VERONA AIRPORT – COMMERCIAL STRATEGY NETWORK DEVELOPMENT
In terms of the guidelines concerning the launch and development of air connections offered by air carriers, particularly Art. 5 letter b1), the company’s commercial strategy network development is described below.
Verona Airport established its own strategy for network development that will promote the connectivity of the airport at a domestic level, as well as within and outside the European Community by strengthening and broadening existing connections according to the needs of its catchment area: located at the centre of an Italian crossroads of primary economic and touristic interest, thus contributing towards the development of new businesses in the surrounding area.
This strategy is based on the following four key points:
1.- Home Carrier - identification and consolidation of one or more air carriers based at the airport, with the intention of offering connections required by the local catchment area for both business and touristic purposes.
2.- Network Carriers - intensification of connections towards the main European hubs in order to develop an efficient connections network towards the international and inter-continental destinations most required by the area.
3.- Point-to-Point Connections - development of direct routes to specific, local and international, destinations, with sufficient demand to sustain the route, thus guaranteeing better accessibility to the airport and, consequently, to the territory.
4.- Charter traffic - development of synergies with major tour operators, both incoming and outgoing, aimed at supporting regular charter connections, propaedeutic to their subsequent development into scheduled connections.
With the intention of achieving its objectives, Verona Airport would like to attract new air carriers, develop new destinations, whilst strengthening existing destinations, through the adoption of an incentives program based upon marketing contributions directly proportional to the investment made by air carriers at the airport.
More specifically, the incentives program is structured on the principles of objectivity, transparency, temporariness and non-discrimination and applies in the following cases:
A.- New Air Routes
The incentive shall be available to air carriers in a directly proportional manner to the:
• Number of frequencies per week operated on an annual basis (as for seasonal connections, the value shall be on a pro rata basis);
• Capacity offered on the new route, differentiating the incentive between Regional, Narrow Body and Wide body aircraft;
• Type of destination, differentiating between domestic destinations and destinations within and outside the European Community.
To be eligible for the incentives program, the air carrier shall:
• Operate the new connection with a minimum of 5 weeks of operations;
• Guarantee customers regular and continuous operation, thus limiting cancellations to 5% of the entire schedule.
B.- Underserved Routes
Underserved route shall mean:
I An already served route where a new carrier would like to increase existing capacity by 150% over the previous two IATA seasons;
II A traditionally seasonal route where the air carrier would like to extend the service even during periods of low season;
III Connection to a hub where, owing to a capacity increase, the air carrier contributes to improve connectivity of Verona Airport;
IV A route where the operating air carrier increases capacity by at least 25%, by means of an increase in the average size of the aircraft, and an increase of the number of weekly flights operated.
In the circumstances described in I, II and III above, the incentives program shall apply on the basis of the criteria indicated at point A (new air routes) but shall be reduced proportionately to reflect the lower strategic importance of an underserved route in existence on an already stimulated market, in comparison to the launch of a new route.
C.- Traffic Volumes
For scheduled airlines able to share multi-year traffic plans with Verona Airport, thus demonstrating their capacity to contribute to the effective growth of airport volumes, an incentive program is envisaged based on a defined amount per departing passenger, modulated on minimum volume thresholds, which by way of example, but not limited to, can be identified as:
- 200,000 departing passengers per year;
- 500,000 departing passengers per year and a network of at least 10 destinations.
Multi-year incentive programs may last between 3 and 5 years depending on the strategic nature of the shared development plan.
D.- Regular Charter Connections
In line with point 4, Verona Airport is interested in promoting charter traffic in collaboration with Tour Operators willing to invest in the airport with their own flight schedules and marketed through the offer of "tourist packages".
The support will be of a temporary nature that may be seasonal, annual or multi-year, depending on the extent of the shared scheduling and will be available in the form of lump sums or a contribution defined per departing passenger, based on minimum passenger thresholds and promotional campaigns that the Tour Operator will share with Verona Airport, aimed at promoting the Verona catchment area in the countries of reference for incoming traffic, as well as advertising the offer of out-going destinations in the Italian market.
To have access to the incentive program, the Tour Operator is required to operate at least 15 rotations within the same IATA season.
On the subject of incentive programs, Verona Airport considers fundamental the concept of entrepreneurial initiative and, consequently, shall be entitled to evaluate other types of incentives and co-marketing with air carriers and Tour Operators willing to develop schemes for increasing destinations and passenger volumes, which are strategic to the growth and economic sustainability of the airport.
The incentives program offered by Verona Airport shall only be available to the air carrier and Tour Operator under the conditions described above and subject to the signing of a specific contract.
Verona Airport will only enter into contracts whose incentive criteria are suitable for the internal ex-ante profitability analysis, aimed at demonstrating that the contractual commitments ensure, for the time period in question, an incremental profitability for the airport, according to the Market Economy Operator (MEO) principle established by the EU.
To apply for the incentive program, carriers should send their development program to pec.segreteria@aeroportoverona.telecompost.it.
Any incentive and marketing contribution covered by this policy will be conditional on the operating carriers' compliance with the airport tariff payment schedule.
The incentive will be paid at the end of each IATA season or as agreed between the Parties.
A necessary condition is that the carrier operates for a significant part of the relevant IATA season (at least four months for the Summer season and at least three months for the Winter season).
In the event that, during the publication of this program, more than one carrier is interested in the same incentive route, incentives will be granted to all carriers that have applied for them.
Should no expressions of interest be received through the channels listed above, Verona Airport will consider itself free to negotiate directly with carriers and Tour Operators identified outside the channels envisaged by this policy.