Benefits Of Airline And Airport Privatization

1971 Words8 Pages
1. Introduction
The airline industry is governed by a rapidly evolving framework of economic regulation by which many factors, significantly continued liberalisation and open skies, have caused much turbulence and uncertainty in this increasingly low margin market.

Although separate entities, airlines and airports are interdependent and could not operate without the other. A major consequence of deregulation is airline concentration and strong economic drivers are pushing towards even further concentration and consolidation (Doganis, 2006). UK airport regulation was reformed with airport privatisation, enabling a long term focus to meet international demand and to maintain a customer focused business plan, allowing management to monitor and adjust costs and boost income.

The aim of this report is to examine these consequences, and the benefits of airline and airport mergers and acquisitions, and will look specifically at the acquisition of Monarch Airlines by Jet2.com (known as Jet2(b) later in this report). It will also look at similar acquisition benefits of Leeds Bradford Airport (LBA) by Heathrow Airport Holdings Ltd (HAH).

2. Overview of Airlines
2.1 Jet2.com
Founded in 2003, Jet2.com Ltd is part of the Dart Group Plc and is the fourth largest leisure airline in the UK, serving the North and is based at Leeds Bradford International Airport. Flying to over fifty sun, sea and ski destinations across Europe and beyond, passenger numbers have rapidly increased to 5.9m in
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