The purpose of this report is to cover operational issues by which an international airport is suffering with. In this, the study will be on London Heathrow Airport, which is UK based and an international one serving England also. It is the third busiest airport in this world in its total traffic of passengers. It is handling maximum international passengers than any other airport around the globe (Hanlon, 2007).
Main focus of this report will be on operational issues as mentioned in a case study. According to the case, Heathrow is having a proposal of new runway for short and narrow distances in order to reduce unnecessary taxiing. If it operates it in a remote area, it results in an inefficient operation and therefore, leads to longer distance for taxiing, longer time for all the flights as well as more pollution. Major focus of this report will be on different measures Heathrow is taking at its airport (Maxon, 2014).
Layout and Provision of Facilities
- Heathrow International Airport provides various facilities for airlines and passengers. Some of them are:
- It is having family lounge for families as well as play areas for children in age of 3-9 and a game zone for age of 10-15 (Hanlon, 2007).
- For adults, it gives coffee and soft drinks along with comfortable seating arrangements.
- Heathrow is having family restaurants too at their airports for having quality food there (Windsor, 2014).
- It is also having the facility of baby change areas in each terminal.
- In terms of airline benefits, there is a facility of self service check-in as well as online check-in which is simple and safe to use.
Evaluation of Layout and Provisional Facilities
In Heathrow, terminal 1 had a lot of advantages and was successful for a long period of time. As it was covering long distance routes so passengers of this Heathrow airport got benefit of not using taxies on those areas. By terminal 2, the airport is getting advantage of various facilities, which are like spacious parking for cars and it is having cooling station too. It gives benefit to the passengers of choosing their preferable bar and restaurant among various alternatives. Because of some operational issues there, it was demolished in 2010 and combined with other building for redevelopment (Calder, 2000). According to terminal 3, Heathrow is having benefit of reduction in traffic and high improvement in security. In terms of passengers, they are getting good experience there. When terminal 2 was again redeveloped, it had better facilities and that is why, terminal 3 went into decline phase. A well developed check-in areas as well as a new baggage system were the main advantages in terminal 4. In this, both the airlines and passengers were satisfied. In Heathrow’s fifth terminal, transport network area of airport has been increased in order to cope up with large number of passengers (Hatch, 2003).
There are a lot of advantages of Heathrow’s facilities which it is providing to its airlines as well as to people using their business (Creation, 2007). Facility of family restaurants is able to earn high revenues for the business and making passengers satisfied. People who take hard drinks are having various options with them and it creates more profits for Heathrow international airport. Self and online check-in is those facilities which are helpful in providing security to people and organization. It creates high brand image in the market and gains trust of customers (Warn, 2005).
Range of Management Issues
There are various issues which are involved in the operation of airport and airline services of Heathrow international which are increasing costs in organization. These are:
As every airport is governed by the Airport Act 1986, Heathrow is also one of them. Under the terms of this act, any airport which is having its annual turnover more than Rs 1 million, are subject to price control which is being imposed by the CAA. For Heathrow, CAA made it mandatory to accomplish particular targets by delivering high service quality to the users (Graham, 2003).
Other factors Affecting Operating Cost of Airline
- Ownership and control – In privatization, the ownership and control of airports by different people can have implication on provisions as well as on operations of these airport services.
- Cost basis for charges – Everything which is charged by passengers in Heathrow is according to the costs of its operations and maintenance. Its cost of capital and depreciation cost of the assets also specifies its rate of return. So what should be charged from people is a major issue in this firm (Loverrove, 2000).
- Non-discrimination aspects – Heathrow is providing some incentives and developing some different charges for particular airlines in order to attract and retain customers.
- Cost of plane – The highest cost of an airline is plane itself. So company should make plans in order to recover this cost (Czerny, 2008).
- Number of empty seats – In case, when all tickets are not selling, airline cannot generate profits to its fullest. That can be a reason which reduces loss and increases operating cost of business (Shaw, 2007).
- Time of buying fuel – When Heathrow buys fuel that airline use to fly at the time when it is expensive, it will an increase in operating cost. To reduce that cost it should purchase it when its rate is cheap, it can save millions of dollars of the firm (Dogans, 2005).
- Different kind of planes – If Heathrow uses different kind of planes, it will require training, maintenance and repair on them while if it uses only one kind of plane, cost of these things can be saved.
- Selling through websites – To reduce operating cost, Heathrow can sell its ticket through its websites, instead of travel agent. It will save that cost which has to be given to the organization that provides plane tickets and rooms of hotel who wants to stay and travel (Creation, 2007).
- Maintenance of airport – The cost incur in the maintenance of airport including its facilities is also a reason of increase in operating cost of this airline. In order to reduce them and earning high profits, it should maintain it accordingly.
Few more sample on Airline Management-
- Operation Management of Virgin Atlantic Airways Limited
- MG 614 : Airline Management Level 4 Bucks New University
- Sample Report On Airline, Travel Agency and Tour Operations
Heathrow is one of the highest leading airlines among several of them globally. It is having some issues regarding its operating cost, for which it is taking corrective measures also. It is running its business by fulfilling all regulations and taking security measures in order to save organization from any unethical activity. It takes anti-terrorism measures to tighten the security and protecting itself as well as passengers. By getting trust and confidence of people on it, Heathrow is having high brand image in market (Garham, 2008). As it provides best quality with best technology, this feature makes it able to gain advantage over competition.
- Calder, S., 2000. Nofrlills the truth behind the low cost revolution in the skies. Virgin.
- Creation, S., 2007. Ryanair: how a small Irish airline conquered Europe. Aurum Press Ltd.
- Czerny, A., 2008. Airport slots: international experiences and options for reform. Ashgate Publishing, Ltd.
- Doganis, R., 2002. Flying off course the economics of international airlines. Psychology Press.
- Dogans, R., 2005. The airlines business. Routledge.