The Process and Activities of Airport Ground Services to Airlines - Term Paper Example

Describe the Process and Activities of Airport Ground Services to Airlines. Name: Institution name: Tutor: Date: Contents 1 Contents 2 Executive summary 3 Introduction 3 Key ground handling services 5 The relationship between airport and airlines 13 Conclusion 14 Executive summary Ground handling services were liberalized following the enactment of the EC ground handling directive (96/67/EC) in 1999. The airports were not allowed to handle all ground handling services but allow third parties. Ground handling is a very important part of air transport logistics supply chain as it facilities the mobility of cargo and people from one destination to another (Templin, 2007). The competiveness of a nation in the international market depends on the efficiency of ground handling. Ground handling operations are very important and they are becoming a global issue. The following part of ground handling operations are quickly becoming a global issue; passenger handling, cargo handling, ramp handling, baggage handling, security, security and human resource. The airport is a service provided by the government for instance international airports in different countries (Aaronson, 2006). Airlines are the private companies that provide airline services of transporting individuals and luggage. Ground handling activities are activities that are related to aviation on the ground which are either carried out by the airline which is referred to as self-handling, independent ground handlers or airports as the third party handling. Ground handling services which are carried out before, after and in between flights is called turnaround (Agur, 2006). These activities are so important to the airline since any delay is costly. The services are carried out concurrently to ensure maximum productivity for the air line. These services can be grouped into two major categories as landside services and airside services Introduction Ground handling services offers a vertical supply chain relationship. The relationship starts with the airport to the third party handlers and ends with the airline. There are contracts between airport and other handlers which bring up issues. The airport should have an agreement with another handler since they are going to use facilities in the airport to offer their ground services to the airline (Aaronson, 2006). This problem of having contracts with the airport by the third handlers is eliminated if the airport itself offers the ground services and the airline has to procure from them. In most European Union countries, the airports were the main ground service providers before liberalization. There was a dominating national carrier to handle ground services in the national airports in the European countries. Since the market was monopolized, independent ground service handlers had little chance to enter the market. After liberalization, the airlines were forced to reduce ground handling service cost among other costs due to market competitiveness. The European Council Directive 96/67/EC required that an airport with passengers above 2 million should open its ground service market to at least one outside supplier of these services. The table below shows the status of airport ground services as a handler in relation to other handlers (Fuhr, 2005.). The table looks at five major ground handling hub in Europe which include; London Heathrow, Paris Charles de Gaulle, Frankfurt, Amsterdam Schiphol, Madrid Barajas and Rome Fiumicino. This observation was carried out it the study by Templin (2007) after the opening of the ground service market 1998. Deregulation of the ground handling industry has resulted into an increase in independent handlers. The statistics by 2001 shows that 59% of the ground services were dominated by airlines and in 2010 it was predicted that 50% of the services will be in the hands of the independent handlers (Agur, 2006). The main aim of this paper is to define the key ground services that an airport provides to airlines, explain the relationship between airport and airlines, and to describe the process of airport ground service to airlines. The paper further defines activities of airport ground services to airlines. From the above table London Heathrow, Amsterdam Schiphol and Madrid Barajas airports have given out all ground service to other companies and they do not offer any service. The rest of the airports offer ground handling services. Key ground handling services Ground handling providers are mainly concerned with efficiency, productivity and profit maximization on investments. Ground handling services is time sensitive and requires a lot of services (ICAO, 2008). The airport is a service provided by the government for instance international airports in different countries. Airlines are the private companies that provide airline services of transporting individuals and luggage. Ground handling activities are activities that are related to aviation on the ground which are either carried out by the airline which is referred to as self-handling, independent ground handlers or airports as the third party handling. Ground handling services which are carried out before, after and in between flights is called turnaround (Beerli, 2008). These activities are so important to the airline since any delay is costly. The services are carried out concurrently to ensure maximum productivity for the air line. These services can be grouped into two major categories as landside services and airside services. These categories are further sub-dived into five groups: ramp handling, baggage handling, freight/mail handling, fuel/oil handing, passenger handling among other services below. The following are ground services: Ground Administration and Supervision Passenger Handling Baggage Handling Aircraft Services Fuel and Oil Handling Aircraft Maintenance Flight operations and Crew Administration Surface Transport Catering Services The services can be summarized in the figure below; The services listed above can be carried out by either the airline themselves, the third party or by the two parties. A company specialized in ground handling can also be hired to carry out these services. Ground services account about 8% of the passenger tick depending on the type of airline used. According to Templin (2007) ground services globally are estimated to have about 32bn €. This large market and its importance require high level of effectiveness of the ground services. Ground services are important to all stakeholders, the customers, government who regulate the ground service market, infrastructure supplier and the airline companies who are operating in the most competitive environment (Agur, 2006). Ground services were