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Capacity is ensured through an accelerated investment rate

Global air travel continued to expand in 2014, despite itbeing another year of modest growth for both the European and global economy. For the full-year 2014, travel at Swedavia’s airports was up seven per cent. A total of 116 airlines serve our airports. More than 400,000 take-offs and landings were performed.

Capacity is ensured through an accelerated investment rate

For Swedavia, the greatest increase in absolute numbers was on European routes. That was an effect of airlines such as SASand Norwegian increasing the number of destinations and addingcapacity on new and existing routes.

The most popular destinationsonce again included London, as well as Mallorca, the Canary Islands, Paris and Rome. These destinations change little over timeand are also relatively insensitive to disturbances such as politicalor economic developments.

In percentage terms, intercontinental scheduled traffic accounted for by far the largest increase, albeit from low absolute numbers. A large share of the increase here is attributable to thenine direct routes to Bangkok, Dubai, Los Angeles, New York, San Francisco, Fort Lauderdale, Tel Aviv, Casablanca and Teheran launched in 2013 and 2014. Essentially all routes, which representmajor investments by the airlines flying them, showed good growth.

Also domestically, there was good growth in passenger volume,and Swedish domestic volume is now on the same level as in the early 2000s. All of Swedavia’s airports have at least two carriersoperating there, which helps increase competition and providemore options.

A changing customer base

There is generally intense competition between airlines. This ismost apparent between larger and often national airlines, or legacycarriers, and low cost carriers (LCCs). Legacy carriers are respondingwith their own LCCs, such as Lufthansa’s Germanwings andIberia’s Iberia Express. LCCs, which operate mostly in Europe, havebegun to fly to the major airports instead of more peripheral onesand have also announced that they will have a greater presence onintercontinental routes.

There are also new players, such as Qatar Airways, Air Emirates and Etihad (United Arab Emirates), which flyto hubs such as Doha, Dubai and Abu Dhabi, which attract trafficto Asia and Africa in particular.

Swedavia’s largest airline customers today are SAS, Norwegian and Braathens Regional. Turkish Airlines, which uses Istanbul as its hub for flights eastwards, has experienced sharp growth recently. There is also competition between airports. This varies depending on the type of traffic and the airlines operating there.

If an international airline wants to launch service to Europe, the first question is not which of the Nordic airports is most attractive to operate from. Instead, northern and central regions of continental Europe compete for their attention.

But when it comes to flights to and from the Nordic market, the four major airports continuously compete with one another. Major investment programmesare currently being carried out at these airports.

Total capacity is being built to handle an additional 20 million passengers by 2025, a figure equivalent to a brand-new Stockholm Arlanda Airport. In this climate, it is important that Swedavia offers competitive prices to maintain and increase its market share. Sweden is the largest market in the Nordic countries.

Focus areas

In market terms, Swedavia sees challenges in a number of areas inthe years ahead. It is a matter of getting airlines to continue establishingnew routes to and from Swedavia’s airports and workingto increase frequency on existing routes.

Meanwhile Stockholm Arlanda Airport and Bromma Stockholm Airport are very close to capacity in peak traffic. This means that Swedavia must work continuously to maintain customer satisfaction among passengers andairlines, even though the system is already operating with very highloads.

That also means it is crucial to implement planned measures to increase capacity.The issue of Bromma Stockholm Airport’s future is thus also crucial to Swedavia’s potential to offer the access to and from Stockholm that is demanded. This is especially important since Bromma Stockholm Airport and Stockholm Arlanda Airport see the greatest use during the same times of the day.