/2019/LOU%20FS%202019%20LT.pdf

Wong, W.-H., Zhang, A., Cheung, T. K.-Y., & Chu, J. (2019). Examination of low-cost carriers’ development at secondary airports using a comprehensive world airport classification. Journal of Air Transport Management, 78, 96–105. https://doi.org/10.1016/j.jairtraman.2019.01.007

Zhang, A., Wan, Y., & Yang, H. (2019). Impacts of high-speed rail on airlines, airports and regional economies: A survey of recent research. Transport Policy, 81, A1–A19. https://doi.org/10.1016/j.tranpol.2019.06.010