Strategic Expansion Proposal for Manchester Airport

Introduction

Manchester Airport, located in Ringway, Manchester, England, is an international airport initially known as Ringway Airport. It was officially opened on 25th June 1938 (Budd and Ison 2021). It is owned and managed by Manchester Airport Holdings. Besides Heathrow Airport, it is the only airport in the UK that can operate two Runaways over 2999 meters in length (Maggiore and Fitch, 2019). The airport has four terminals, one for cargo and three for passengers. The airport covers an area of about 1400 acres with flights to 199 destinations, making it the airport thirteenth globally for total destination served. For business dissertation help, one can explore different aspects of Manchester Airport's operations, like its strategic management, marketing strategies, or even its role in the local and regional economy.

Since you have seen a summary of Manchester airport, the current airport deals with specific numbers can be increased and, therefore, a proposal has been put in place. The airport is known for having a non-identical role to the other known regional airports, and this is because of its facilities, connectivity, scale, route network, and many more. Manchester Airport brings a lot of revenue and benefits to Northern Britain. So we would want to increase the total income the airport generates by increasing the number of passengers per year.

We proposed the addition of another passenger terminal, expanding the existing ones, and adding a runway. With the target of 50 million passengers a year, the new runway will increase the number of aircraft per hour from the current 61 (SidmartinBio, 2021). Expanding the existing terminals will increase each terminal to accommodate at least 3 million more passengers. The 5th terminal is expected to accommodate up to 10 million passengers when built correctly.

Propositions

Passenger Terminal

To increase the number of passengers that come to the airport, the airport will have to increase the number of terminals and expand the existing terminals. One of the main challenges airports face today is the COVID-19 pandemic, and the virus requires social distancing. Many passengers increase the challenge of observing the COVID-19 protocol, especially social distancing. Terminal 1 holds around 11 million passengers per year, and the 2nd terminal holds around 8 million passengers a year, while the 3rd terminal is 44,400 m², holds around 7 million passengers a year. A 4th passenger PremiAir VIP terminal was opened in 2019, providing extra services to passengers (PremiAir | Manchester Airport's Private Terminal, 2021). The 5th terminal will work in conjunction with the 3rd Terminal since VIP passengers who use the 4th PremiAir VIP terminal would not be many. It will not hold many passengers. The new terminal will be expected to hold 10 million passengers a year, and the existing terminals will be expanded to hold at least 3 million more passengers each year.

By observing the above figure, the airport is expected to reach 50 million passengers per year by 2030. The airport will be getting ready to cater to a large number.

Runaway

Another adjustment that could be done is adding a third Runaway; having a lot of passengers means using a lot of aircraft. The airport has restrictions to 61 aircrafts movements per hour. Having passengers with only two terminals is restricting since many flights are delayed, or passengers do not get flights, which is frustrating. The number of aircraft per hour has to increase to at least 90 aircraft to serve the 50 million passenger targets. Therefore, a third runaway will be added, which is 3000m x 45m which is closely the same as the other runaways as we want it to perform just like the others considering the distance.

Performance development

In 2019, before the global pandemic, the total aircraft movement per annum was 203,304. Domestic aircraft 34,518, scheduled aircraft 147,426, charter aircraft 11,833, private aircraft 9,527 (Traffic statistics | Manchester Airport, 2021). A new terminal will positively affect this number because the aircraft movements will gradually increase, with an estimation of 10%, if necessary. Hence, after a third terminal is added, the total number of aircraft's movements per annum will be 223,634.

For the terminal passengers in 2019, the total number was 29,363,629. Domestic passengers being 2,502,381, scheduled passengers 24,388,661, charter passengers 2,453,614, Private passengers 18,973 (Traffic statistics | Manchester Airport, 2021). When the aircraft movement increases, all the passengers will increase, hence around 70% increase in passengers for around ten years to come. The new number of passengers per annum is expected to be 50,000,000. The performance of Manchester Airport will increase once the two changes are made.

Commercial Development

The airport supports huge economic geography. With nearly 100,000 businesses and an economy worth 48.2 billion Euros (Lamonte and Cushing, 2015). With the new runaway increase in passenger terminus expansion and addition. A lot of revenue will be generated. The airport has a lot of passengers' money generated from parking spaces since every car that enters the airport pays for parking (Budd, 2016 p.243). The taxis in the airport will also be busy and pay the airport in turn.

The airport has restaurants, where the many passengers mostly eat before traveling or even after, the staff who will also have increased will also be eating in the restaurants. The restaurants pay rent to the airport hence increasing the airport's revenue. The airport also has shopping centers with more passengers; more shopping will generate more profits. The airport also has facilities such as hotels occupied by passengers who need it, another positive impact commercially.

