Asia Pacific Airports Magazines, Issue 2, 2015

The official publication of ACI Asia-Pacific www.aci-asiapac.aero

Going places In the spotlight: Airlines & route development

Issue 2, 2015

Airports: Malaysia’s airport system

www.aci-apa.com

Conference report: Highlights from the Dead Sea Plus: Incheon’s new Terminal 2

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ASIA-PACIFIC AIRPORTS MAGAZINE

CONTENTS

Asia-Pacific Airports Issue 2, 2015

6 View from the top

Regional director, Patti Chau, reflects on a busy half-year for ACI Asia-Pacific that included the Regional Assembly, Conference & Exhibition in Jordan.

8 News Round up of regional news.

10 What a show!

Joe Bates looks back at some of the highlights of ACI Asia-Pacific’s 2015 Regional Assembly, Conference and Exhibition in Jordan.

14 ACI Asia-Pacific news Vivian Fung reports on the latest news, views and events from across the region.

16 Making the right headlines

Peta Tomlinson and Joe Bates find out more about how Malaysia Airports Holdings Berhad (MAHB) is faring after a difficult 16 months for the country’s airlines and travel industry.

24 Leap of faith

Zhang Xiuzhi, CEO of Chinese low-cost carrier, Spring Airlines, tells Graham Newton that thinking big comes easily.

26 Spotlight on India

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Nigel Mayes, ASM’s senior vice president consulting and product development, asks whether India can finally fulfil its potential?

www.aci-apa.com

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ASIA-PACIFIC AIRPORTS MAGAZINE

CONTENTS 28 Arabian flights

Graham Newton talks to Oman Air CEO, Paul Gregorowitsch, about the airline’s strategy and its role in the wider economy.

32 Fit for purpose Airspace in the Middle East must have the flexibility to deal with the region’s rapid aviation growth.

Asia-Pacific Airports (APA) www.aci-apa.com Editor Joe Bates joe@aci-apa.com Design, Layout & Production Mark Draper mark@aci-apa.com

APA Issue 2, 2015

Published by Aviation Media Ltd PO BOX 448, Feltham, TW13 9EA, UK Managing Director Jonathan Lee jonathan@aci-apa.com Advertising Manager Andrew Hazell andrewh@aci-apa.com

34 Design & build

Incheon International Airport.

37 World Business Partners All the latest news from the region’s WBPs.

38 Lights, camera, action!

New Zealand has much to offer beyond the movie industry spotlight.

Advertising Manager Kalpesh Vadher kalpesh@aci-apa.com Subscriptions subscriptions@ aviationmedia.aero Printed in the UK by Magazine Printing Co

Asia-Pacific Airports (APA) is published four times a year for the members of ACI Asia-Pacific. The opinions and views expressed in APA are those of the authors and do not necessarily reflect an ACI policy or position.

The content of this publication is copyright of Aviation Business Media and should not be copied or stored without the express permission of the publisher.

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VIEWPOINT

VIEW FROM THE TOP

Regional director, Patti Chau, reflects on a busy half-year for ACI Asia-Pacific that included the Regional Assembly, Conference & Exhibition in Jordan.

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fantastic Regional Assembly, Conference & Exhibition in Jordan and a host of opportunities to expand the organisation’s influence across the globe ensure that it has been a memorable half-year for ACI Asia-Pacific.

Thanks to the support of Airport International Group (AIG), our sponsors and members I am pleased to say that the 10th ACI Asia-Pacific Regional Assembly, Conference & Exhibition in Jordan was an outstanding success.

Over 350 airports, airlines, aviation authorities and business executives from 130 organisations across the world attended our very first Regional Assembly held in the Middle East.

The event was also extra special as it was our tenth Regional Assembly since the unification of ACI’s former Asia and Pacific regions, and we duly marked the occasion in style in a truly wonderful setting.

MILESTONE ANNIVERSARY

Many of us, myself included of course, witnessed the unification and can take great pride and satisfaction in how ACI’s newest region and the airport industry have grown over the past decade.

APA Issue 2, 2015

Indeed, Asia-Pacific is now the major growth engine in the global aviation market and our membership has grown significantly to almost 100 members.

To commemorate the occasion, a special photo exhibition was organised at this year’s conference to showcase some of the significant milestones and memories of the last ten years, including when the past presidents of ACI Asia and ACI Pacific regions officially inked the document in Hong Kong to unify the two regions.

You will be able to read more about the 10th anniversary of ACI Asia-Pacific in the next issue of our magazine, which will feature interviews with some of the founding members of the region.

NEW RESOLUTIONS

At the Assembly three key resolutions designed to support and further promote excellence in airport operations and management were passed.

These included support for the Airport Excellence (APEX) in Safety Programme; backing the Airport Carbon Accreditation programme; and recognising the need to promote ICAO’s Next Generation of Airport Professionals (NGAP) initiative.

ASIA-PACIFIC AIRPORTS MAGAZINE

SPREADING THE WORD

Continuing to grow the global reputation, recognition and influence of ACI Asia-Pacific throughout the industry and beyond is always at the top of our agenda, and with this in mind I recently participated in a ‘Going Green’ panel discussion at the ASEAN Aviation Summit in Langkawi, Malaysia.

I used the occasion to share information with delegates and fellow panelists about some of the pioneering environmental initiatives undertaken by the region’s airports.They, of course, include Airport Carbon Accreditation, which was launched in Asia-Pacific in 2011 and is now a worldwide programme, and the simple do-it-yourself tool for the estimation of Airport Carbon Emissions (ACERT).

Looking ahead, ACI Asia-Pacific will continue to work closely with ASEAN to explore more opportunities for co-operation.

Elsewhere on my travels I showcased the work of ACI at an international Operational Readiness and Airport Transfer (ORAT Conference) held in Muscat where I highlighted Asia-Pacific’s growth markets and how ACI is collaborating with other stakeholders to improve efficiency and ensure a better passenger experience at the world’s airports.

LISTENING AND LEARNING

We constantly strive to do better in everything we do and as such are always looking to make improvements.

The Regional Office is, of course, fully committed to engaging with its members, and successful member engagement requires an obligation to actively engage with, listen to and respond to our members.

It is a two-way dialogue seeking understanding and solutions to issues of mutual concern.

As part of this strategy I visited a number of airports in the Middle East region in June, aiming to strengthen our relationships and better understand the fast-growing members in that area.

On my whistle-stop tour I met with our airport members and regulators in Bahrain, Kuwait, Qatar, and United Arab Emirates, and the trip clearly demonstrated the importance of a two-way dialogue.

The very constructive meetings centred on the future development and opportunities for airports in the region and how ACI could work more closely with them to align and provide services to address their specific needs.

I promise you that ACI Asia-Pacific as the association representing Asia-Pacific airports will continue to reach out to our members and other industry stakeholders to establish relationships and influence and help shape aviation related policies.

FUTURE EVENTS

Finally, I would like to invite you to join us at three key events that will be held in Asia-Pacific region in the second half of the 2015.

In September together with ACI World and The Moodie Report we are jointly organising the Trinity Forum in Hong Kong (September 16-18), which will be hosted by Hong Kong International Airport.

The theme for this year’s instalment of the world’s leading airport commercial revenues conference is ‘Putting the Consumer at the Heart of the Trinity’.

It will be followed by the HR Best Practice Seminar in Tokyo (October 7-9) – hosted by Narita International Airport Corporation – and the Small and Emerging Airports Seminar in Macau (November 2527), hosted by Macau International Airport Company Limited.

I look forward to seeing you at one or APA all of these events! www.aci-apa.com

VIEWPOINT

We believe that the support of our members is crucial to the success of each programme, so it gives me great pleasure to see that a number of our airports are already participating in them.

I sincerely hope they will be joined by more of you in the future as it would be great to see them being widely adopted throughout the Asia-Pacific region.

