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The Economic Impact of Emirates Airline Flights on Greater Vienna

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The Economic Impact of Emirates Airline Flights on Greater Vienna The Economic Impact of Emirates Airline Flights on Greater Vienna/Austria Commissioned by con.os tourismus.consulting gmbh Altenbergerstraße 40 Hietzinger Hauptstraße 45 4040 Linz 1130 Wien DISPOSITION TABLE OF FIGURES.........................................................................III TABLE OF CHARTS.......................................................................... IV EXECUTIVE SUMMARY...................................................................... V 1. CURRENT SITUATION AND SCOPE OF STUDY ............................... 1 1.1 INITIAL POSITION............................................................................... 1 1.2 AIM OF RESEARCH .............................................................................. 2 1.3 METHODOLOGY AND LIMITATIONS............................................................ 2 1.4 CHAPTER OVERVIEW............................................................................ 3 2. IMPACTS OF EMIRATES’ FLIGHTS ON VIENNA/ AUSTRIA ................ 4 2.1 SOURCE MARKET ANALYSIS ................................................................... 4 2.2 POTENTIAL IMPACT OF ADDITIONAL EMIRATES FLIGHTS ON OTHER CARRIERS .......... 5 2.2.1 Relevant International Services by Austrian Airlines .................................. 5 2.2.2 Market Shares ..................................................................................... 6 2.2.3 Stimulation of Markets.......................................................................... 9 2.3 MIDDLE EAST- A GROWING HIGH POTENTIAL MARKET FOR AUSTRIAN TOURISM ..... 10 2.4 CONNECTIVITY BENEFITS FOR AUSTRIA ................................................... 11 3. THE METHODOLOGY FOR ECONOMIC IMPACT ANALYSIS ...............12 3.1 INTRODUCTION................................................................................ 12 3.2 ECONOMIC MULTIPLIERS..................................................................... 12 3.3 ECONOMIC IMPACTS OF EMIRATES’ OPERATIONS ......................................... 14 4. ECONOMIC IMPACTS ASSOCIATED WITH EMIRATES AIRLINE OPERATING IN AUSTRIA .................................................................15 4.1 INTRODUCTION................................................................................ 15 4.2 OPERATION 7 TIMES WEEKLY, 2010/11, DUBAI-VIENNA .............................. 15 4.3 OPERATION 13 TIMES WEEKLY, 2011/12, DUBAI-VIENNA............................. 16 4.4 OPERATION 21 TIMES WEEKLY, DUBAI-VIENNA .......................................... 17 4.5 INCREMENTAL AND TOTAL ECONOMIC IMPACTS ........................................... 18 4.6 INCREASED CARGO CAPACITY............................................................... 20 4.6.1 Export: Vienna – Dubai – 6th Freedom Destination ................................. 20 4.6.2 Import: 6th Freedom Destination – Dubai – Vienna................................. 21 i 5. ECONOMIC IMPACTS OF EMIRATES INCOMING PASSENGERS ON AUSTRIA .......................................................................................22 5.1 INTRODUCTION................................................................................ 22 5.2 OPERATION 7 TIMES WEEKLY, 2010/11, DUBAI-VIENNA .............................. 22 5.2.1 Economic Impact of Stimulated Non-resident Visitor Spending in Austria ... 23 5.3 OPERATION 13 TIMES WEEKLY, 2011/12, DUBAI-VIENNA............................. 25 5.4 OPERATION 21 TIMES WEEKLY, DUBAI-VIENNA .......................................... 26 5.5 INCREMENTAL AND TOTAL ECONOMIC IMPACTS ........................................... 27 6. ECONOMIC IMPACT SUMMARY...................................................29 7. QUALITATIVE BENEFITS ...........................................................31 7.1 IMPACTS ON AUSTRIAN MACRO- AND MICRO-ECONOMY ................................. 32 7.2 IMPACTS ON AUSTRIAN TOURISM ........................................................... 33 BIBLIOGRAPHY APPENDIX A SUMMARY OF ECONOMIC IMPACT ASSOCIATED WITH EMIRATES AIRLINE OPERATING IN AUSTRIA APPENDIX B SUMMARY OF ECONOMIC IMPACT OF NON-RESIDENT VISITOR SPENDING IN AUSTRIA APPENDIX C GLOSSARY OF TERMS ii TABLE OF FIGURES Figure 1: Rising demand between Dubai and Vienna ................................................. 1 Figure 2: Source market analysis of traffic between Dubai and Vienna based on 2010/11 data...................................................................................................... 5 Figure 3: Average market shares on Austrian Airlines/ Emirates common points 2010.... 6 Figure 4: Development of total economic impact of Emirates operations in Greater Vienna and Austria .......................................................................................... 