Predicting the Market Share of a New Airport in Multi-Airport Cities: the Case of Lagos

<p>The primary objective of the study was to develop an empirical model that combines the contingent valuation method (CVM) with the isochrone analysis to predict the market shares of new airports in multi-airport cities and to apply the model to the case of Lekki International Airport (LIA), the proposed second airport in Lagos, Nigeria. In addition to predicting the market share that LIA could attain, the study also identified and analyzed the catchment areas as well as the willingness to pay (WTP) of would-be LIA passengers. Furthermore, the research identified the determinants of airport choice in the Nigerian market. The CVM was used for the collection of the data; 1,176 valid in-person interviews were conducted at Murtala Mohammed International Airport (MMIA), Lagos.</p> <p>Descriptive statistics and logistic regression analysis were used to predict LIA’s market share and identify the factors that influenced passengers’ choice between the existing and the proposed second airport. Further, isochrones and passenger stated preference data were analyzed for the determination of the LIA’s catchment areas for the business and non-business segments of the Nigerian market as well as the areas of spatial competition between MMIA and LIA. With regard to the passengers’ willingness to pay, the median of the WTP values was determined through descriptive statistics. The determinants of the WTP were also identified using a multiple regression analysis.</p> <p>Using the combination of CVM and isochrone analysis, the present research predicted that LIA will attain 28.9% of the market share based on the contingent scenario presented to the passengers. Further, the study found that the exclusive catchment areas of LIA for business and non-business passengers were limited to two Local Government Areas (LGAs) of Lagos State. Passengers who chose LIA as their first choice were willing to pay NGN3000 (about $15 or 15% of an average domestic one-way ticket price) as additional fare to fly from the airport. However, the realization of the predicted market share will be contingent on LIA’s ability to attract airlines, remedy the isolation of the proposed airport site, and apply the appropriate pricing policy.</p>

Name thesis:degree_name

Doctor of Philosophy in Aviation

Level thesis:degree_level

Dissertation - Open Access

Discipline thesis:degree_discipline

Applied Aviation Sciences

Year

2016

Author dc:creator

• Fatokun, Samson Oladele

• market share
• airports
• multi-airport
• Nigeria
• Lagos
• Aviation
• Business
• Management and Operations
• Marketing

Repository record dc:identifier

https://commons.erau.edu/edt/192

OAI identifier oai:identifier

oai:commons.erau.edu:edt-1191