{"id":690,"date":"2017-03-31T17:47:58","date_gmt":"2017-03-31T15:47:58","guid":{"rendered":"http:\/\/www.aviationadvocacy.aero\/blog\/?p=690"},"modified":"2019-07-23T11:44:58","modified_gmt":"2019-07-23T09:44:58","slug":"introducing-competition-into-airport-towers-not-only-possible-beneficial","status":"publish","type":"post","link":"https:\/\/www.aviationadvocacy.aero\/blog\/?p=690","title":{"rendered":"Introducing Competition into Airport Towers: Not Only Possible, Beneficial"},"content":{"rendered":"Advocates of ATM reform are like trams. \u00a0Nothing for a very long time and then they all come at once. \u00a0Whilst the ATM Policy Institute was launching its push to put ATM reform on the agenda, COMPARE, a consortium of research institutions (Transport and Mobility, Leuven, NOMMON Madrid, Hebrew University of Jerusalem and Slot Consulting Ltd, Hungary) presented a series of studies aimed at promoting competition in the provision of ATM services in the very same city. \u00a0At the very same time.\r\n\r\nThe COMPARE studies are supported by funding from SESAR JU. \u00a0You can see the benefit of that funding in the fancy name. \u00a0It is a rule that all EU funded research projects need first to find a fancy name.\r\n\r\nThe COMPAIR workshop in Madrid presented the current status of their studies, with particular emphasis on the outsourcing of tower services. \u00a0<!--more-->It reported on the experience to date of a number of European states that have introduced competition for tower services: Spain has contracted 12 towers to newcomers; the UK 3 towers to newcomers and 8 renegotiated with the incumbent, NATS; Germany, 14 regional towers to newcomers; Sweden, 17 towers to newcomers; and Norway is planning to outsource tower at Oslo\u2019s second airport.\r\n\r\nThe main findings from the review of this increasing competition for tower services:\r\n<ul>\r\n \t<li>Competition reduces costs, with reductions of 50% or more achievable<\/li>\r\n \t<li>Competition promotes earlier implementation of technology to gain service and\/or cost advantage<\/li>\r\n \t<li>The main driver for competition comes from privatised airports<\/li>\r\n \t<li>Competition can be effective even when incumbent wins the tender but is forced to renegotiate and re-bid<\/li>\r\n \t<li>Effective tender process requires all competitors to have full access to all relevant information<\/li>\r\n<\/ul>\r\nIn principle, there is no reason why the experience of successful competition for tower services cannot be applied to competition for other ATM services. \u00a0The sort of savings that COMPARE notes would seem to make that attractive.\r\n\r\nHowever, there is a substantial difference. \u00a0For other services, the ANSP will be the tenderer. It will have less incentive to introduce competition than a privatised airport.\r\n\r\nThe current charging structure for ATM services is the threshold issue. \u00a0It affects the incentive for competition for tower services. \u00a0If the ANSP charges the airport directly for tower services the incentive is strong; if the charges are direct from the ANSP to each airline operating at the airport, the incentive is substantially dispersed. \u00a0Particularly if the airline does not see any advantage in demanding focused and personalised service. \u00a0The airline might be able to argue for such service across its network, but only if the ANSP controls a significant proportion of that airline\u2019s services. \u00a0For many airlines in much of Europe, that is simply not the case.\r\n\r\nOne outcome is clear. \u00a0Countries that have direct-to-airline charging arrangements for tower services need to introduce direct-to-airport charging arrangements if they wish to maximise the incentive for competition.\r\n\r\nCompetition will make the costs of providing tower services at each airport transparent and will expose any cross subsidy for services at regional airports. \u00a0Whoops, the postage stamp rule. \u00a0Governments will be wary of changes which expose such cross-subsidisation. \u00a0The risk is increased charges or reduced services at some smaller, usually rural, airports. \u00a0On the upside, it is a step closer to the get-what-you-pay-for; pay-for-what-you-get outcome that is the bedrock of sensible ATM service delivery.\r\n\r\nInformation on other studies by COMPARE can be found on its website: <a href=\"http:\/\/www.compair-project.eu\/project.html\">http:\/\/www.compair-project.eu\/project.html<\/a>","protected":false},"excerpt":{"rendered":"<p>Advocates of ATM reform are like trams. \u00a0Nothing for a very long time and then they all come at once. \u00a0Whilst the ATM Policy Institute was launching its push to put ATM reform on the agenda, COMPARE, a consortium of research institutions (Transport and Mobility, Leuven, NOMMON Madrid, Hebrew University of Jerusalem and Slot Consulting [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[22,13,11,12],"tags":[],"class_list":["post-690","post","type-post","status-publish","format-standard","hentry","category-air-navigation-service-providers","category-air-traffic-management","category-airports","category-competition"],"_links":{"self":[{"href":"https:\/\/www.aviationadvocacy.aero\/blog\/index.php?rest_route=\/wp\/v2\/posts\/690","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.aviationadvocacy.aero\/blog\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.aviationadvocacy.aero\/blog\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.aviationadvocacy.aero\/blog\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.aviationadvocacy.aero\/blog\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=690"}],"version-history":[{"count":1,"href":"https:\/\/www.aviationadvocacy.aero\/blog\/index.php?rest_route=\/wp\/v2\/posts\/690\/revisions"}],"predecessor-version":[{"id":691,"href":"https:\/\/www.aviationadvocacy.aero\/blog\/index.php?rest_route=\/wp\/v2\/posts\/690\/revisions\/691"}],"wp:attachment":[{"href":"https:\/\/www.aviationadvocacy.aero\/blog\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=690"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.aviationadvocacy.aero\/blog\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=690"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.aviationadvocacy.aero\/blog\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=690"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}