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Let's create a win-win situation for airports

There have been reports that TransAsia Airways’ discontinuation of its Taipei-Kaohsiung and Taipei-Tainan routes and Mandarin Airlines’ planned discontinuation of its Taipei-Kaohsiung route from next month may result in all flights in western Taiwan being discontinued.

As local airlines gradually withdraw from Taiwan’s western transport corridor, domestic airport transportation volume is also dropping.

Among the nation’s 18 airports, the traffic at 12 airports dropped below 50 percent of capacity last year. In particular, traffic at Hengchun and Pingtung airports fell to between 2 percent and 5 percent.

What should local airports do now?

First, the corporatization of groups of airports should be accelerated.

Airports should be divided into groups centered around the biggest airport in the north and the south and these groups should be turned into corporations.

Led by the two main airports, they could cooperate with and support one another to create economies of scale and scope and improve airport management efficiency.

This could help smaller airports avoid crises owing to operating losses following the proposed corporatization of Taiwan Taoyuan International Airport.

From an operational perspective, corporatizing would enable airports to introduce business management principles.

Through active planning and design, the airports could then highlight their local characteristics to attract business. In addition to passengers, they could also serve consumers by becoming centers for shopping, leisure and tourism, or even scenic spots, thus acting as regional activity centers.

In so doing, they can greatly increase revenues from sources other than air travel, such as commercial royalties, rental of floor space and land, as well as usage fees for maintenance hangars.

This could improve the ratio between non-air travel generated revenue and air-travel generated revenue such as landing charges, passenger service fees, air navigation charges and air bridge charges, so that it comes closer to the international standard of seven to three.

The current ratio is four to six, which means that there is still room for improvement. In addition, these airport group corporations should hold public hearings and be subject to careful evaluation.

Airports with little traffic should be closed down to ensure that aviation resources are effectively used.

The two major airports should also be connected with high-speed or other rail transit systems to provide seamless transportation services. This would also make it easier to reach the airports and thus increase their use.

Thanks to frequent daily runs and massive transport volumes, more passengers choose to take the high-speed rail transit system to the Taoyuan Station, and then transfer to Taiwan Taoyuan International Airport by bus.

Hence, the Ministry of Transportation and Communications should negotiate with the high speed rail system to build a route connecting Taoyuan Station to the airport.

With that addition and Kaohsiung’s new mass rapid transit system, Taiwan Taoyuan and Kaohsiung airports would be connected, making it easier for passengers to make transfers, thus creating a win-win situation for passengers and airports.



Chang Yu-hern is dean of the College of Management at National Cheng Kung University and a former Civil Aeronautics Administration director-general.

TRANSLATED BY EDDY CHANG
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