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NEWS

TERMINAL VELOCITY The technical advisor to operator GMR-Megawide has called in Mott MacDonald to monitor the construction of Mactan Cebu International Airport’s new international terminal and upgrade of its existing Terminal 1.

Under the terms of its 25-year concession, the GMR-Megawide consortium responsible for operating Mactan Cebu is required to build a new 8mppa capacity terminal by April 2017 – 36 months after winning the tender.

Construction of the new terminal will allow Terminal 1 to be expanded, modernised and converted into a completely domestic flights-only facility capable of handling up to 4.5mppa.

Ian Guy, Mott MacDonald’s project director, said: “The Philippine government has embarked on an ambitious new PPP programme for infrastructure deals across numerous sectors. Mactan Cebu serves as the country’s first successful airport PPP in this programme.”

ALL CHANGE IN QUEENSTOWN Queenstown Airport has opened its new-look international terminal – almost 20 years to the day since international flights were launched from the New Zealand gateway.

The 4,100sqm expansion of the southern end of the terminal building has doubled the size of the airport’s international operations and features new and improved facilities, products and services.

Key elements include two new gate lounges and a new state-ofthe-art customs processing area, expanded airside retail outlets, a third baggage carousel and back-of-house handling areas.

QAC chief executive, Scott Paterson, enthuses: “Back when our first international flight arrived on July 1, 1995, and for several years after, passengers were processed by customs in a makeshift space outside the terminal, so we’ve come a long way in 20 years.

“Being able to offer a top-class facility in a world-renowned destination has strengthened our position as a key regional and international gateway for New Zealand.”

GIMPO JOINS ASQ HALL OF FAME

HERE TO STAY Hong Kong Air Cargo Terminals Limited (Hactl) – Hong Kong’s largest cargo handling agent – has signed a new 10-year extension of its handling franchise at the airport.

The signing of the new agreement, which commences in July 2018, is seen as clear confirmation of Hactl’s long-term commitment to the airport, and its role as the original and still largest cargo operator.

Chief executive, Mark Whitehead, says: “I don’t believe we can send a clearer signal about our total commitment both to the airport and to the future of our business. Hactl is here to stay.”

APA Issue 4, 2014

Seoul’s Gimpo International Airport has been inducted with distinction into ACI’s Director General’s Roll of Excellence. It has topped the 15-25 million passengers category in the Airport Service Quality (ASQ) passenger satisfaction survey for five consecutive years.

The achievement will be recognised at a special ceremony in Panama City during the ACI World/Latin America-Caribbean Assembly, Conference and Exhibition in September.

Chhatrapati Shivaji International Airport, Delhi Indira Gandhi International Airport and Indianapolis International Airport will also be honoured at the event after placing in the top five in their respective categories for five consecutive years.

Korea Airports Corporation (KAC) president and CEO, Dr Seokki Kim, believes that initiatives such as its ‘culture-port project’ and making the terminal more accessible for disabled passengers by making it a ‘barrier-free airport’ have helped Gimpo take “a major leap forward in terms of delivering quality customer service”.

ASIA-PACIFIC AIRPORTS MAGAZINE

BIGGER BUT SMALLER Dubai World Central–Al Maktoum International Airport (DWC) won’t be one giant hub with an ultimate capacity of an astonishing 240 million passengers per annum but 12 medium size airports each capable of accommodating 20mppa, according to Dubai Airports CEO, Paul Griffiths.

He claims that this is the case as each of the 12 nodes being developed on the vast 140-square kilometre airport site will act as self-contained, independent facilities effectively creating 12 different airports.

Speaking at the Air Transport IT Summit in Brussels in early June, Griffiths said the 12-airport concept would make DWC one of the most “customer centric” airports on the planet with all facilities within a 400-metre walking distance.

“In my view we are heading in the wrong direction by building ever bigger airports because bigger is not necessarily better. It inevitably means longer walking distances, less intimate experiences and greater difficulties in making connections. We will be creating something that is manageable, navigable and easy to use.”

Read more about his vision for DWC and how IT will transform airport design in the next issue of AsiaPacific Airports magazine.

Vietnam is to build a new $16 billion airport on a colossal 50 square kilometre site on the outskirts of Ho Chi Minh City.

Vietnam’s airline market is growing at the third-fastest pace in the Asia-Pacific region and it believes that rapidly rising demand means that the new airport has the potential to one day rival hubs like Bangkok Suvarnabhumi and Singapore Changi.

Vietnam’s parliament approved the ambitious new project in June paving the way for construction of Long Thanh International Airport to start in 2018.

“When looking at the population and economic growth, Vietnam has a lot of potential,” says Lai Xuan Thanh, director general of the Civil Aviation Administration of Vietnam.

“Infrastructure, or lack of it, is one of the reasons Vietnam has yet to exploit that potential in the air transport market. Long Thanh is necessary and strategic.”

France’s Aéroports de Paris (ADP) group is thought to interested in helping develop Long Thanh but first wants to become a strategic investor in state-run airport operator, Airports Corporation of Vietnam.

If all goes to plan, Long Thanh is to be built in three phases over three decades, to reach a targeted annual capacity of 100mppa and five billion tonnes of cargo per annum.

BRISBANE AUTO MALL Brisbane Airport is seeking Expressions of Interest for a joint venture partner to help realise its new vision for Airport Central – an all-encompassing automotive precinct with dealerships, servicing, offices and associated retail all in the one convenient location.

Brisbane Airport Corporation (BAC) believes the new Auto Mall, which would be the first for an

Australian airport, would make the perfect addition for a 50-hectare site that has been identified for commercial development.

Explaining the airport’s vision, BAC CEO and managing director, Julieanne Alroe, said: “While aircraft will always be our first love, adding a premier automotive precinct to the growing airport community will be a win-win for the city and State.” www.aci-apa.com

NEWS

GREEN LIGHT FOR NEW VIETNAM GATEWAY

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EVENTS: REGIONAL ASSEMBLY

What a show!

Joe Bates looks back at some of the highlights of ACI Asia-Pacific’s 2015 Regional Assembly, Conference and Exhibition in Jordan.

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elieve in Jordan is the name of Queen Alia International Airport’s sleek new promotional video, and it is a sentiment now shared by all 350 delegates who attended a truly memorable ACI Asia-Pacific Regional Assembly, Conference and Exhibition at the Dead Sea. In truth, the conference was special before it began because it was the first time the Middle East had been chosen to hold the region’s annual gathering and the event marked the 10th anniversary of the unification of ACI’s former Pacific and Asia regions.

Throw in the extraordinary backdrop of the Dead Sea, the incredible hospitality of the Jordanian people, the Airport Service Quality (ASQ) Awards Ceremony and two days of lively debate and you had a winning formula that will be hard to beat in the future.

The theme of this year’s event was ‘Sustaining Aviation and Tourism Growth under Unprecedented Challenges’, something ACI Asia-Pacific president, Dennis Chant, reflected upon in his opening remarks.

“Tourism and aviation development go hand in hand, one impacting the other.

However, tourism can be very vulnerable and easily affected by the countries’ policies and political stability,” he said.

APA Issue 2, 2015

“Airports in our region understand this intricate relationship between the two industries and the importance in supporting and facilitating international tourism within their own countries.”

He also had one or two words to say about the progress and development of the ACI Asia-Pacific region since its historic unification a decade ago.

“We’ve come a long way in ten years,” said Chant. “Asia-Pacific has become the major growth engine in the global aviation market and our membership has increased significantly, to almost 100 members operating close to 580 airports in 47 countries.

“With the support of the members and co-ordination by the Regional Office, we have achieved many milestones in the past 10 years. Indeed, as the only association in the region to represent airports’ interests, ACI Asia-Pacific is dedicated in ensuring that ACI’s mission to advance airports’ collective interests and to promote professional excellence is achieved.”

During her keynote address, Jordan’s Minister of Transport, Dr Lina Shbeeb, told delegates about the success of the country’s Open Skies policy and stated how much the government valued aviation and Queen Alia International Airport.

