Discuss the Benefit of Globalization of Airport Industry

3566 Words Oct 19th, 2012 15 Pages
Synopsis
This report discusses about the benefit of globalization of airport industry. This report has two part,first one conducts the literature review which introduces the consequences of privatization and internationalization of the airport industry. And also introduces about how the benefit effect on airport companies,airlines and passengers. The second part analyses about how globalization effect on Shanghai Airport Authority which owns 2 airports in Shanghai. It is mainly focused on 2 points,define and analyse globalization effects air freight traffic and introduce the development of airport based city. 2. Introduction
Globalization,in its most literal sense,is the process of making,transformation of things or phenomena into
…show more content…
He also argues that the pace of globalization is quickening and will continue to have a growing impact on business organization and practice (Friedman, T, 2005).

3.2 Benefit of Globalisation of airport industry
Airport companies
For airport companies, the motivation for globalization is somewhat less well definedfifined. There certainly do not seem to be such obvious synergies in controlling a global group of airports as there are with airlines, particularly when the airports are operating in different regulatory environments. There is no guarantee that successful management practices at one airport will work in a similar manner at another airport. There are, of course, some quite persuasive general arguments for encouraging any business to aim for a global or worldwide presence. benefitfits can include higher returns and increased shareholder value. Also risks may be reduced by going global, thereby placing less relevance on any one national economy and lessening exposure to downturns in individual economies (Graham, A, 2003).
Airport groups can potentially reduce costs through bulk buying and joint purchasing in some areas. For example, cost reductions could be achieved with joint purchasing of equipment such as ramp buses and fire engines, and through negotiation of more favorable insurance policies. Costs could also be saved by having a single head office and through centralizing many functions
Open Document