Running Head: AIRPORT OPERATIONS ASSIGNMENT

Airport Operations Assignment

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 TABLE OF CONTENTS

Introduction......................................................................................................................................2

Analysis...........................................................................................................................................2

Critical Assessment of Physical Design & Capacity Limitations for Haneda Airport................2

Critical Assessment of Strategy of Haneda and Narita Airports.................................................4

Strategy of Haneda Airport..........................................................................................................4

Strategy of Narita Airport............................................................................................................5

Ibaraki Airport Current Situation & Future Role.........................................................................5

Alternative Strategy for Tokyo for serving domestic & International hub..................................6

Conclusion.......................................................................................................................................7

Appendices......................................................................................................................................9

Exhibit 1: Haneda Airport Design...............................................................................................9

Exhibit 2: Haneda Airport Capacity...........................................................................................10

Exhibit 3: Passengers at Haneda Airport...................................................................................11

Exhibit 4: Passengers at Narita Airport......................................................................................12

Exhibit 5 Passengers & Growth Rates.......................................................................................12

References......................................................................................................................................13
 Airport Operations Assignment

Introduction

In this report, we attempt to perform the critical assessment of all the different airports,
their strategies and the airport operations in Tokyo, Japan. The focus will be especially on the
two main airports of Tokyo, which are the Haneda Airport, and the Narita Airport. Ibaraki
Airport is also one of the prominent airports in Tokyo however, its significance is diminishing.
We would also be assessing the operations of this airport and the future position of the airport.
The aviation and the airports of Japan have been experiencing tectonic shifts and the market has
become mature over the past several years.

This has resulted in gradual growth of the airports and their operations in Japan. New
strategies and technological investments need to be made to enhance the effectiveness of the
services provided at the airports. Both the major airports of Tokyo are at capacity and therefore,
there seems to be a strong need for development of new plans and the immediate implementation
of the current plans. We have also discussed the proposed and the alternative strategies of the
different Tokyo Airports for serving the larger market and the point to point traffic in this report.

Analysis
Critical Assessment of Physical Design & Capacity Limitations for Haneda Airport

An airport can be defined as a place or a physical site where the actual transfer between
the air mode and the surface mode takes place. Therefore, it is highly important that the airport
provide all sorts of the tools, operations, facilities and the services that are required for the modal
transfer (Horonjeff, 1999). This means that if any of the airports have any sort of limitations or
they do not have enough facilities and services for the visitors then the flights can experience
delays and there might be safety issues such as accidents at the airports. The airport designing
staff needs to take into account the takeoff and landing of the aircrafts, handling of the
passengers and the landside access of the surface transfer modes (Dempsey, 2002). If all of these
measures and facilities are provided in advance then only it can result in a successful and a
smooth modal transfer between the air and the land surfaces.

The 21st century is the century of the technological advancements and there have been a
number of great advancements taking place within the airport operations and the aircraft
designing. These include changes to the congestion, computerization, privatization, hubbing,
route structure etc therefore, the aircraft designers need to be more flexible in designing the
physical design of the airports for providing consistent services to airlines, cargo and the
passengers (Nagata, 2010). If the airports are managed efficiently and the operations of the
airports are, more flexible then this also results in higher efficient operations of the management
and a much higher profitability and revenue for the airports (Dempsey, 2002).

If we look at the designing of the physical infrastructure and the physical structure of the
Handea Airport then we can clearly see that the Haneda airport design has been made based on
the universal concepts (Clarke, 2017). All the elderly and handicapped visitors who visit the
Haneda Airport are provided with the assistance services by the staff members of the airport. The
design of the airport is made up of sculptural stainless roof of steel clad and it is punctuated with
the skylights for providing the natural sun light to the passengers (Chi, 2009).

The airport designing structure is also depicted in exhibit 1 in the appendices. The new
terminal has also been designed which service as the centre of the complete gathering space of
the new terminal that has been established at the airport (Airport, 2016). The design has been
completed by keeping in view the safety and the security standards of the Tokyo government,
aviation authorities and the airport designing companies. Access to the restricted areas is
controlled through placement of the security doors and designing of the different concourses
(Airport, 2016).

In addition to the designing of the Haneda Airport, if we analyze the impact of the
limitations of the services, capacities and the facilities provided by the airport then we have seen
that such factors tend to have a very clear negative impact on the revenues, pricing and the
operations of the airports (Dender, 2007). According to the Economic Theory, it has been proved
that when there are limitations placed on the capacity of the airports then the fares of the airports
also tend to be higher for accommodating the higher or the increased demand of the airports.
This means that when the management does not have enough capacity then it meets its revenue
and profit objectives by increasing the prices of the tickets (Chi, 2009). When the demand is in
excess then also the airport authorities tend to increase their fares. In addition, when the capacity
of the airport is increased then the demand remains same, additional competition would be
created and it would scarcity the rents away. Overall, the reduced scarcity rent would cause the
airfares to fall. However, the consequences of capacity limitations are more worse (Chi, 2009).

