Monitor Characteristics Aviation Market NL-UAE

Over the last eight years, airlines from the United Arab Emirates (UAE) have established a stronger position in the market between the Netherlands and the United Arab Emirates. In 2017, Emirates provided three quarters of the seating capacity between Schiphol and Dubai, and Etihad and KLM had an equal market share on the route to Abu Dhabi. As a result of the increased presence of UAE carriers, KLM not only experiences competition on flights between Schiphol and the UAE, but also on destinations in Asia, Africa, and the Middle East that are indirectly served by Emirates and Etihad. This competition may lead to lower prices, especially when the competition results in decreasing dominance of an airline.

On behalf of the Ministry of Infrastructure and Water Management, SEO researched the developments in the aviation market between the Netherlands and the UAE. It takes into account the developments in the number of players in the market, the offered frequencies, the offered seating capacity, the offered ticket price and the numbers of passengers. The analysis focuses on both direct markets between the Netherlands and the UAE and the most important routes from Schiphol that are also served indirectly through hubs in the UAE. Finally, SEO researched the effect of an increase in Emirates’ or KLM’s market share on a certain route on the ticket price.

The developments in the aviation market have been charted through analysis of three different data sources: Global data of airline schedules, market data of passenger bookings, and ticket prices collected through web scraping. The effects of changes in market shares on ticket prices have been estimated by means of a fixed effects panel data regression model.