What is air service development?
The launch of a new air service is a significant investment that must be backed by a strong business case. The air service development profession reduces the risk by carrying out research into the potential demand for a new air route.
Initially air service development was the domain of airlines and airports. However, tourism authorities have become more involved in recent years. Destinations and airports understand that they can proactively gain new air services if they work together to present compelling business cases to airlines.
Airlines require robust information when considering new services and traffic data is an essential part of any air service proposal. For example, network planners will look at the indirect traffic between two destinations. A high figure is a good indicator that a direct air service will meet existing demand.
New services stimulate markets where demand was previously low. Cheap flights have helped to create popular destinations, which were relatively unknown 20 years ago. Traffic forecasting can predict future passenger flows and whether they are likely to increase, decrease or plateau over time.
Traffic ‘leakage’ is also important because airports can lose passengers in their catchment areas to rivals. It is common for airports to analyse their competitors’ traffic to identify where leakage occurs and how to better serve local travellers.
Airlines consider a destination’s attractions, visitor numbers, hotel and accommodation capacity, local economy, infrastructure developments and geopolitical situation when deciding whether to launch a new route.
Why are new air services important?
Aviation is a vital component of the global economy. A study by Oxford Economics found that aviation indirectly supports 63 million jobs and is directly responsible for 10 million jobs worldwide. The total global economic impact (direct, indirect, induced and the catalytic effects of tourism) is $2.7 trillion.
Air service development is essential for airports and destinations because the economic impact of new air services is immense. They create jobs, connect businesses and boost tourism.