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Gatwick shows that airport competition is real

Did this strike anyone else as strange?  On 27 July 2014 Gatwick Airport dealt with hundreds of passengers whose luggage failed to be delivered on time. The Gatwick`s spokesman mentioned at the time that the three hour delay was caused by “resourcing issues” of the baggage handling company Swissport.  That would be the airlines’ outsourced baggage service supplier Swissport of which we speak.  Baggage handling is one of those things that airlines are required to provide, along with transport and oxygen, when you buy a ticket (and include the fee for extra baggage etc…).  Some airlines do it themselves, others get suppliers to do it on their behalf, but it is an airline obligation.  The clue there is in the words “on their behalf”. Arguably, the regulations do not allow airports to be involved in the process of unloading aircraft, but nevertheless Gatwick pulled out all stops and assisted with the transportation of the baggage to the terminal and the unloading of the bags on to carousel belts. Up to 60 extra staff was provided by Gatwick to improve Swissport’s service and to clear out the luggage backlog. The passengers were sent home and delivery of the baggage to their home addresses arranged. A promise of a maximum 48 hour delivery was made. Swissport has reported that this was an exceptional case caused by “off-schedule” arrivals and that there is no need for concern on the following weekends. Nonetheless, Gatwick has announced that they will continue monitoring Swissport’s performance and offer help as required for the rest of the summer. What is going on and what does this tell us? A few days after the incident took place, the Gatwick spokesman said it was about the high standards the airport is demanding. In other words, it was about reputation and it was about service.  This is nothing more or less than Gatwick knowing that their reputation was on the line.  Ask yourself; is that the response of a fat dumb, needs-to-be-regulated monopoly service provider?  Oh no, it does not.  That is the response of an entity that understands the commercial issues at stake. It puts into context the contention of the IATA study of airport competition.  You may recall, and we covered this in detail in our Aviation Intelligence Reporter at the time, that the IATA study is in response to the ACI study which claimed that airport competition was real.  ACI’s Airport Competition report shows that airports are in the situation of competing with one another in order to draw the traffic they want, as both passengers and airlines are footloose. Aviation has been liberalised, producing higher flexibility and a more open market for airlines and passengers. We should rejoice in that. Maybe this does not fit IATA’s model because the airlines involved are not IATA members?

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