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EXECUTIVE SUMMARY

Key Note estimates that revenues generated at UK airports increased by only 1 percent in 1998, despite 8.3 percent and 6.1 percent increases in passenger traffic and air transport movements. In 1998, the revenue generated at UK airports for owners reached £1.84bn. The throughput at UK airports in 1998 was 159 million terminal passengers and just over 2 million tonnes.
In 1998, commercial revenues, mainly retailing and services, overtook the aviation revenues generated by UK airports. This change in mix reflects the strategic change of UK airport operators as they become major retailers (10 percent of perfume sold in the UK is sold at Heathrow).
Some of the growth in retailing has been through duty- and tax-free goods, which account for more than 50 percent of retail revenues. The abolition of duty free within the European Union (EU) after 30th June 1999 has had an effect on revenues and profits. The effect is unlikely to be dramatic, as airports have taken strategic steps to compensate for the loss.
The market shares of UK airports change slowly, as route development is a relatively slow process, and the top ten airports have controlled between 89 percent and 90 percent of all passengers since 1990. Stansted and Luton Airports have demonstrated some of the fastest growth rates in recent years. This is largely a function of the development of low-cost carriers and regional departure. Between 1994 and 1998, London Luton's share of UK air passengers increased from 1.5 percent to 2.6 percent, while Stansted's increased from 2.7 percent to 4.3 percent.
Key Note forecasts that freight tonnage will increase by 28.5 percent between 1998 and 2003, to reach 2.69 million tonnes. Over the same period the number of passengers will increase by 42.1 percent, to 226 million.

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TABLE OF CONTENTS

Executive Summary

Market Definition

INTRODUCTION

MARKET POSITION

AIR TRANSPORT MOVEMENTS

MARKET SECTORS

Table 1: Top Airports in the World by Total Aircraft Movements, 1998

Table 2: Top Passenger Airports in the World by Total Passengers, 1998

Table 3: Top Cargo Airports in the World by Total Cargo (Tonnes), 1998Å

Table 4: The World's Top Ten Tourism Destinations by Tourist Arrivals (000), 1997-1998Å

Market Size

THE TOTAL MARKET

BY MARKET SECTOR

Table 5: UK Airport Revenue (£m), 1994-1998

Table 6: UK Airports by Volume by Passengers, Air Transport Movements and Freight (million, 000 and 000 tonnes), 1994-1998

Table 7: UK Airport Revenues by Type (£m and percent), 1995-1998

Table 8: BAA plc UK Revenues by Product Area by Value (£m) and Share, Years Ending 31st March 1996-1999

Table 9: BAA plc UK Retail Revenues (£m), Years Ending 31st March 1995-1999

Table 10: BAA plc Airport Retail Revenue Breakdown by Product Area (£m), Years Ending 31st March 1997-1999

Industry Background

INDUSTRY CONCENTRATION

EMPLOYMENT

REGULATORS AND TRADE ASSOCIATIONS

Table 11: Industrial Concentration of the Commercial Airport Sector by Share of Terminal Passengers ( percent), 1993 and 1996-1998

Table 12: Industrial Concentration of UK Airport Ownership by Share of Total UK Airport Revenues ( percent), 1998

Table 13: Estimated Employment Levels of Major UK Airport Operators, Year Ending March 1995-1998

Competitor Analysis

THE MARKETPLACE

MARKET LEADERS

ADVERTISING AND PROMOTION

Table 14: Selected Major UK Airports by Number of Passengers (000), 1994-1998

Table 15: Selected Major UK Airports by Number of Passengers by Share ( percent), 1994-1998

Table 16: Selected Major UK Airports by Freight Volume (000 tonnes and percent), 1994-1998

Table 17: Selected Major UK Airports by Revenue (£m), 1995-1998

Table 18: Selected Major Airport Operators by Turnover (£m), 1997/1998/1999

Table 19: BAA plc's Performance by Turnover, Terminal Passengers, Air Transport Movements and Freight Tonnage and Mail, 12 Months Ending March 1994-1999

Table 20: Belfast and Cardiff Airports' Performance by Passengers, 6 Months to September 1997 and 1998

Table 21: Manchester Airport PLC's Performance by Turnover (£m), Year Ending March 1995-1999

Table 22: Birmingham International Airport Ltd's Performance by Turnover and Passengers (£m and million), Year Ending March 1994-1998

Table 23: Luton Airport's Performance by Turnover and Passengers (£000 and million), 1996-1998

Table 24: Main Media Advertising Expenditure by Airport Groups (£000), 1994-1999

Strengths, Weaknesses, Opportunities and Threats (SWOT)

STRENGTHS

WEAKNESSES

OPPORTUNITIES

THREATS

Buying Behaviour

INTRODUCTION

DEMOGRAPHIC PROFILE OF PASSENGERS

PURPOSE OF FLIGHT

Table 25: UK Adults Travelling by Air in the Previous 3 Years by Sex, Age and Social Grade ( percent), 1997 and 1998

Table 26: Analysis of International Airport Passengers at UK Airports by Age ( percent), 1998

Table 27: Analysis of International Airport Passengers at UK Airports by Sex ( percent), 1997-1998

Table 28: Analysis of Terminal Passengers at BAA plc's UK Airports by Socio-Economic Class, 12 Months Ending March 1997 and March 1998

Table 29: Analysis of International Airport Passengers at UK Airports by Residency ( percent), 1997-1998

Table 30: Analysis of International Airport Passengers at UK Airports by Division of Passenger Type into Business and Leisure ( percent), 1997-1998

Table 31: Purpose of Visit of Outbound UK Residents Travelling by Air, (000 visits and percent) 1992-1998

Outside Suppliers to the Industry

INTRODUCTION

AIRPORT FACILITIES AND SERVICES

Current Issues

TRANSPORT WHITE PAPER

COMMERCIAL FREEDOM FOR LOCAL AUTHORITY AIRPORTS

PRIVATISATION, CONSOLIDATION AND OVERSEAS EXPANSION

ABOLITION OF DUTY FREE

LOW-COST AIR SERVICES

OPEN SKIES AGREEMENTS

CAPACITY CONSTRAINTS

CONSOLIDATION OF TOUR OPERATORS

Forecasts

FORECASTS 1999 TO 2003

Table 32: Forecast of UK Airport Market by Revenue, Passengers and Freight (£m, million and 000 tonnes), 1999-2003

Company Profiles

INTRODUCTION

DEFINITIONS

FURTHER INFORMATION

Further Sources

ASSOCIATIONS

PERIODICALS

DIRECTORIES

GENERAL SOURCES

HOPPENSTEDT BONNIER INFORMATION SOURCES

GOVERNMENT PUBLICATIONS

OTHER SOURCES

Text © 1999 Key Note

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