If we look at the capacity and the level of the unused capacity for the Haneda Airport,
then we can clearly see that the capacity for the Haneda airport is 100% full. The current hourly
aircraft movements and the movements restrictions for the passenger departures are shown in
exhibit 2 in the appendices. The exhibit 2 shows that the slot of the departure of the customers is
completely full at the time of the day however, the time when the capacity remains unused for
some of the passengers are 6:00 in the evening and the slot between 14:00 to 16:55 (Horonjeff,
1999).

At the night hours, most of the airports close and there are some of the airports that are
still operational and the operations of some of the airports are impacted by the curfews in the
night. Therefore, as a result of these factors the traffic during the night hours increases at the
Haneda Airport as there is a sharp decline in the other operations of departures at the other
airports between the time slot of 20:00 to 5:50 as a result of the above stated factors. The current
ratio of the international passengers is also low at Haneda airport as compared to the domestic
passengers however; this has been growing and is estimated to grow in future as well (Dender,
2007). The statistics for the number of passengers is shown in exhibit 3 in appendix.

Critical Assessment of Strategy of Haneda and Narita Airports

The Japan Airport Terminal group has a long term goal and a vision for making the
operations of all the airports in the country efficient and also to follow the long term vision of the
government of the country for constructing new airports in the country and also improving the
operations of all the current major airports in the country so that higher level of revenues can be
realized and that complete satisfaction is brought to all the visitors and the international tourists.
The group has also set he objectives and the agenda for a medium term business plan for
achieving all the objectives of the airports and making their operations more effective. The main
goal of this medium term business plan is to make the airports of Japan as the world best airports
by the end of the year 2020 (JAT, 2016). There are a number of difficulties that are being faced
by the group and the group is already aware of such difficulties. For instance, one of the major
problems facing the government and such aviation organizations is the dwindling and the
uncertain economy of the country, which has not been performing up to the mark during the past
several years. As of result of this, the government of Japan has increased the influx of the
inbound visitors within Japan (Airport, 2016).

There are some important reasons due to which the economy of Japan has been slowing
down and the most evident reason among these is that the economy of Japan is highly dependent
upon the economy of China and the slowdown of the Chinese economy has affected it
(Dempsey, 2002). The economic growth of China that has been driving the economy of the
world and the normalization of the geopolitical risk is another major challenge (Horonjeff,
1999). The Haneda Airport is considered as the international airport of the country and there are
a number of factors that have increased the internationalization of the Tokyo International
Airport.

One factor is the Paralympics and 2020 Tokyo Olympic games (Johnson, 2010). The
current strategy of the group is to build new airports and to improve the designing of all the
current airports of the country by expanding their operations and improving the facilities that are
provided by these airports. Furthermore, the focus of the group is also on the designing of the
new airports in order to boost the revenues and the profitability (Nikkei, 2015). The management
of the group is committed to achieve these objectives by emphasizing on four key areas, which
are engagement of stakeholders, earnings capacity, capability development and airport
management. In the next section of the report, we assess and discuss the strategies at the Narita
and the Haneda Airports.
Strategy of Haneda Airport

The Haneda Airport is the international airport of the country and it provides the country
with a funky international gateway to Tokyo for enhancing the reputation of the city and also
preserving the proud ancient culture of the country. The net international terminal that has been
opened in 2010 at Haneda Airport can get the passengers from the airport to downtown Tokyo in
maximum 30 minutes (Johnson, 2010).

All those passengers that are travelling from Yokohama or the Central Tokyo find it
convenient to visit the Haneda Airport. The airport has a small terminal and all the visitors find it
easy to navigate this terminal of the airport. This airport had been designed to boom the
sparkling growth of tourism in Japan. Many airlines have started to take advantage of this airport
by setting higher fares at Haneda than the distant airport Narita. Peach Aviation has been the first
airline to offer international flights at the Haneda Airport (Nikkei, 2015).

The total number of the passengers that depart from the Haneda Airport on an annual
basis is around 80 million and around 70% of these departures take place as a result of the
domestic travelers. Haneda Airport is connected to the major cities in Japan and around 590
direct flights are handled per day to around 50 airports (Johnson, 2010). Haneda Airport
functions as one of the most important domestic air hub of the domestic air transportation of
Japan. The number of the foreign visitors at the Haneda Airport had increased significantly in
2016 and thus as a result of the foreign influx of the customers, the total number of the
passengers at the Haneda Airport had increased by 4 million in 2016. The growth rate for the
increase in the number of the domestic and the international passengers at the Haneda Airport
has been 64% and 19% respectively (Kyodo, 2016).