categorized as landside services and airside services. Landside facilities are used to ensure that there is quick movement of passenger to and from separate facilities. Landside facilities also ensure that passengers and baggage can be processed without necessarily being close to an aircraft physically. Airport landside are terminal buildings, access roads and parking services. Ticketing, passenger check-in and baggage handling are examples of landside services. The figure below illustrates types or landside services. Figure 1.0 ground handling overview (Source: Boeing 777 Airplane) Ground Administration and Supervision Ground administration and supervision services are part of ground handling that is carried out by airport. The handler is responsible for load control, messaging and telecommunications. They are also required to handle, store and administration of unit load. The handler is also responsible for supervision services before during or after the flight and any other administrative service requested by the airport user. The airport as the ground service provider are supposed to represent and liaison services with local authorities or any other entity, disbursements on behalf of the airport user and provision of office space for its representatives (Beerli, 2008). Security screening is another administrative task where the handler is required to screen passengers and baggage. Passenger Handling Passenger handling services include ticketing, passenger and baggage check-in, aircraft boarding of passengers and baggage. Passenger handling further involves the operation of passenger boarding. Passenger handling (source Google.com image) Surface transport The crew, passengers, baggage, freight and mail needs to be transported between two terminals in an airport. The airport users may also request special transport arrangements. Surface transport (source Google.com image) Airside facilities Airside facilities are designed in different shapes to long concourses, focus on the efficient servicing of aircraft that include fueling, loading, and unloading. The two ground services are separated with the aim of attaining flexibility and efficiency. Airside services are carried out after security check up on the airport apron. Ramp handling is an operation that requires the handler to be well equipped and staffed. Airside services can be further divided into the following categories. Source: Boeing 777 Airplane Characteristics for Airport Planning Ramp services Supervision, start-up, moving/towing aircraft and safety measures. It also involves marshaling of aircraft on the ground at arrival and departure. Aircraft marshaling (source Google.com image) On-ramp aircraft services Repair of faults, fueling, wheel and tire check, ground power supply, deicing, cooling/heating, Toilet servicing, potable water, demineralized water, non-routine and routine maintenance, cleaning of cockpit windows, wings, nacelles and cabin windows (Beerli, 2008). Fueling services include fuelling, defueling operations, storage of fuel, and quality and quantity of fuel deliveries. They are also involved with replenishing of oil and other fluids. cooling/heating Fueling aircraft (source Google.com image) Onboard servicing Cleaning, catering, in-flight entertainment, minor servicing of cabin fittings, Alteration of seat configuration. External ramp equipment Passenger steps, Catering loaders, Cargo loaders, mail and equipment loading equipment, aircraft door operation, weight and balance and baggage claim. aircraft door operation (source Google.com image) The relationship between airport and airlines Airports are important resources of any nation. They play a key role in the transportation of people and goods within the region, nationally and internationally. Airports are the connection pint of the aviation system with other transport sectors (Agur, 2006). The state and local government have the role regulates and operates airports (Aaronson, 2006). The relationship between airport and airlines can be viewed from many perspectives. An airline can be a business entity, a client, consumer of services or an operator to an airport. An airport and airline are jointly making a business project at the airport. Airport provides airlines with airport related services while airlines pay landing fees to the airport. The two services cannot be separated since they depend on each other. The two entities are also in a strategic complimentary relationship since the effort of one company does not only affect its own production but also the other side. If the airport comes up with plans to improve airport services, it increases attractiveness of the airport this effort further brings more passengers (Aaronson, 2006). Conclusion Ground services are very important to the success of airline operations. Since deregulation of ground services, three handlers have emerged. The key ground handling services are grouped as landside and airside services. These categories are further sub-dived into five groups: ramp handling, baggage handling, freight/mail handling, fuel/oil handing, The European Council Directive 96/67/EC required that an airport with passengers above 2 million should open its ground service market to at least one outside supplier of these services (Aaronson, 2006). The relationship between airport and airlines can be viewed from many perspectives. An airline can be a business entity, a client, consumer of services or an operator to an airport. An airport and airline are jointly making a business project at the airport. Airport provides airlines with airport related services while airlines pay landing fees to the airport. The two services cannot be separated since they depend on each other. References Aaronson, R. 2006. Airports benchmarking maximise efficiency, airports council international. Geneva: ACI World, 1-5. ACSA. 2010. Company profile and airports. [Online] Available: www.acsa.co.za/home.asp.pld=asp. Accessed: 21 December 2010. Agur, P.V. 2006. Business Aviation Best practices. New York: Van Allen Group, 1-5. Beerli, S. 2008. Standard Ground Handling Agreement. Zurich: Swissport,15-16. Flohr, L., 2007. Deregulierung von Bodenverkehrsdiensten an deutschen Flughäfen -Auswirkungen auf Personal und Organisation. Diplom-Arbeit at the Berlin School of Economics. Fuhr J., 2005. Contracting Practices in the Ground Handling Market- A transaction Cost Explanation and Policy Implications ICAO 2008, Overview of Trends and Developments in International Air Transport, ICAO, Montreal Templin, C., 2007. Competition on Airports – Ground Handling Services in Europe. Case studies on six major European Hubs. Forthcoming in: Peter Forsyth, David Gillen, Jürgen Müller, Hans-Martin Niemeier, David Starkie, Editors; Airport Competition; Ashgate, 2008 Read More