Weeze Airport, a German airport serving approximately two million passengers per year, has engaged the services of PROLOGIS Strategy to enhance its existing airline and route portfolio.
“While the airport clearly values the role of Ryanair, which operates one of its largest German bases at Weeze, the management has a strong interest in acquiring additional suppliers to serve routes that are complementary to Ryanair’s existing strong network of more than 40 destinations,” explains Stephan Nagel, Executive Vice President at PROLOGIS Strategy.
What could at first glance be seen as a routine task, is in actual fact a complex endeavor, considering the ongoing consolidation of the airline industry in Germany and Europe. Driven by the continued rapid growth of the low cost carriers on the one hand and the growth of integrated airline groups such as IAG, AF/KL or Lufthansa Group on the other hand, market concentration is quickly moving forward. Independent market players, who, in addition, are simultaneously focusing on large catchment areas and bigger airports is much to the detriment of midsized and smaller airports. The German airports are no different in this respect. In 2016, the top 4 German airports, each of which serves over 20 million passengers per year, grew by 3.5%, whereas the smaller airports with 500,000 to 2 million passengers shrank by 3%.
Despite these unfavorable general conditions for smaller airports, Weeze Airport, with the tailored support of PROLOGIS Strategy, has achieved an important breakthrough: starting this summer, Eurowings, Germany’s largest low cost airline, will introduce up to two new daily roundtrips between Weeze and the capital of Bavaria, Munich. This new Weeze-Munich route is the only higher-frequency domestic route to have been launched in the German market since the beginning of the year.
One of the central elements of PROLOGIS’s support for Weeze Airport was the proprietary QSI market model. This tool allows PROLOGIS to accurately forecast demand and revenues on routes which airports are interested in. It is an appropriate and highly reliable way of evaluating both capacity increases on existing routes and the introduction of entirely new routes. PROLOGIS Strategy uses forecasting methods and analysis principles which are identical to the route analysis methods performed by most airlines. The utilization of QSI tools for route evaluation by airports is still quite rare, but has a significant advantage: it minimizes the effort of translating an airport’s route evaluation into the methodology of an airline network planner.
“While QSI models are great for evaluating the economics of scheduled services, they have some weaknesses regarding charter flights,” says Nagel. “Since the airport also needed to increase flights to purely touristic destinations, which means attracting offerings from the tour operators, we chose other methods to acquire such new offerings.”
A second module focused on convincing tour operators to introduce new touristic offerings at the airport. Based on its strong ties with the leading European tour operators and touristic airlines, PROLOGIS performed a thorough analysis of the requisitions and supported Weeze Airport’s negotiations. This led to a first success for Weeze Airport, with Europe’s fourth-largest tour operator, FTI, and Fly Egypt launching new services from Weeze to Hurghada, Egypt, starting this summer.
PROLOGIS Strategy congratulates the airport Weeze on the acquisition of the new scheduled and charter flights. We are delighted that we were able to contribute to this great success.