Arguably the highlight of the first day was the State of the Industry panel discussion about the Challenges and Opportunities in the Middle East involving Chant; Airport International Group CEO, Kjeld Binger; IATA’s area manager for

ASIA-PACIFIC AIRPORTS MAGAZINE

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EVENTS: REGIONAL ASSEMBLY

Levant and the near east, Murad Al Khatib; and His Excellency, Nayef Al-Fayez, Jordan’s Minister of Tourism and Antiquities.

Talking about the transformation of Queen Alia following the opening of its new terminal, Kjeld Binger said: “The new infrastructure was a huge step, of course.

The new terminal is fabulous and has an amazing ambience, but it is just the start.

You have to work with it and all the other stakeholders at the airport, hand-in-hand, to really make a difference and improve customer service.”

As reported in the last issue of APA, Kjeld repeated that one of the most popular customer service initiatives they have introduced at Queen Alia to date was to simply to get the airport’s security

guards to replace their army uniforms with “more welcoming” blazers and trousers.

During her annual report at the ACI-Asia Pacific Regional Assembly, regional director, Patti Chau, noted that a number of successes over the past 12 months included establishing a Regional Economics Committee, building and enhancing ACI’s relationship and influence with ICAO and increased co-operation with other industry organisations such as the Association of Asia Pacific Airlines (AAPA) and IATA. She said the number of airports undergoing Airport Excellence (APEX) in Safety reviews was on the rise as is the amount of Asia-Pacific gateways to be certified under ACI’s Airport Carbon Accreditation programme. www.aci-apa.com

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EVENTS: REGIONAL ASSEMBLY A fine first day ended with the Gala Dinner and ASQ Awards Ceremony at the Fishing club at the Marriott Hotel, where once again the region’s airports picked up the majority of the awards.

Not surprisingly the loudest cheers of the night were saved for home airport, Queen Alia, which won both the Best in the Middle East and the Best Improvement: Middle East categories.

Indeed, Queen Alia celebrated in style with over a dozen members of staff on stage posing for pictures, and they weren’t alone as Hyderabad, Taipei Taoyuan and Incheon all performed similar celebrations and it was smiles all round for over 25 airports receiving awards on the night.

Delegates actually had to wait until the very last session for the traditional conference highlight, the Leader’s Summit, which this year was about visions for the future and featured among others Sydney Airport’s chairman and former ACI AsiaPacific president, Max Moore-Wilton, and ACI World chairman and president and CEO of Sarasota-Manatee Airport Authority, Rick Piccolo.

Moore-Wilton said he was optimistic about a bright future of the aviation industry but warned that commercial success – “making money, developing their product and finding their niche in the APA Issue 2, 2015

market” was vital for both airlines and airports if they are to survive and prosper in the long-term.

“At the end of the day I don’t think governments, populations and the travelling public will be prepared to subsidise carriers that cannot compete, and I take a very similar view with airports. If you are in the commercial business you have to find ways of competing,” he said.

“If smaller airports with the support of communities see becoming property developers as an opportunity to boost their commercial income then that is fantastic, because these are the communities that will prosper in the future.

“Those communities, airlines and airports that want to look backwards and talk about the good old days, if they ever existed, are the ones that are going to have a problem.”

Other sessions during the conference covered a wide variety of topics ranging from the next generation hub; airport collaborative decision-making (A-CDM); maintaining safety and operational efficiency and addressing emerging threats to maximising airport revenue.

Next year’s conference will be hosted by Queensland Airport Limited and held at the Gold Coast, Australia, on April 18-20, 2016.

Dennis Chant and his team know that they APA have a hard act to follow!

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ACI ASIA-PACIFC NEWS

Regional update Vivian Fung reports on the latest news, views and events from across the region.

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ingapore Changi’s Jeffrey Loke and Delhi-Indira Gandhi International Airport’s Madhukar Dodrajka were elected chair and vice chair respectively of the new Regional Economics Committee at its inaugural meeting during the Regional Assembly, Conference & Exhibition in Jordan.

A total of 19 people attended the meeting, including airport members, observers, guest speakers from industry organisations and ACI staff.

The newly formed committee aims to provide regional support to members on airport economic matters and serve as a forum for members to share best practices and discuss challenges and opportunities on topics such as airport charges, ownership models, financing, revenue generation, performance management and air cargo.

It is currently working on the development of an annual schedule that it hopes will promote dialogue and enhances understanding of airport economic challenges. The preliminary work plan is expected to cover: • Business Intelligence • E conomic value of airports • A irport charges • E nhancing commercial revenues A guest speaker from the Asia Pacific Travel Retail APA Issue 2, 2015

Association made a presentation about its Responsible Retail Training Programme at the inaugural meeting at the Dead Sea in Jordan.

Such contributions are common at ACI Asia-Pacific events as the Regional Office works closely with other industry associations to promote professional excellence in airport management and operations.

The next committee meeting will be held in Q4 2015 in New Delhi, India. For further information about the Regional Economics Committee, please contact our manager for economics and statistics, Suzanne Tong, at Suzanne@aci-asiapac.aero.

CANSO APAC CONFERENCE 2015

The Regional Office spoke about the role airports could play in support of Open Skies at the CANSO APAC Conference in Fukuoka, Japan, in May. Over 140 air traffic management leaders attended the event, which had the theme Towards Seamless Sky in the Asia Pacific – Building Capabilities, Partnering for Success.

In our presentation we stressed the importance of co-ordinating air traffic forecasts between ACI, IATA, CANSO, ICAO and other industry stakeholders.

Furthermore, we emphasised the need to have airport

collaborative decision-making (A-CDM) connected to CDM in order to optimise the overall performance of the air transport network.

STAFF MOVEMENT

We are sad to say farewell and thank you to Incheon Airport’s HJ Jung who finished his secondment with the Regional Office earlier this year. HJ joined ACI Asia-Pacific in October 2013 and during his 18-month secondment helped on various projects including the planning and successful execution of the World Annual General Assembly in Seoul in 2014.

He has been replaced by Incheon Airport colleague, Soonil Hwang, who has joined the Regional Office as an executive assistant. Hwang will commence his job rotation with the Membership Services and Events Division.

ASIA-PACIFIC AIRPORTS MAGAZINE

December 8-10 Airport Exchange Istanbul, Turkey

2015

September 16-18 The Trinity Forum Hong Kong, China

2015

October 7-9 ACI Asia-Pacific HR Best Practice Seminar Tokyo, Japan

2015

November 25-27 ACI Asia-Pacific Small and Emerging Airports Seminar Macau, China

ACI ASIA-PACIFIC BOARD

PRESIDENT

Dennis Chant* (Queensland Airports Limited, Australia)

FIRST VICE PRESIDENT

Seow Hiang Lee* (Changi Airport Group Pte Ltd, Singapore)

SECOND VICE PRESIDENTS Kerrie Mather* (Sydney Airport Corporation Limited, Australia) PS Nair* (Delhi International Airport Limited, India)

SECRETARY-TREASURER Emmanuel Menanteau* (Cambodia Airports, Cambodia)

IMMEDIATE PAST PRESIDENT

Tan Sri Bashir Ahmad Abdul Majid** (Malaysia Airports Holdings Berhad, Malaysia)

REGIONAL BOARD DIRECTORS

Sulaiman Zainul Abidin (Pioneer Aerodrome Service Co Ltd, Myanmar)

David Fei (Taoyuan International Airport Corporation, Taiwan)

Mark Young (Adelaide Airport Limited, Australia)

Kenichi Fukaya* (Narita International Airport Corporation, Japan)

Waleed Youssef (Tibah Airports Operation Co Ltd, Saudi Arabia

Seok Ki Kim (Korean Airports Corporation, Korea)

REGIONAL BOARD DIRECTOR (WBP)

Derun Li (Shanghai Airport Authority, China)

Andrew Ford (DFS Group Limited, Hong Kong)