19 Figure 5: By EK operations created full-time equivalent employment in Greater Vienna and Austria .......................................................................................... 19 Figure 6: Past and estimated annual export cargo volume on Vienna-Dubai-6th freedom route .................................................................................................. 20 Figure 7: Past and estimated annual export cargo volume on 6th freedom-Dubai-Vienna route .................................................................................................. 21 Figure 8: Development of total impact of non-resident visitors in Greater Vienna and Austria ................................................................................................ 28 Figure 9: By EK operations created full-time equivalent employment in Greater Vienna and Austria .......................................................................................... 28 iii TABLE OF CHARTS Chart 1: Total Traffic on DXB-VIE-DXB route in numbers and percentiles in 2010/11 .. 4 Chart 2: Total number of Austrian Airlines passenger bookings between Dubai and Vienna 2010 ........................................................................................ 6 Chart 3: Share of common points of Austrian Airlines & Emirates out of Austrian Airlines’ transfer passengers between Dubai and Vienna in 2010.................. 8 Chart 4: Estimated new traffic from additional Emirates air services ......................... 9 Chart 5: Distribution of visitors from Middle East in 2010 ...................................... 10 Chart 6: Design of operation scenarios and economic impact data.......................... 14 Chart 7: Impact of 7 weekly services to Vienna, approx. in one year ...................... 16 Chart 8: Impact of 13 weekly services to Vienna, approx. in one year..................... 17 Chart 9: Impact of 21 weekly services to Vienna, approx. in one year..................... 17 Chart 10: Summary of direct impacts for 7, 13 and 21 weekly services to Vienna, approx. in one year............................................................................. 18 Chart 11: Touristic impact of 7 weekly services to Vienna, approx. in one year .......... 23 Chart 12: Touristic impact of stimulated non-resident visitor spending, approx. in one year.................................................................................................. 24 Chart 13: Incremental touristic impact of 13 weekly services to Vienna additional to 7 weekly flights, approx. in one year ........................................................ 25 Chart 14: Estimated incremental touristic impact of 21 weekly services additional to 7 weekly flights, approx. in one year ........................................................ 26 Chart 15: Summary of touristic impacts of 7, 13 and 21 weekly services to Vienna, approx. in one year............................................................................. 27 Chart 16: Total economic impact summary ........................................................... 30 Chart 17: Information about Emirates' expenditure in Austria.................................. 35 iv EXECUTIVE SUMMARY Emirates Airline is one of the world’s largest independent airlines and operates to a global network of over 100 cities in 67 countries. In 2004, Emirates Airline started daily opera- tions at Vienna International Airport and has carried more than 215,000 round trip pas- sengers between Dubai and Vienna in the period of April 2010 – March 2011. Starting with the Summer 2011 schedule, Emirates commenced operation of 13 weekly flights between Dubai and Vienna, meaning additional 6 weekly flights – having started daily services in 2004. A 14th weekly frequency is already planned to be added in the near future, meaning one additional flight to the existing 13 operations. For the purposes of this study, a Emirates triple daily operation has also been modelled as a possible fu- ture scenario in terms of its economic impact. Emirates contracted the Austrian company con.os tourismus.consulting to examine the potential economic impact on Austria of additional flights as described above. Con.os tourismus.consulting is specialized in the field of consulting and support of organizations, projects and enterprises with a touristic focus. Con.os tourismus.consulting has its head- quarters in Linz and Vienna, working with national and international clients from the tour- ism and leisure industry. Aim of Research & Methodology The economic impact of Emirates’ flights to Austria from 2004/2005 onwards was ana- lyzed on the basis of 7 weekly flights. A further analysis based on the Summer schedule 2011, including 13 weekly flights between Dubai and Vienna, was made and is supple- mented by an additional 21 weekly flights
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