Strategy of Narita Airport

The greater Tokyo area of Japan is served by the Narita Airport of Tokyo. The year 2016
has marked an impressive year for the growth of international and the domestic passengers at
Narita International Airport. Narita Airport is one of the most predominant international airports
of the country. The number of the total domestic passengers in 2016 has reached to around 37.32
million, which is a growth of around 5% for the year (Narita, 2015).
 According to the Narita International Airport Corporation, there has been a rapid growth
in the number of the domestic flights as a result of the significant upsurge in the number of the
domestic passengers. The number of the domestic passengers has been increased as a result of
the increase in the number of the low cost carriers at the airport. On the other hand, the growth of
the international passengers has increased by 23% to 30.6 million because of the expansion of
the new routes in 2015 (Narita, 2015). In the year 2014, the Narita Airport had experienced as
decline in the number of the international passengers and the reason was a larger increased in the
number of the international passengers at the Haneda Airport (Airport, 2016). The complete
statistics for the Narita Airport are shown in the exhibit 4 in appendices and exhibit five in the
appendices show the number of passengers and the growth rates at the Haneda and Narita
Airports.

Ibaraki Airport Current Situation & Future Role

Ibaraki Airport is the third largest Airport in Japan, which located in the Omitama City,
Ibaraki prefecture, Japan. This airport is located at 85 km north of the Tokyo and it services as a
low cost alternative to the larger Haneda and Narita airports. The airport has only one flight per
day and it has been built with the large public investment and thus it is criticized by the public
and also considered as one of the wasteful investments of the government of the country (Ibaraki,
2016). The number of the passengers of Ibaraki Airport according to October 2016 data shows
that the number of domestic passengers is 277958 and the number of international passengers is
105006. The total number of flights in the year 2015 has been 554,350 (Airport I. , 2016).

The demand at the Ibaraki Airport has been falling since the establishment of the airport
despite the fact that the prices of the airport and the fares are much lower for the Ibaraki airport
as compared to the other major airports in Tokyo. The airport was built and it became functional
in the year 1993 but the number of the passengers has been falling since that year. The main
problems with the Ibaraki Airport are that the costs of travelling or getting at the airport are
much higher and it had not been built to a convenient train line. Looking at the factors it seems
that the potential role of this airport is not of much importance within Tokyo however, the
situation seems to be changing now. If Ibaraki wants a peak in its future then, it needs to not look
further away than 100 km to Fukushima Airport (Asiaone, 2014).
 Ibaraki Airports has many attractive features such as the restaurants, observation decks
and the shops that offer the agricultural products and as a result of these attractions; the airport
has now been acting as a magnet for the tourists. However, the management of the airport is still
facing a number of challenges to increase the number of the passengers at the airport and
significant efforts are also being made by the airport authority to increase the percentage of the
airport occupancy by raising the recognition of the airport are achieving some success (Asiaone,
2014).

The airport is currently offering three flights per day from and to Sapporo, Naha and
Kobe and it offers an international round trip between Shanghai and Ibaraki except Wednesday.
The officials and the management of the airport believe that the airport operations have gained a
great momentum and the seat occupancy of the flights is also likely to increase in the year 2017.
The number of flights has also increased to three flights per day as compared to the one flight per
day (Airport I. , 2016). The strategy that has been established to increase the seat occupancy and
attract new visitors is to open new convenience stores at the airport. Therefore, looking at all of
these factors it is clear that the potential of the Ibaraki Airport within the complete airport
networks in Tokyo seems to be significant for the future and that it would also be a major
contributor to the economy of the country.

Alternative Strategy for Tokyo for serving domestic & International hub

Tectonic shifts are being experienced by the aviation industry of Tokyo and the overall
Japan market. The Haneda Airport plan is still in progress but it has been completed by 50%
however, still there is a long way to go to maintain the international competitiveness with the
major international airports of the world. The Haneda and the Narita Airports are the two major
airports in Tokyo but they do not serve a number of the international destinations around the
world as compared to a number of other airports within the Asian region. The Tokyo’s pair
serves only 92 airports as compared to 131 international cities that are services by Inchean and
Gimpo of Seoul (IATA, 2016).

Haneda Airport had focused on only the domestic flights between the years 1978 and
2010 however, as the demand and the influx of the international visitors and tourists has grown,
the airport has also added an international service flight. The proposed plan is to serve the
densely populated metropolitan area of Tokyo during the three-hour window in the afternoon
(Clarke, 2017). The Ministry of land, transport, infrastructure and tourism of Japan had
explained the two-phase process in 2015 to the representatives of the townships and the local
cities. Further discussions over this two-phase plan in 2016 have produced no specific objections
to the plan (Clarke, 2017).