Youssef Al-Abdan (General Authority Of Civil Aviation, Saudi Arabia)

Xue Song Liu** (Beijing Capital International Airport Co Ltd, China)

SPECIAL ADVISORS

HE Ali Salim Al Midfa (Sharjah Airport Authority, UAE)

Pedro Roy Martinez (AB Won Pat International Airport Authority, Guam)

Keiichi Ando (New Kansai International Airport Co Ltd, Japan)

ACK Nair (Cochin International Airport Limited, India)

Kjeld Binger* (Airport International Group, Jordan)

Sasisubha Sukontasap (Airports of Thailand, Thailand)

Datuk Badlisham Bin Ghazali (Malaysia Airports Holdings Berhad, Malaysia) Fred Lam (Airport Authority Hong Kong, Hong Kong) Wan-su Park (Incheon International Airport Corporation, Korea)

* WGB member **Regional Advisor on WGB

The ACI Asia-Pacific region represents 99 members operating 580 airports in 47 countries and territories. www.aci-apa.com

ACI ASIA-PACIFC NEWS

EVENTS 2015

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MAHB

Making the right headlines Peta Tomlinson and Joe Bates find out more about how Malaysia Airports Holdings Berhad (MAHB) is faring after a difficult 16 months for the country’s airlines and travel industry.

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f managing director, Datuk Badlisham Ghazali, has any doubts about the future success and prosperity of Malaysia’s airport system he is doing a good job of hiding it, for the new man in the hot-seat positively exudes quiet confidence.

This may come as a surprise to some as the impact of last year’s tragic loss of Malaysia Airlines flights MH370 and MH17 continues to be felt by the country’s national flag carrier, and Malaysia Airports Holdings Berhad’s (MAHB) biggest customer, today.

Indeed, in early June the now 100% government-owned and “technically bankrupt” airline, according to its CEO,

APA Issue 2, 2015

announced plans to restrucure and rebrand itself – axing 6,000 jobs in the process.

The airline is most definitely not in a good place right now, but Datuk Badlisham believes that it has turned the corner, and feels that this will be reflected by slowly rising traffic figures in the months ahead.

In actual fact MAHB’s new boss has been talking about “recovery” since May when the company’s first annual report under his reign revealed that a record 83.4 millon passengers (+4.7%) passed through Malaysia’s airports in 2014.

Between them MAHB’s 39 airports also handled more aircraft movements and cargo last year than ever before and saw the opening of klia2, the world’s largest

ASIA-PACIFIC AIRPORTS MAGAZINE

LOW-COST CARRIERS

Datuk Badlisham is clearly banking on the success of klia2, which with a price tag of $1.3 billion, respresents a major investment for MAHB. Built in anticipation of the evolving airlines’ business model, higher passenger expectation and traffic growth, it is expected to serve the demands of not only the national, but also the regional aviation industry well.

Arguably its stylish design, capacity – it is equipped to handle up to 45mppa – and facilities that include 68 contact stands, buggy rides to departure gates, a fully automated baggage handlling system and close to 100 shops and F&B outlets have taken low-cost carrier terminals to a new level.

Datuk Badlisham notes that its opening means that LCC passengers no longer have to walk on the tarmac to get to an aircraft at KLIA, an experience he admits could be unpleasant due to Kuala Lumpur’s tropical climate characterised by sticky heat in the summer and heavy downpours during the rainy season.

And just a year on from its opening the 260,000sqm terminal is already being enhanced with the installation of 19 additional ‘walkalators’, which according to Datuk Badlisham will further improve the passenger experience at klia2.

www.aci-apa.com

MAHB

terminal dedicated to low-cost carriers in Kuala Lumpur.

He calls the performance “commendable” in the circumstances, believing that the rising traffic figures reflected the resilience of MAHB’s business, “despite the unprecedented aviation tragedies that affected traveller sentiment”.

And Datuk Badlisham, who succeded the long-serving Tan Sri Bashir in the top job a year ago, states that robust GDP growth in ASEAN member countries and the recent drop in fuel prices could prove the catalyst for further growth.

“The recent drop in fuel price may help stimulate air travel demand in 2015 as profitability for airlines will increase and in turn, encourage increased seat offerings and lower fares,” he says.

The former CEO of Malaysia’s Multimedia Development Corporation does, however, admit to some caution, predicting a modest 3% growth in passenger traffic across MAHB’s airports in 2015, although the Malaysia Year of Festivals tourism campaign, and the return of British Airways to Malaysia, bring scope for further optimism.

“The other challenge will be to increase our non-commercial revenue so that there is less dependency on carrier traffic,” he notes.

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MAHB

He is also quick to point out that the popularity of the range and variey of retail outlets in klia2, not something normally associated with a low-cost terminal, has led to a boom in concession sales. Indeed, its average passengers spend is 65% of that in the main terminal building.

AIRPORT CITY

Both klia2, and a second major investment – the completion of the 100% ownership of Istanbul–Sabiha Göcken International Airport operator, ISG, in April 2015 – are in line with the business strategy and direction formulated five years ago, says Datuk Badlisham.

“They will serve as the seed for our future growth,” he says, noting that becoming a major global airport operator and developing new sources of non-aeronautical related revenue, which includes an airport city within the vicinity of Kuala Lumpur International Airport, remain high on the agenda.

“We anticipate that these investments will ultimately provide us with the financial means to achieve our vision of becoming a global airport leader and creator of airport cities,” he says.

MAHB calls its Kuala Lumpur airport city project, KLIA Aeropolis, and it celebrated a major milestone on May 30 this year with the opening of Mitsui Outlet Park KLIA under its joint venture company MFMA Sdn. Bhd.

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MFMA is a collaboration between MAHB and Mitsui Fudosan, a Japanese corporation with internationally recognised expertise in development and retail projects.

“We also envisage KLIA being positioned as South East Asia’s number one e-commerce distribution hub,” says Datuk Badlisham.

“In line with this vision, there are plans to develop a cargo and logistics park to support the region’s booming e-commerce market, which is expected to grow five times, from $7 billion to over $35 billion per annum by 2018.

“E-commerce hubs have yet to be established in South East Asia, but this is all about to change due the competitive advantages of KLIA, which include the airport’s favourable location, good air and ground networks and labour talents,” he enthuses.

According to Datuk Badlisham , the vast 100-acre land bank at KLIA’s disposal will enable MAHB to further diversify its revenue stream, effectively shoring up its long-term sustainability.

“We have a huge advantage in the available land bank that we own around KLIA and aim to build a veritable citywithin-a-city here,” he says. “It will be a city where our commercial partners and other business entities can tap into the connectivity advantages offered by the airport and the nearly 50 million passengers that pass through it every year.”

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CUSTOMER SERVICE

MAHB’s other international gateways in Malaysia are Kota Kinabalu, Kuching, Langkawi and Penang.

GLOBAL AIRPORT OPERATOR

In addition to its Malaysian airports, MAHB has an 11% stake in Hyderabad’s Rajiv Gandhi International Airport in India and since January this year has 100% owned ISG, which operates Istanbul’s Sabiha Göcken International Airport in Turkey.

“The acquisition of the remaining stake at ISG and LGM (the firm that operates services within the airport) will strengthen MAHB’s foothold and influence as an airport manager and airport operator in Turkey, and also reinforce our strategic position as a world-class airport manager and operator,” says Datuk Badlisham.

“We will continue to explore management and investment opportunities at airports in different parts of the world where we can add value in tandem with our government’s aspiration to export Malaysian expertise.

“I’m also working with my team to chart the next phase of growth in our six-year business plan, to develop MAHB as a more agile, dynamic and competitive global business entity.”

He adds: “When it comes to aeronautical activity, we continuously strive to enhance services and provide timely and efficient infrastructure and capacity. We will also

MAHB’s ambitious mission statement to “create joyful experiences by connecting people and businesses” is firmly in Datuk Badlisham’s mind as he strives to work closely with stakeholders to achieve the company’s goals, one of which is to provide top quality customer service at all of its airports.

