1 Introduction
2 Regional airports in Norway
2.1 The airport structure
2.2 Challenges for the regional airports in Norway
2.2.1 Fare level and route services
2.2.2 Subsidised PSO-operations and airport deficits
2.2.3 Leakage of passengers to larger airports
2.3 Are fewer airports the solution?
3 The Helgeland case
3.1 Airport structure and air route services
3.2 Infrastructure improvements
3.3 The consequences of a joint airport
Category | Million NOK a | Comments |
---|---|---|
User benefits | 2,900 | Divided between 1,600 NOK for work trips and 1,300 NOK for leisure trips. |
Ministry of Transport and Communication | 1,800 | Reduced subsidies due to the need for fewer PSO-routes, including 20% taxation effect. |
Accidents, noise and pollution | 50 | Primarily due to reduced accidents (road), noise (air) and pollution (air). |
Airline companies | −100 | Reduced profits in the airline industry. |
Avinor (airport owner) | 250 | Reduced operating costs. |
Total economic benefit | 4,900 | Sum net present value of benefits. |
3.3.1 Increased user benefits
3.3.2 No need for PSO-operations
3.3.3 Changes in accidents, noise and pollution
3.3.4 Influence on airline companies
3.3.5 Impact on operating costs for airport owner
3.3.6 Profitability from a welfare perspective
3.4 Regional effects
3.5 Alternative use of aviation subsidies
4 Conclusions and implications
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A reduction in the number of airports gives each remaining airport a larger catchment area enabling better flight connections; especially direct flights to/from the national main airport.
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Better flight connections stimulate demand and have a self-strengthening effect on travel frequency by reducing passengers’ generalized travel costs.
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Fewer airports give the airport-owner Avinor reduced operating costs, thereby providing the financial platform to carry out necessary investments at the remaining airports.
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Through more efficient route operations and increased competition amongst airlines, more connections can be served on a commercial basis. This reduces the need for PSO-routes and corresponding subsidy requirements.
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Better flight connections in general, and lower ticket prices in particular, will have positive regional effects for local industry, commerce and tourism.
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Authorities should consider investments in road transport infrastructure and aviation infrastructure in relation to one another, attempting to find an economic, future-oriented and sustainable distribution of trips between the various transport modes.
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Traditional cost-benefit analysis can provide useful information as to whether a given change in airport structure is economically profitable or not.
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It is important to visualize the distributional effects of different measures and also consider relevant compensating measures for groups or regions experiencing the disadvantages of airport structure changes.