Can we make money in the aviation industry? Profitability in the airline vs airport business

摘要

There is a perception within the air transport industry that airports are able to achieve substantially higher profit levels than airlines. This can cause considerable friction in the airline-airport relationship. However there is only limited evidence in the literature to support these claims. Hence the overall aim of this paper is to explore this issue in depth and to compare the financial performance of European airlines and airports by undertaking both a cross-sectional assessment of the two sectors to analyse their comparative performance during the same time period and also by undertaking a longitudinal assessment to determine the comparative variability of the performance of the two sectors through time. A sample of 20 European airports and airlines is used for this analysis. Data for a long term time trend is used to take account of the cyclical nature of the industry. A number of financial and economic ratios relating to profitability, revenue generation, cost efficiency, debt/asset management and capital productivity are used. Whilst work is still very much in progress, initial results suggest that although airlines and airports are different as indicated by a range of financial criteria, they are not significantly different in terms of profitability according to a number of indicators.