“With the support of our external partners (airlines, retailers, government agencies, media, and public) and hand-in-hand with our workforce, we aim to provide and facilitate delightful and meaningful experiences for all our stakeholders,” he tells APA. “We are all in it together, so it is critical that all of us work closely together to provide the right level of services, facilities and capacity to cater to the volatile, yet dynamic aviation industry.

“This means holding regular meetings with the airlines, government agencies operating at the airports and other stakeholders to get their feedback and suggestions to ensure that all of us better understand the needs and requirements of our passengers.”

It is a good plan and it is clearly working as Datuk Badlisham recently picked up an Airport Service Quality (ASQ) Award for Langkawi International Airport, which was named Asia-Pacific’s Best Airport handling less than 2mppa for the second successive year in ACI’s annual customer satisfaction survey.

There is no doubt that MAHB is in safe hands with the vastly commercially experienced Datuk Badlisham, who has a technology background and can count Hewlett Packard among his former employers in the private sector. With a young and diverse management team, around a third of which are women, and Tan Sri Bashir still around for now in an advisory capacity, there is no lack of talent APA at the top at Malaysia Airports. www.aci-apa.com

MAHB

emphasise on non-aeronautical development, and value-adding strategic partnerships, locally and abroad.”

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ASIA-PACIFIC AIRPORTS MAGAZINE

AIRLINES & ROUTE DEVELOPMENT

Leap of faith Zhang Xiuzhi, CEO of Chinese low-cost carrier, Spring Airlines, tells Graham Newton that thinking big comes easily.

S

pring Airlines was founded in 2004 as part of a partial liberalisation of the civil aviation sector in China and commenced flights in July 2005.

By 2008, many of the new airlines that emerged during this time had either gone bankrupt or were taken over by the larger state-owned airlines.

Spring’s ability to survive was in part due to its low-cost carrier (LCC) business model and the fact that its major bases are at Shanghai’s Pudong and Hongqaio airports.

As China’s financial capital and home to a large population with the highest disposable income in China, there is a consistent volume of both inbound and outbound business and leisure traffic at Shanghai.

The management ability of its co-founder, Zhang Xiuzhi, was also crucial. Zhang is a firm believer that the LCC model can thrive in China despite it being a highly regulated market.

When Spring entered the market, over 80% of the Chinese population had never flown, meaning that the LCC business model made good sense for a market flooded with pricesensitive, first-time flyers.

And as Spring developed, so too did its range of travel products, enabling the airline to cater to an increasingly sophisticated and price-conscious business segment.

Indeed, the strategy has been so successful that in 2013, China’s aviation administrators acknowledged the role that LCCs play in a sustaining a healthy aviation sector and have now given approval to a number of new LCCs – many of which are full service carriers’ regional subsidiaries that are transitioning to LCCs. Hainan Group’s West Air and HK Express have already transitioned to LCCs, while a number of other airlines are in the process or APA Issue 2, 2015

contemplating such a move, including Capital, Chengdu and Chongqing airlines.

Zhou Laizhen, CAAC’s deputy director, spoke about the growing importance of the LCC sector at the 2nd ICAO-CAAC LCC summit, saying that they play an important part in the strategic plan for the industry’s growth and are critical to creating a more balanced and fiscally-sound aviation sector.

He also noted that the business models of both LCCs and full service carriers will continue to evolve and borrow from each other.

PERFORMANCE BY NUMBERS

Since its first flight in July 2005, Spring has grown steadily, assembling a fleet of 46 A320 aircraft and carrying some 13 million passengers in 2014.

“Significantly, over the last nine years we have maintained an average load factor of 95% and aircraft utilisation of over 11 hours,” says Zhang.

“This translates into 45 more passengers per flight than the Chinese industry average and 20% lower ton-kilometre fuel consumption.

Our goal is straightforward; remain profitable and ensure that our profit per aircraft remains among the industry’s highest.”

Certainly, there’s plenty of room to grow.

The LCC market has captured around a third of traffic on average worldwide. In some South East Asian nations that figure is well in excess of 50%. But in China, the world’s second largest aviation market, LCC market share barely scrapes 5%.

“It is fair to say that a LCC revolution is underway and its impact will be profound,” says Zhang. “This revolution will mean greater operational and management efficiencies and improved competitiveness. It is an exciting time to be in the industry.”

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LESSONS LEARNED

While the Chinese market may seem unique to many, Zhang informs that there is plenty of lessons to be learned from around the world.

“When you look back to the classic LCC model that emerged in the 1970s with its focus on a point-to-point, single aircraft type, high load factors and strict cost control, it is now considered LCC 1.0,” Zhang suggests.

“What Ryanair did in Europe – and the advent of online direct sales, the focus on ancillary revenue – was definitely 2.0. There have been many new versions since then, and we have taken lessons from them all.

“Operationally, we have stayed with the traditional LCC model of simple, safe and cost effective management. However, we are also focused on leveraging new technologies to improve our online sales channels and increasing ancillary revenues.

“Regardless of the business model you employ, you need to adapt to changing market expectations,” she continues. “We are always prepared to learn from the industry leaders and pioneers but have to be flexible in the way we

adapt to our unique market conditions and play to our strengths to ensure we, too, remain an industry leader.”

NETWORK

One of those strengths is the point-to-point network and Zhang confirms that remains a priority. Even within the flying range of the A320s, there are rich pickings. Spring operates over 80 domestic, regional and international routes covering the Greater China, North Asia and South East Asian regions.

From its bases in Shanghai, the airline can operate the A320 to over 266 cities in more than 26 countries, a network serving 3.7 billion people.

“North Asia is an important market for us,” says Zhang. “Our recent expansion in Japan and Korea means we already have aircraft overnighting in Osaka and Jeju Island.

“Stable Sino-Japanese relations and a Sino-Korean Free Trade Zone will mean that we will seek to open new routes and add density on existing routes in the region. At the same time we will look at more tourist routes in South East Asia.”

Watch this space for further developments. APA www.aci-apa.com

AIRLINES & ROUTE DEVELOPMENT

ASIA-PACIFIC AIRPORTS MAGAZINE

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ASIA-PACIFIC AIRPORTS MAGAZINE

AIRLINES & ROUTE DEVELOPMENT

Spotlight on India

Nigel Mayes, ASM’s senior vice president consulting and product development, asks whether India can finally fulfil its potential?

T

here is renewed optimism for the recovery of the Indian economy, the largest democracy on the planet. But is there the same optimism for the Indian aviation industry?

The only constant in the Indian aviation industry is “change”, a function of the changing fortunes of its domestic airlines and the environment in which these carriers are operating.

Spicejet is being rescued from the brink of bankruptcy while Indigo goes from strength to strength. Air India and Jet Airways have failed to develop their networks substantially over the last five years, but Jet Airways is in now the safe hands of Etihad and Air India has successfully joined Star Alliance and is benefiting from the introduction of the Boeing 787.

Meanwhile, new carriers, Air Asia India, Vistara and Air Costa, signal a new breed of airline in the India domestic market.

CAPACITY GROWTH

The election of Prime Minster, Narendra Modi, in May 2014 brought optimism for a change in fortunes of the Indian economy, but the recovery has been sluggish and his party has recently lost the Delhi State elections.

Despite the faltering economy in 2014 with GDP static at around 5.8%, most economists are predicting a more promising 2015.

APA Issue 2, 2015

The opportunity is enormous. With a population of 1.2 billion, India is the second most populous country in the world, but is the eighth largest aviation market by number of seats. A recent report by the Federation of Indian Chambers of Commerce (FICCI) and KPMG estimated that 99.5% the population has not flown, but the growing middle class has the potential to change this percentage dramatically.

