THE FUNDAMENTALS OF ROUTE

DEVELOPMENT

SETTING THE SCENE

MODULE 1

asm-global.com

MODULE 1 MODULE 1 THE FUNDAMENTALS OF ROUTE DEVELOPMENT

Mike St Laurent

Vice President, Consulting - ASM

Tony Griffin

Senior Vice President - ASM

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MODULE 1 MODULE 1 ASM BACKGROUND

Global consultancy

founded in 1993 to

provide route development

services for airports

and their stakeholders

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MODULE 1 MODULE 1 COURSE PROGRAMME

Fundamentals of Route Development

1. Welcome & Setting the scene Day 1

2. Understanding your Market Day 1

3. Understanding Airlines Day 1

4. Positioning and Competitors Day 1

5. Strategy and Targets Day 2

6. Implementation Day 2

7. Basic Route Forecasting Day 2

Guest Speaker Day 2

8. Airline Deals Day 2

9. Marketing to Airlines and the “Perfect Presentation” Day 2

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MODULE 1 MODULE 1 DELEGATE INTRODUCTIONS

EXPERIENCES, CHALLENGES, OBJECTIVES

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MODULE 1 MODULE 1 HOUSE RULES

• Don’t be inhibited - Ask lots of questions

• Compare and share experiences and learn from each other

• Help us understand your objectives, we’ll try to tailor content throughout programme

• Mobiles on quiet, breaks for e-mails etc.

• Course notes electronically

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MODULE 1

WHY DO WE DO ROUTE

DEVELOPMENT ?

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MODULE 1 MODULE 1 WHY AIR SERVICE DEVELOPMENT?

Airports:

• To secure & grow business

• To establish market positioning & brand

• To gain prestige – local/regional/national

• To beat the competition

• To maximize revenues

• ROI for operating company, grow value

• To diversify customer base

• Address home carrier lack of action

Tourism:

• To attract & enable visitors

• To open new source markets, grow existing

• To diversify consumer offer, enhance access

choice

• To flex seasonality

• To support hotel/accommodation providers

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MODULE 1 MODULE 1 WHY AIR SERVICE DEVELOPMENT?

Government:

• Economic stimulus, job creation

• Connectivity

• Prestige

• Influence national carrier

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MODULE 1 Economic Impact

"The non-gaming economic impact of one British Airways flight from London to Las

Vegas is currently $91 million annually," said Cathy Tull, Senior Vice President of

Marketing for the Las Vegas Convention and Visitors Authority (LVCVA). "This flight

was the result of opportunities realised at previous Routes forums….

The economic impact of air service development is vast:

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MODULE 1 Economic Impact

SETTING THE SCENE

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MODULE 1 MODULE 1 SETTING THE SCENE

GLOBAL ISSUES

Route Dev.

World fleet orders

LCC’s

Oil prices

Middle East big 3

Aircraft technologies

BRICS Economies

Regulatory

New Era route

Development

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MODULE 1 MODULE 1 SETTING THE SCENE

EUROPEAN ISSUES

Europe

Long haul LCC’s

EU Economy

Airline deals

UK Referendum

Regulation

Terrorism

Geo-political events

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MODULE 1 Shift in Market Power

Source: IATA

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MODULE 1 MODULE 1 World’s Top Tourism Spenders (2015)

International Tourism Expenditure 2015

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MODULE 1 MODULE 1 SETTING THE SCENE

APPENDIX

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MODULE 1 MODULE 1 SETTING THE SCENE

A350-800 Range

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B787 orders and deliveries (cumulative; by year-end)

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Total

Orders 56 235 157 369 93 -59 -4 13 -12 182 41 53 1,124

787-8 – – – – – – – 3 46 65 104 62 280

787-9 – – – – – – – – – – 10 50 60

787-10 – – – – – – – – – – – – –

Total – – – – – – – 3 46 65 114 112 340

Deliveries

Boeing 787 Orders and Deliveries by Year

1. ANA

2. Etihad

3. United

4. JAL

5. BA

6. American

7. Air Canada

8. Qatar Airways

9. Singapore Airlines

10. Air India

Top 10 Airline Customers

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MODULE 1 MODULE 1 SETTING THE SCENE

A380 orders and deliveries

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Sukhoi Super Jet 100

Represents cooperation between Boeing and Sukhoi

Designed to compete with Bombardier and Embraer

products

Cost effective regional jet that costs around $35million

Highest capacity configuration totals just over 100 seats

Sukhoi Superjet 130 is designed to compete with Airbus

A320

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MODULE 1 MODULE 1 SETTING THE SCENE

COMAC ARJ21

China has been assembling aircraft under franchise for

some time

ARJ21 represents China’s ambition to take on the

duopoly in aircraft manufacturing

Launch airline is Chengdu Airlines

Cost per unit is very low at $20 million

Dense configuration is at around 100 seats.