![]() It means that airport privatization to date has come at a cost that is borne by consumers and by airlines. The underlying cause is lack of competition in the airport sector. Operational efficiency, in contrast, is comparable to government-owned gateways, which is not what would usually be expected of a privatized entity. Studies have found that privatized airports charge more than government-owned airports and, not surprisingly, have far greater profit margins. The experience of airport privatization has been completely different, however. Since 2000, air fares have fallen about a third in real terms. As more and more airlines were privatized, competition intensified. ![]() Privatization has worked well in the airline industry. ![]() Cash-strapped, slow-moving governments are hard pushed to remedy the situation.īut asking the private sector to develop airport capacity is not the only answer-or necessarily the best answer-for the consumer. Infrastructure development is lagging behind air travel demand. Airport privatization is a short-term solution to aviation’s infrastructure crisis that must only be pursued by governments if consumer benefits are kept to the fore ![]()
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