Airline seat capacity growth for 2015 looks set to be around 5.7%, taking a representative week in June, this is above a CAGR of 3.3% for the previous four years. There is one carrier that has driven the majority of the seat growth in India and that is Indigo, which has generated five times more weekly seats in the past four years compared with the next largest carrier Jet Airways.

Indigo has focused its network development on domestic city pairs, with 105% growth in weekly seats in 2015 versus 2011, and has over one-third of the domestic market in India. The carrier has also been cautiously developing its international network over the last four years, with services to Nepal, Oman, Singapore, Thailand and the UAE. Excluding the domestic market, India is dominated by capacity into the Middle East and in particular the UAE, which now accounts for 30% of all international seats.

The next four largest markets in terms of

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AIRLINE FORTUNES

Indigo has become the market leader in India and with a fleet of 66 aircraft and an order book of 180 A320s, its position will be hard to dislodge. There is speculation that its success has caught the eye of Qatar Airways, so the carrier may be brought into the oneworld alliance, unless another group snaps it up.

The fortunes of the two full service network carriers, Jet Airways and Air India, appear to be turning around, perhaps more quickly at the later. Jet Airways, benefitting from investment from Etihad (24%) appears to have safeguarded its future.

The carrier has seen its LCC brand, Jetlite, brought into the main business. Its long-haul fleet has been reduced and an increased focus being placed on serving the Etihad hub at Abu Dhabi.

Meanwhile, Air India’s decision to join Star Alliance will bring revenue benefits and improved operational standards to the carrier. It has recently been mandated to reduce its costs by 10% for 2015/6, a task that should be achievable given the reduction in fuel price and the introduction of B787s, replacing the B747 and B777 fleet.

The second and third largest LCC carriers in India, GoAir and SpiceJet, appear to be having mixed fortunes with GoAir, a privately run airline, operating 20 A320s steadily developing its network from its main bases in Mumbai and Delhi. It is now able to operate international services.

SpiceJet on the other hand has debts of INR10 billion and as a consequence the founder, Ajay Singh, has taken on the ownership through additional investors.

Spicejet operates 18 B737s and 15 Q400s, and, like Indigo, over 95% of its network is domestic flying, with a few international services to, Afghanistan, Maldives, Nepal, Oman, Sri Lanka, Thailand, and the UAE Time will tell if the investment secured is enough to save the brand. Given the carrier

leases its aircraft, there are few assets to be salvaged if the new investment doesn’t succeed.

In the last 18 months, India has seen three new carriers enter the market, each with a slightly different business plan. Air Asia India – 49% owned by Air Asia with the rest owned by the Tata Group – operates three A320s from a base in Bengaluru. The carrier will be adopting the Air Asia strategy of low cost services focusing on secondary cities.

Air Costa, based at Vijawada, operates four Embraer 190s and 195s and has a further 50 on order. The regional low-cost carrier is targeting the slightly thinner routes between tier II and tier III cities, where a premium can be achieved.

The last new entrant is Vistara, 49% owned by Singapore Airlines. Based in Delhi, the carrier operstes five A320s and has a lease signed for another 20, with the first route being Delhi to Mumbai.

Vistara, like Air Asia India, has the backing of the Tata Group and is a full service carrier, bringing a Premium Economy product to India. The business plan is similar to JetBlue or Virgin Americas in the US. Certainly, Singapore Airlines’ involvement brings quality, but is the market mature enough for this level of market segmentation at this point in time?

In addition to the above new carriers, there is a further queue of new entrants, which are currently at the licencing stage.

These include Air One, Air Pegasus and ABC Airways.

Despite the huge potential in the Indian market, these new carriers will be entering a domestic market that suffers from low yield and high taxation on fuel – up to 60% higher than other countries. These are not the foundations for success.

Not all the carriers will survive and no doubt there’ll be some consolidation, similar to Air Sahara and Indian Airlines being absorbed into Air India.

It will be interesting to see which carriers – new or old – will help India’s aviation APA industry to fulfil its potential. www.aci-apa.com

AIRLINES & ROUTE DEVELOPMENT

seats are Singapore, Saudi Arabia, Thailand and the UK.

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AIRLINES & ROUTE DEVELOPMENT

Arabian flights Graham Newton talks to Oman Air CEO, Paul Gregorowitsch, about the airline’s strategy and its role in the wider economy.

Tell us about your strategy for the airline, including the expansion and the efficiency programme?

Oman Air is guided by a development plan that was endorsed by the board of directors in 2013. This sees our company invest significantly in new narrowbody and widebody aircraft, new destinations, technology and staff.

In line with the plan, the size of our fleet is expected to increase to 50 aircraft by 2018, with a further increase to 70 aircraft being achieved by 2020.

Late in 2014, the first of the Airbus A330s and B737s we have on order were delivered.

We also opened four new destinations, to Duqm, Sohar, Manila and Jakarta last year, and will be adding Goa, Singapore and Dhaka this year. If there are further additions to our network in 2015, we will announce them closer to the time of their launch. In addition, we have increased frequencies on a number of our established routes.

The new aircraft and destinations have helped us to increase the range of choices we offer and to boost the level of services offered to our valued customers.

Building on a range of recent innovations and services, our customer experience has undergone further improvements. On the ground, our first class and business class lounges are currently being refreshed, so that they will soon offer even greater comfort and convenience. In addition, we have unveiled new premium class security clearance at Muscat to complement our premium check-in facilities.

In parallel with this ambitious expansion programme, we have held fast to two APA Issue 2, 2015

fundamental aims: to ensure that every Oman Air customer experiences the best possible products and services; and to pursue our unwavering commitment to achieving profitability.

How will you position the airline in the market given such powerful competition in the Gulf?

Oman Air does not define itself against competitors – other carriers in the region have very different business models.

Instead of being a generic ‘Gulf carrier’, Oman Air offers a unique expression of Omani hospitality, culture and identity.

We also focus on every aspect of the passenger experience. We offer competitive pricing via our website, call centre and travel agent partners. You can now check in online up to 36 hours before departure.

Our lounges at Muscat, Salalah and Bangkok – as well as those we offer through our partners in other destinations – are excellent.

And, of course, our premium customers are able to enjoy the convenience of door-to-door limousine services in many of our destinations. We even offer a loungeto-aircraft limousine service for first class passengers at Muscat.

In the air, we operate a young, extremely reliable and rapidly expanding fleet. These ‘hard’ products are complemented by high quality service and excellent inflight dining.

Furthermore, we were the first airline in the world to offer both Wi-Fi and mobile phone connectivity, and we still lead the field in this respect.

ASIA-PACIFIC AIRPORTS MAGAZINE

Throughout its existence, Oman Air has operated a point-to-point model. This has served us, and the Sultanate of Oman, well.

An important part of Oman Air’s mission is to bring as many visitors as possible to Oman. The consistent growth in our passenger numbers parallels the growth of visitor numbers to Oman, so we have been achieving our mission.

The expansion of Oman’s airports, most significantly in Muscat, offers potential for even more visitors. Coupled with the expansion of our fleet this means that we will bring more visitors to Oman for a long time to come.

We will, however, be expanding our network significantly over the next few years. It is inevitable that a proportion of customers from those new destinations will want to transit in Muscat to onward destinations. Balancing our commitment to bringing more people to Oman with increasing ‘hub’ traffic will be an interesting challenge.

In time, it may be possible to operate double-daily to the UK. We would very much like to offer daily flights to Paris, but that is proving difficult at the moment due to restrictions by the French government.

Can an airport tempt you to provide service with incentives or do you have very fixed ideas about where your next new routes will be?

Incentives can often be helpful, but our over-riding consideration is that every route should have the potential to be profitable.

We have a very flexible approach to our network design and that flexibility will only increase with time.

What new destinations are of interest?

As mentioned, at the end of last year, we launched services to Jakarta and Manila, as well as to Duqm and Sohar in Oman. This year, we have already announced new services to Singapore, Goa and Dhaka. We may announce more new destinations, but you will have to wait and see!

