Reconsidering the regional airport network in Norway

Abstract

Purpose The article addresses how a reduction in the number of regional airports in Norway can improve the air transport services currently characterized by expensive fares, high operating costs and leakage of passengers to larger airports. Methods Traffic and economic consequences of such structural changes are discussed referring to a case from Northern Norway in which plans exist to replace three regional airports with one larger airport. The welfare consequences are assessed using cost-benefit analysis. Results The large airport is expected to remove the need for state-subsidized flights (PSO-routes), reduce security upgrade costs, offer passengers lower fares and increase the number of domestic direct flights, as well as being profitable from a welfare perspective. Conclusions When airports are closed down municipalities must be compensated for the loss of their local airports by building alternative transport infrastructure to make this politically acceptable. It is important to bear in mind that too strong a reduction of the number of airports may weaken parts of the established hub- and spoke system, and could therefore lead to reduced service at existing hubs.