Экономические науки / 11. Логистика

Phd Yaroshevich N.Yu., Vyazovskaya V.V.

The Ural State University of Economics, Russia

The evolution of the Russian airport system in the post-soviet period

The article analyzes the institutional transformation of the Russian airport system in 1990-2012.

In the first years of its existence the Russian civil aviation and the airports, as an integral element of the transport system, were used mainly for military purposes and reported to the defense authorities [1].

The rapid growth of the transportation volumes in the pre-war and post-war periods changed the role and place of air transport in the transport system of the country. These changes led to a number of organizational reforms to ensure the improvement of the industry activity. In July 1964 the USSR Ministry of civil aviation (USSR MCA) was founded [2]. Thus, the organizational structure of the Civil aviation administration was a three-level system: the Ministery – the Territorial administration of the Civil aviation – the operating units. This organizational structure of management existed for about 25 years, till 1988.

One of the Ministry of civil aviation`s basic structural measures was the formation of the joint aviation units (JAU) as main production enterprises of the Civil aviation (1964). The JAU consolidated the flight detachments, the special aviation flight detachments and the airports. The JAU became the Civil aviation enterprises with a complete cycle of aircraft operations, which provided the whole complex of services to passengers and shippers, as well as the national economy. This system of the airlines management existed until 1988. By the end of 1987 a three-level management system included 363 units.

After the industry shift to a full self-financing in 1988, a two-level management system was introduced. In this new structure the territorial departments got the status of production associations, and most of the airlines got the status of structure units. After the introduction of two-level management system, all the capital assets, including aircrafts, were transferred to the books of the territorial departments. This measure was to ensure the significant increase of the aircraft fleet concentration. This was also done to create favourable conditions for efficient use of the resources and meet the population`s needs in the air transportation. By the end of 1988 the number of management objects dropped from 363 to 92. The Russian air transport system was in the state ownership and under total state control till the end of the twelfth five-year plan (1990).

The shift of the Russian economy to the market set new objectives to the air transport system. The demonopolization process began in 1991 by differentiation of the airport and air transport activities, that led to the creation of two equal air enterprises: airport and airline. The differentiation between the airport and the air company is based not only on their different production functions and a role in the air transport process, but mainly, on different principles of the revenues and profit formation, because the airport revenues are the costs of the air company. In the integrated air enterprise the costs of the airline company are made decrease by decreasing of the airport revenues. That gives a false impression of high profitability of an airline company and low profitability of an airport. The differentiation supposes that each enterprise will look for supplementary revenue sources, reduce costs and in fact increase the profitability and efficiency of their activity [3].

During the demonopolization and privatization period, the main principles were developed to share objectively the properties of the airline companies and the airports.

These principles are:

- functional and technological. The ownership rights on the movable assets depend on the priority of an airport or an airline company. This is based on their technological functions and assigned by certification requirements;

- «historical» principle helps to avoid a competitive battle between an airport and an airline company by finding a compromise in property division and similar functions execution. If a function can be done both by an airport and an airline company, using assets involved, the priority is given to that enterprise for which this activity (technological operation) is the main one.

- principle of integral management of a ground area and property assets in the airport. It is necessary to introduce integral management and legal rights of an airport development to allow other enterprises on the airport territory. After assigning the ground area to the airport, it is necessary to allocate in the property of an air company a part of the property objects and territories which are the most important for its activity. Removing these ground areas from the airport land acquisition shouldn’t obstruct its perspective development (including aerodrome area and engineering infrastructure). Other vital objects (buildings, constructions, equipment) are received by the air company on the contract basis, including long lease contracts or concession with specially fixed prices.

The air enterprise being divided into an airport and an airline company, the airport gets the complex of buildings, constructions and equipment [3].

According to the State airport register, in July 2012 62 air enterprises of 230 have a form of an intergrated enterprise. This accounts for 27% (almost one third) of the operating airports total number.

The institutional transformation of the Russian airport system includes total or partial privatization of the state airport property. As a result, appeared new organizational forms (models) (see table 1) [4].

Table 1. Organizational forms of air transport enterprises under restructuring

Form	Structure	Advantages and disadvantages
А. Two air transport enterprises of different organizational forms	SUE* «Airport» and open joint-stock company «Airline company»	- asynchronous privatization - not privatized property is given under SUE operating control and can be used efficiently
B. Three air transport enterprises of different organizational forms	SUE «Airport» based on federal unprivatized property (the administration or main operator). Open joint-stock company «Air service» based on privatized property. Open joint-stock company «Airline company» based on flight technical complex	- formation of a competitors` market - absence of the regulatory framework - complicated interaction of the three administrative boards
C. Two different joint-stock companies (main form before 1997)	Open joint-stock companies – airport and airline company	– difficulties with property division - synchronic division and privatization of property except the aerodrome which stays publuc; - inefficient aerodrome management form
D. Two state unitary enterprises	Airport and airline company	- privatization of the airport and airline company public property is made after the enterprises are divided
E. Air transport enterprise, where an airport is autonomous but not split-off. Airport property split-off, independent statement of assets and liabilities. Airport departments split-off.	Air transport enterprises: airport and basic airline company	- stagewise property division; - preparation of the departments for the division; - less hostility during the property division; - airport doesn`t have its own business.

* - state unitary enterprise

Thus, airport system transformation through reforming and transition to the market mechanisms of management, resulted in multiple and different forms of the airports property at different levels of administration – federal, regional and local. New companies and organizations appeared around airports.

However, the absence of the clearly defined state airport property regulation policies, the lack of experience in the modern airport business management under competition, the lack of the qualified and well traned staff bring into focus all the researches of the foreign experience in airports management institutional models.

Sources:

1. Karpova L.I. Istoriya aviacii I kosmonsvtiki. – Moscow, 2005.

2. Svishchev G.P. Aviaciya: Enciklopediya. — Moscow: Bolshaya Rossiyskaya Enciklopediya, 1994.

3. Volkova L.P. Upravlenie deyatelnost`u aeroporta. – Moscow.: MGTU GA, 2006.

4. Kosyanenko V.N. Osnovnye osobennosti razgosudarstvleniya predpriyatii grjdanskoi aviacii na sovremennom etape. – Moscow: MGTU GA, 1993.