In terms of increased frequencies, we are aiming to operate daily flights to many of our major destinations. That process has started with increased frequencies to many of our destinations across India.

www.aci-apa.com

AIRLINES & ROUTE DEVELOPMENT

How are you looking to develop your network?

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AIRLINES & ROUTE DEVELOPMENT Therefore there are few, if any, destinations that are beyond our reach.

With the precondition of economic viability, we are happy to consider any destination that has the potential to deliver healthy two-way traffic.

Oman’s airports have an equally ambitious development programme.

Are you happy with it?

Oman’s airport development programme is very exciting. It was wonderful to see an Oman Air jet become the first aircraft to land at Muscat’s new second runway in December last year.

While Oman Air’s airport services teams handled 8.7 million passengers at Muscat last year, the new airport will be able to welcome up to 12 million passengers a year. The next phase of development at Muscat will increase that capacity to 20 million people per year.

Such expansion offers Oman Air great opportunities for increasing the number of passengers our airport teams engage with. It also means that Oman Air will be able to operate more international and domestic flights out of Muscat and there is great synergy with our own expansion programme.

APA Issue 2, 2015

However, airport operator, Oman Airports Management Company (OAMC) is also developing a series of regional gateways.

Salalah International Airport has been further developed over recent months, and new airports at Duqm and Sohar have been opened. Further new airports at Adam and Ras Al Hadd are due to come on stream soon.

We already operate from Muscat to Salalah, Sohar and Duqm, as well as to Khasab, but the new airports mean that Oman Air’s options for operating a comprehensive domestic network are significantly increased.

Increased airport capacity also means that we are able to further increase our cargo operations. Building on previous cargo initiatives, we recently took a further step by creating a partnership with Cargolux. This will cover full freighter operations and strengthen Oman’s position as a hub for cargo being transported between Asia and Europe.

This activity has required close cooperation between Oman Air and OAMC. We have worked together very productively for many years and the results will be clear when the new facilities open at Muscat APA International Airport.

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AIRLINES & ROUTE DEVELOPMENT

Fit for purpose

Airspace in the Middle East must have the flexibility to deal with the region’s rapid aviation growth.

A

viation in the Middle East supports two million jobs and $116 billion in GDP according to a report compiled by the Air Transport Action Group.

Over the next 20 years, air traffic in the region will grow at an average 6.3% per annum pushing those figures to 4.4 million jobs and almost $350 billion in GDP generation. During that time, the number of aircraft in operation is set to increase from 1,180 to 3,300.

But these figures assume growth will not be constrained by the airspace issues that are increasingly coming to the fore. Airspace is a finite resource and particularly in the Middle East where the International Air Transport Association (IATA) estimates up to 60% of it is reserved for military use.

Tony Tyler, IATA director general and CEO, has urged the region not to follow in the footsteps of Europe, which has had its competitiveness diminished by a lack of a single European Sky. “Aviation in the Gulf is a great success story and air traffic gridlock should not become its Achilles Heel,” he says. “The players in the region need to buy in urgently to a vision for seamless airspace management in the region and then work together in a team effort to make it happen.”

SINGLE SYSTEM

That team effort is already happening. ICAO’s Middle East Airspace Enhancement Programme (MAEP) is the key driver, given APA Issue 2, 2015

that all air navigation service providers (ANSPs) in the region are state-run.

Ahmed Al Jallaf, chairman of MAEP’s Steering Committee has called for cooperation between all the stakeholders to harmonise airspace systems and procedures and achieve commonalities locally and regionally.

Many airline CEOs have backed this view.

Adel Ali of Air Arabia and Qatar’s Akbar Al Baker have both been reported as calling for some kind of regional air traffic control centre (ACC).

Baker has quipped: “I would like to see something similar to EUROCONTROL being set up in the Gulf – although we certainly do not want to emulate the challenges faced by Europe over the implementation of a single sky.

“But a single management system for the Gulf makes perfect sense,” he continued.

“The countries are located close together and our airspace overlaps. This wouldn’t affect sovereignty but would simply allow us to co-operate to improve efficiency and mitigate the pressure we are feeling from fuel prices and environmental concern.”

A single ACC would be a case of back to the future. The Arabian Peninsula used to have a single Flight Information Region (FIR) based in Bahrain. Today, that has been broken into six FIRs.

ASIA-PACIFIC AIRPORTS MAGAZINE

CONGESTED CORRIDORS

OPERATIONAL ALIGNMENT

Jeff Poole, director general of the Civil Air Navigation Services (CANSO), agrees with the notion. CANSO has described Middle East airspace as “fragmented and saturated” and Poole believes the air transport industry should transcend national boundaries.

Airspace should be aligned with the operational requirements of airlines rather than national borders.

“I believe that the lessons from Europe advise us to avoid over-prescriptive top down regulation and we should instead be looking to build from the bottom up by making cross-border changes at the operational level,” he says.

“We need to be pragmatic and incremental; meaning the plan for the region must be coherent and allow each individual element to fit into the bigger picture.”

CANSO’s Middle East ANSP, Airspace User and Stakeholder Engagement (MEAUSE) aims to achieve just that. It has the strong support of ICAO, IATA and other stakeholders, to raise awareness of the challenges facing the region and the need for much closer collaboration and integration.

Specifically, MEAUSE is focusing on combining the future equipage plans of airspace users with the investment plans of

The flexibility of the region’s airspace must be improved if air traffic management is to match growth on the ground. There are new airports or planned developments at Abu Dhabi, Doha, Dubai, Jordan and Muscat to name but a few.

Dubai is now the world’s busiest international gateway, forecasting some 79 million passengers to pass through its doors in 2015, and yet will have room to spare given a projected 240 million passenger capacity build-out at Al Maktoum International.

In the air, Dubai’s General Civil Aviation Authority (GCAA) forecasts 1.13 million flight movements in 2020, growing to 1.62 million movements a decade later. “As a result the current airspace capacity needs to be further enhanced to meet with the forecasted growth and expansion plans,” says Nils Svan, vice president of strategy at Dubai Air Navigation Services (DANS).

DANS is moving beyond policy level decisions and making real implementation efforts. Dubai is expecting to welcome around 20 million visitors in the line up to Expo 2020 and, as a result, DANS is focusing through its operations on increasing airspace efficiency through investing in cutting edge technology, manpower, safety, research and development that will enable the organisation to meet with the forecasted growth in air traffic capacity.

On an international level, DANS has agreements set up with key organisations including EUROCONTROL, Mitre (the research and development agency), and has joined the Civil Air Navigation Services Organisation (CANSO).

So progress is being made. But each aircraft that is delivered to the Middle East adds to the potential congestion of the region’s airspace. On the ground, there is not an issue but the efficiency of the major hubs could soon unravel if air traffic management does not match their APA achievements stride for stride. www.aci-apa.com

AIRLINES & ROUTE DEVELOPMENT

ANSPs. This will involve studying the present infrastructures of airspace users, ANSPs and other aviation stakeholders.

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CONSTRUCTION NEWS

DESIGN & BUILD

Incheon International Airport

W

hen Incheon promises to do something it generally does, so it should come as no surprise to anyone to learn that its giant new Terminal 2 is on schedule for completion in September 2017 as planned.

The timing, to ensure an early 2018 opening, will actually be perfect as at the current growth rate Incheon’s existing passenger terminal and aprons will reach full capacity at the end of 2017.

Indeed, to make sure everything goes to plan, the design and construction phases have overlapped with each other since work started on the excavation of the T2 site in June, 2013.

Operator, Incheon International Airport Corporation, appointed the HeerimMooyoung-Gensler Consortium to design its new 72-gate terminal, which is being built in two phases to ensure that the gateway is APA Issue 4, 2014

KEY FACTS LOCATION: PROJECT: DELIVERY DATE: CONTRACTORS:

Incheon, South Korea New Terminal 2 2017 Heerim Architects & Planners, Mooyoung and Gensler; Hugh Dutton Associés; Landrum & Brown; Lea+Elliott; BNP Associates; Hanil Mec; Woowon; Daeil; Yungdo, Wilmotte & Associés.

capable of meeting rising demand until 2023 and beyond.

