A Guidebook for Airport-Airline Consortiums (2014) / Chapter Skim
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Pages 35-43
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From page 35... ...
35 Where more complex circumstances exist at an airport, there are a number of additional considerations related to the application of the consortium model that stakeholders should take into account. The mechanics of forming a consortium are fairly straightforward.
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From page 36... ...
36 A Guidebook for Airport-Airline Consortiums Similarly, experience shows that although there may be sound business reasons to implement a consortium and support for a consortium among the airlines at a given airport, there may be reluctance among airport management that prevents progress from being made. There may be a variety of reasons for this including the following: • Airport management may be committed to other higher priority activities.
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From page 37... ...
Decision-Making Guidance and Considerations 37 key airport assets. Airports also represent the public trust by ensuring the smooth and efficient operation of the airport, and protecting and promoting the interests of the traveling public and the local community.
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From page 38... ...
38 A Guidebook for Airport-Airline Consortiums It should also be noted that it is challenging to prepare an effective feasibility study without a definitive scope assignment for the consortium. Feasibility Study As is documented in Chapter 3, a financial feasibility study is almost always included as a component of the consortium formation process.
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From page 39... ...
Decision-Making Guidance and Considerations 39 reconciled after the estimated invoice period has passed. If this approach is used for capitalization, it is important for the airline parties to communicate frequently with their home offices to ensure that initial payments are processed in a timely manner.
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From page 40... ...
40 A Guidebook for Airport-Airline Consortiums • The airlines, their consultants, or legal counsel are usually responsible for the production of the access agreements that provide non-member airlines and ground handling companies access to the consortium controlled facilities, equipment, systems, and services and serve to protect the consortium by requiring insurance coverage, indemnification, and security deposits. Access agreements typically require airport approval to ensure that they are not discriminatory and will not prevent new entrants from accessing and using the airport facilities.
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From page 41... ...
Decision-Making Guidance and Considerations 41 The agreements governing the formation and operation of a consortium will usually expressly state that the obligations and liabilities of the consortium will not pass to the member airlines. The consortium will also indemnify the member airlines for any liability alleged against the airlines arising out of the consortium's activities, including the activities of directors and officers of the consortiums.
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From page 42... ...
42 A Guidebook for Airport-Airline Consortiums • The initial meeting of the consortium requires significant preparation. A draft agenda should be provided to the participants in advance of the meeting, listing all business that will be conducted.
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From page 43... ...
Decision-Making Guidance and Considerations 43 Operations Once the consortium is established and the facility, equipment, system, or service is operational, the consortium's activities should settle into a normal rhythm. A learning curve will exist during the first year of operation to assess the equipment, procedures, policies, and personnel involved with the operation.
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