Currently, there are a number of aggressive targets that have been set by the officials of
all the major airports of the country for attracting a large number of the international tourist
arrivals. In the year 2016, Japan had welcomed around 24 million international tourists however,
in the year 2020 when the Olympics would be held in Japan then the number of the international
tourists is expected to be around 40 million. These 40 million tourists are expected to spend 70
million dollars and the 2030 target set by the government is to attract some 60 million tourists
and the total spending of these tourists is expected to be around $ 130 billion (Aviationvoice,
2017).

According to the Civil Aviation Bureau of Japan, during the next two years that are 2017
and the year 2019, the tangible development of the capacity expansion policy would allow the
airports of Tokyo to accommodate extra 39,000 new international flight movements and the
annual total would become 486,000 from the current total of 447,000 (IATA, 2016). In addition
to this, if Tokyo wants to serve as a hub to the international and the domestic passengers then
more work should also be done in the area of air traffic management. For instance, plans have
been made by CARATS for cutting the emissions per flight by 10% and it also has plans for
doubling the capacity within the congested air space by the end of the year 2025 (IATA, 2016).

The airspace will have to accommodate for the increase in the level of the air traffic.
More runaways would also be required to be built in Tokyo in future years and this will have to
be equal to the one third at Narita and one fifth at Haneda. Currently, the management of Narita
is under consultation with all the relevant parties for the construction of runways and the hourly
capacity of the airport is being expanded to increase it to 72 aircraft movements. The passenger
experiences would also be improved and air travel would become more smooth for the entire
domestic and the international passengers because of the new runways that would be built based
on the Fast Travel Initiatives of IATA (Chi, 2009).

As discussed previously that pricing or the fares at the airports is one of the key
determinants of affecting the airport traffic and boosting the revenues of the airports. Therefore,
the last important strategy for serving the point-to-point domestic and international traffic in
Tokyo should be to revise the current pricing structure and the current pricing policies that are
related to the new routes and the new airlines (Dender, 2007). The government of the country
should make new investments in acquiring new aircrafts, new airports should be made, existing
airports should be improved in terms of their operations, services and the facilities and finally
significant investments in technology should also be made to ease out the overcrowding and
make the point-to-point operations more efficient.

Lastly, there are a number of recommendations that have been made by IATA for making
the airports of the country more affordable and competitive. These recommendations would
make the airport more efficient and thus they would be able to meet the demands of the market.

Smart Security should be implemented by the airports of Japan as it will offer a more
smooth experience for the passengers by providing them with more security. The smart
security has been implemented at the Narita Airport and it cans serve as the role model
for the implementation at the other major airports.
The airports need to ensure that there is high terminal efficiency as the airports are self
sufficient for self servicing technology for the domestic operations however; many of the
features are not available for the international flights. Therefore, the airports are
recommended to take advantage of the kiosks, mobile boarding passes and the home
printed bag tags.
Air space is one of the major constraints in Tokyo and IATA has made plans to alleviate
the airspace congestion by providing room for more airspace over the central Tokyo.
The capacity is also another major factor as stated above and IATA recommends the
airport officials to introduce significant capacity enhancements by developing the low
cost terminals such as the low cost terminals that have been developed at the Narita and
the Kansai airports.
 Finally, it is recommended that there is strong level of coordination between the Narita
and the Haneda airports so that the capacity of the entire airport network of Tokyo is
developed in line with the demands of the market and the future plans of the country such
as the plans for the 2020 Olympics that would be held in Japan.

Conclusion

The government of Japan has now been emphasizing on privatizing the airports in Japan
and to bring in more expert management for making the operations of the airports more efficient.
However, before this privatization is enacted in Japan, there is a need for more appropriate
safeguards for the economic service and effective regulations. The ultimate objective of the
Haneda Airport, Narita Airport and the Ibaraki Airport should be to provide efficient operations
and high service levels at the lowest of costs to the domestic and international passengers.

All of these major airports in Japan should provide a route to the major international
airports and to the major airlines around the world to operate from and to Japan. The airport
authorities in Japan must implement the above planned and proposed strategies and growth plans
at the Haneda and Narita airports of Tokyo to enhance the effectiveness of point-to-point
services that are provided to the domestic and the international passengers. The goal should be to
make all the efforts to remain competitive in such a mature market. The International Air
Transport Association has also called in the Japan airport officials to prepare the airport for the
2020 Olympics. The goal is also to develop the airports of the country to take advantage of the
tourism growth in the country.
 Appendices
Exhibit 1: Haneda Airport Design
Exhibit 2: Haneda Airport Capacity
Exhibit 3: Passengers at Haneda Airport
Exhibit 4: Passengers at Narita Airport

Exhibit 5 Passengers & Growth Rates

Total
Airport Name Domestic Passengers International Passengers (millions)
HANEDA 51.20 28.80 80.00
Haneda 2016
growth 64% 19% 42%
NARITA 13.07 12.49 25.56
Narita 2016 Growth 5% 23% 14%
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