Upon opening in 2017, the 384,336sqm terminal will be equipped with 37 gates ensuring that it is capable of handling up to 18 million passengers per annum.

It will have its own Transportation Centre – complementing the existing facility – that will boast a train station, car parking facilities and a bus terminal.

Terminal 2 – which with future expansion will be capable of accommodating 46 million passengers annually raising Incheon’s capacity to 90mppa – is also expected to

ASIA-PACIFIC AIRPORTS MAGAZINE

Corporation, says Heerim Architect & Planner’s vice president and T2 project architect, Byungkoo Lee. “We focused on the three main design concepts of green, eco and smart for Terminal 2 as we want it breath nature, meet high sustainable practices and utilise the latest state-of-art technologies for outstanding safety and convenience,” Lee tells Asia-Pacific Airports magazine.

He notes that renewable energy sources such as solar photovoltaic panels and geothermal systems will provide at least 10% of the terminal’s power, making T2 one of the world’s most energy efficient terminals.

While technologies such as U-signage, Self Check-in and Self Bag Drop will definitely make it technologically smart.

Gensler agrees that the terminal will be unique in its design, easy to navigate and fun to use.

Keith Thompson, Gensler principal and leader of the firm’s global aviation design practice, says: “We designed Terminal 2 to make travel at Incheon even more compelling, offering people unprecedented ease and convenience.

“It’s a large international terminal, yet it will be very intuitive to navigate and present unique experiences like the vast interior gardens featuring native Korean foliage. Travellers will see this as a new benchmark for airports.”

What does the airport hope the new terminal will bring to Incheon or help it achieve?

“It will be a cornerstone of our future success as we aim to become the hub of Northeast Asia handling around 100 million passengers yearly,” says Incheon International Airport’s president and CEO, Park Wan-su.

“It also fits with our ‘airport in the park’ concept and will ensure that we continue to grow in an eco-friendly, sustainable fashion where the environment is always top of mind.”

APA www.aci-apa.com

CONSTRUCTION NEWS

incorporate advanced sustainable technologies to create an efficient, healthy and comfortable environment.

In line with its ‘green vision’, T2 will feature an indoor garden and green spaces with natural daylight while outside it is to be surrounded by what it calls an “astonishing” green space that will include waterfalls and ponds.

The heart of the terminal will be a Great Hall, a key vertical core space created by T2 art consultant, Wilmotte & Associés, which was involved in the design process from a ‘cultural experience’ for the airport’s Terminal 1 and main Concourse.

Incheon believes that an abundance of natural daylight into the Great Hall will create a space that passengers can rest and enjoy as well as experience special events such as concerts and shows.

Without doubt reflecting Korean culture and creating a ‘sense of place’ is very important to the airport, which insisted that both aspirations proved integral to the terminal’s design.

“A lot of effort has gone into creating a strong sense of place, in fact we designed the terminal ceilings in a way to accentuate the unique streamlined shape of the terminal from the building interior,” says a spokesman for the design team.

“Vast skylights at the Transfer Area and Q-tip areas, the ends of the wing, are integrated with the indoor green features to create a rich nature-friendly ambience to the space.

“The check-in areas and departure corridors will also be equipped with skylights and louver ceilings to illuminate the terminal with natural light to hopefully create a dynamic and pleasant indoor environment for passengers.”

Other amenities include a landside shopping district; aircraft observation deck and family lounges.

Being ‘green’, ‘eco-friendly’ and ‘smart’ were also high on the list of requirements of Incheon International Airport

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IN THE SPOTLIGHT WBP PROFILES

BENGALURU BOOST FOR NUANCE AND SITA Bengaluru’s Kempegowda International Airport has opened a new duty free store and invested in new passenger processing technology designed to boost its operational efficiency.

According to Nuance, its new 900sqm duty free store treats passengers to a walk of nostalgia and rich South Indian tradition because it “embraces Bengaluru’s opulent heritage and culture” as well as offering lots of tempting duty free offerings.

Bangalore International Airport Limited (BIAL), managing director, GV Sanjay Reddy agrees, enthusing: “We believe that travel is all about new experiences and airports are a touch-point for the travellers to interact with the region. Our attempt is to make sure that every commercial space at the airport provides a sense of place and embodies the local culture, heritage and aesthetics.

“The Nuance team has done justice to our vision and developed the new duty free experience to fulfil a memorable shopping experience to our passengers.”

Meanwhile India’s ‘Silicon Valley’ airport has opted to use SITA technology to help it manage more than 15 million annual passengers, signing a seven-year, multi-million dollar contract with the technology giant for it AirportConnect Open passenger processing platform and BagManager reconciliation service.

BIAL’s president of airport operations, Hari Marar, says: “Adopting next generation technology to enhance the overall passenger experience is natural for an airport which is the gateway to one of the top technology Innovation hubs in the world.

“We chose SITA because we wanted a single supplier that could provide a complete passenger processing platform and baggage reconciliation system. SITA has a proven track record in delivering innovative solutions to airports globally.”

Surbana International Consultants Location: Singapore Contact: David Allen, assistant vice president (aviation) Email: davidallen@surbana.com Website: www.surbana.com Surbana International Consultants is a leading sustainable urban solutions and infrastructure consultancy.

Our clients value and trust us to meet their development needs. By leveraging our multi-disciplinary expertise in master planning; engineering (M&E, C&S, underground, infrastructure and coastal); architecture; project management; land reclamation; cost and contract management; and city management, we offer clients in the aviation sector a comprehensive consultancy solution.

Roland Berger Strategy Consultants Location: Shanghai, China Contact: Yingjie Zhu, infocentre manager Email: yingjie.zhu@rolandberger.com Website: www.rolandberger.com.cn Roland Berger Strategy Consultants advises major international industry and service companies as well as public institutions. Its services cover the entire range of management consulting from strategic advice to successful implementation of new leadership and business models; innovative processes and services; M&A; private equity and restructuring; and management support on large infrastructure projects. The company employs 2,400 staff in 36 countries across the globe. www.aci-apa.com

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ASIA-PACIFIC AIRPORTS MAGAZINE

DESTINATION REPORT

Lights, camera, action!

R New Zealand has much to offer beyond the movie industry spotlight. elatively small, in a remote corner of the world, New Zealand still manages to exert a major pull on airlines and tourists alike.

Not surprisingly, allowing the unassuming to thrive seems to be a trademark of the country. Tucked away in the Wellington suburb of Miramar, for example, are the movie production facilities that developed The Lord of the Rings and The Hobbit movie trilogies.

The success of these blockbusters has helped grow New Zealand’s screen industry to support almost 3,000 associated businesses with important hubs in Auckland and the Queenstown/Otago region, as well as Wellington.

Tourists are flocking to the country on the back of this movie success, especially eager to see the Hobbiton movie set in Matamata, on New Zealand’s North Island.

The colder South Island has strong appeal too. Christchurch International Airport, the main gateway to New Zealand’s

APA Issue 2, 2015

South Island is another example of a small business punching well above its weight.

“Being a somewhat small airport, in a remote corner of the world, we need to be innovative in capturing the attention of potential visitors (and airlines to carry them) to entice them to visit our place,” accepts Matthew Findlay, general manager, airlines and alliances at Christchurch International Airport.

“This involves – depending on the market – sometimes quirky and often clever ways to tell our story. Being original in presenting our compelling reasons to add capacity and to grow markets, will be where we stand out from our global competitors.”

Christchurch International Airport is marketing itself in conjunction with several different agencies depending on the need of each existing or potential new airline entrant.

Be it beautiful scenery, an adrenalin fix, relaxation or simply visiting one of the many movie sets in person, New Zealand APA has plenty to offer.