The modifications will attract more VIPs since the airport is more popular. Manchester airport also has VIP services. More passengers bring more VIPs, which increases the revenue base to the airport since they pay more than triple the number of regular passengers to acquire the best services offered.

The implication of Increased Revenue Base

Everything has its advantages and disadvantages, the implication of increased revenue notwithstanding this opinion. The benefits of this implication to the stakeholders will be something worth a big deal. The modification will benefit it by increasing more passengers, and an increase in passengers has significant benefits to many people. When talking of stakeholders, we include the airline, the workers, the surrounding society, suppliers, media, and the union.

The favorable implication to the stakeholders

Increased employment opportunity to the members of the society

With the increased number of passengers, more workers will be needed to make it possible and not cause many delays. By so doing, the living standards of the members of the society are improved in the process. With increased living standards, the development of that area is also improved while building infrastructure and growing businesses.

Diversification of source of income to the airline

The airline will also benefit from this implication as there will be able to diversify its source of revenue by partnering with other institutions such as banks and tax services. They will also be smooth running of the airport as the form of payment will be easier and faster.

Improved living standards of the employees

The increase in passengers will be of great advantage to the employees as they will increase income. With increased passengers, the workers will earn more as there will be an increased flow of money with an increase in passengers.

Development of surrounding environment

Development induced by the airport's immediate surroundings will attach many industries that include house building, service, recreational, infrastructure development, and communication—all beneficial to the community, local, and national government by increasing employment and tax base, respectively.

Negative implication

Difficulty in the management process

An increase in the number of passengers means that new things and items need to be chipped in. The management process has been tampered with as they were used to a certain number of passengers. When managing the airport gets to a problem, it may be abrupt closure.

Cash flow

The implication of the process needs more cash flow in the business to work. When the airport uses more money to make the new project work, it may drown in bankruptcy leading to closure. The implication, therefore, needs a lot of preparation in terms of cash flow.

Technology taking over the human being

Employees may lose their jobs in the process; with the airport's expansion, more technology is employed. By doing so, some employees may end up losing their jobs to the technology brought up. Alongside this, when new workers are not added, the available workers may get monotonous, tired, and overwhelmed by the large workload they have. Therefore, they will not give their all when doing the huge workload leading to poor organization of the airport.

Conclusion

Manchester Airport is a significant asset to Northern Britain. It was a bustling airport in 2019; it was considered the third busiest airport in the UK in terms of passengers and could be busier. It is known for having a non-identical role to the other known regional airports, and this is because of its facilities, connectivity, scale, route network, and many more. Propositions for adjusting the airport by adding or adjusting certain features to increase the airport's performance. The performance is the input, and the output of the airport is majorly determined by the number of passengers the airport receives daily. The increase of passengers will therefore bring about commercial development, and more passengers will generate a lot of income which will maintain the airport and enable the airport to expand.

The changes have their impacts, both positive and negative. The positive is more income generation, and the negative impact is the more significant amount of space and money needed for expansion. Since the increase in passengers leads to demand increases; hence more staff is needed, more facilities are needed, and more of the existing features need to be expanded. Change in Manchester Airport has both positive and negative impacts that can cancel each other. With more passengers comes more revenue; this revenue is used for airport expansion and airport management.

Bibliography

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Jimenez, E. and Suau-Sanchez, P., (2020). Reinterpreting the role of primary and secondary airports in low-cost carrier expansion in Europe. Journal of transport geography, 88, p.102847.

Lamonte, J., Cushing, P. and West, E., (2015). Expanding Metrolink Through Town Centers and Residential and Urban Environments Across Greater Manchester. In 13th National Light Rail and Streetcar Conference (p. 247).

Maggiore, C., Fitch, G. and Shaw, B., (2019). Strategic Investments for the Optimisation of Airfield Pavement Performance in Major Airports in the UK. In Airfield and Highway Pavements 2019: Innovation and Sustainability in Highway and Airfield Pavement Technology (pp. 447-455). Reston, VA: American Society of Civil Engineers.

Manchester Airport, (2021). PremiAir | Manchester Airport's Private Terminal. Available at:https://www.manchesterairport.co.uk/premiair/

Manchesterairport.co.uk, (2021). Traffic statistics | Manchester Airport. Available at: https://www.manchesterairport.co.uk/about-us/publications/traffic-statistics/

Sidmartinbio.org, (2021). How many planes take off from Manchester Airport each day? – SidmartinBio. Available at: https://www.sidmartinbio.org/how-many-planes-take-off-from-manchester-airport-each-day/

Statista, (2021). Arrivals and departures at Manchester Airport 2005-2020 | Statista. Available at: https://www.statista.com/statistics/467426/passengers-arrivals-and-departures-at-manchester-airport-uk/

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