Abstract for: System Dynamics Based Simulation for Airport Revenue Analysis

Under increasing competition and pressure for financial self-sufficiency, airports have adopted various strategies. This paper presents a System Dynamics simulation model exploring relationships between airport, airline, and passengers through fares and fees. The case study is a small to medium size international airport (Perth, WA), fully private and light-hand regulated and the model investigates two scenarios of airport charges for two routes where five airlines operate. The changes in airport fees affect differently the airlines and the cumulated aeronautical and non-aeronautical revenues confirm the two-sided view of airport operation.