The role of secondary airports after air service market deregulation and the phenomena of low-cost airlines. Case study: Ronchi dei Legionari

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5 constraints on price, capacity restrictions and market access. On routes above a certain traffic density more flights and airlines were permitted. It was not just the changes in regulation that occurred at this time. Immigration and customs controls were lifted and in 1993 a single ‘domestic’ European market was created. This was with the third of the 3 “packages” which created an “open skies” system whereby airlines from any member state could freely operate anywhere in the EU with full traffic rights. Afterwards the European Commission has been concerned with the promotion of this liberalization for about ten years (European Commission 2004, L 137 p. 60). Partly because of the liberalization of the industry, several new entrants (such as Ryanair) are born with the strong belief that there is money to be made in the industry. The most important part of this for Ryanair was that there were to be no price controls, which meant that all airlines were free to set their own fares with some limits to prevent predatory or excessive pricing. This third “package” also went further than any of the previous measures to liberalise the skies because it was not merely a bilateral agreement and for the first time allowed cross border majority ownership. In early 2004 ten new countries will be added to the EU “open skies” agreement, thus further broadening the liberalisation in terms of locations. Along with the liberalisation of air transport the European Commission decided that the airlines should now face the European Union’s “competition rules”. These competition rules cover three broad areas: cartels and restrictive agreements, monopolies and mergers, and state aid or subsidies to producers. These competition rules were required so as to ensure that the deregulation of air transport and the increase in competition that occurred was not abused by dominant airlines. This was good news for Ryanair because they now had a much bigger market to aim for as the amount of potential destinations and passengers increased dramatically. It also meant that their transition into becoming a continental airline would be somewhat protected by these competition rules. Airline deregulation did not just affect airlines, it also affected airports because the “world of non-competing airlines was mirrored by non-competing airports” (Barrett, 2000). This was because collusion between airlines restricted airport development.

Anteprima della Tesi di Paolo Tubaro

Anteprima della tesi: The role of secondary airports after air service market deregulation and the phenomena of low-cost airlines. Case study: Ronchi dei Legionari, Pagina 4

Laurea liv.I

Facoltà: Economia

Autore: Paolo Tubaro Contatta »

Composta da 54 pagine.

 

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