kenyanomics

  • Boeing, Airbus and African Airports

    Posted: July 9, 2007, 3:23 am by Kenyanomics

    The global aviation industry is up for a shake up. This follows the introduction of new planes by both Boeing and Airbus, and the entry of BRICs (Brazil, Russia, India, and China) into the civilian aircraft manufacturing industry. Other factors include the transatlantic aviation agreement and the rising demand for aviation services in developing countries, especially in Africa and the Middle East.

    Meanwhile, it is Boeing 787 and Airbus A380 that have been stealing the show. Their distinctive designs were influenced by manufacturers' long-term view of the worldwide air transport market. Airbus envisioned a market where airlines would prefer to operate bigger planes between far-flung hubs and lighter planes between the hubs and feeder airports. Their archrival, Boeing, envisioned a market where airlines would prefer to operate simple and cost effective planes, which will have to meet consumers' need for comfort and high frequency schedules.

    The resulting products are totally different. Boeing’s Dreamliner 787, is an elegant, midsized aircraft that's targeted for both medium and large-sized airports. Its selling points includes flier-friendly features such as speed, better humidity, and the ability to access many regional airports.

    A380 is a humongous high-capacity plane that could win a place in the Guinness Book of Records. Most airports will have to undergo extensive renovations to accommodate this mammoth aircraft. The upgrades might include: extension of runways and loading docks, installation of heavier plane handling equipment, and the improvement of baggage and immigration services (they will be handling 555-800 passengers on a full flight). That does not come cheap. South Africa’s OR Tambo International Airport in Johannesburg paid R512 million (US 73m; appx Kshs. 5b) for A380 related expansion.

    Bottom Line: I am beginning to suspect that Nairobi’s desire to accommodate A380 was behind the significant increase in the cost of renovating JKIA.

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