It is 9:30 AM on a mid-September day. Few planes are parked on the runway of the Macau International Airport – a scant four aircraft are visible. Were this Hong Kong, it would be packed at this time of day. "It does not get to more than seven or eight at this hour", says Don Hunter, a veteran of Hong Kong's first international airport at Kai Tak in Kowloon. Hunter currently serves as the managing director of Menzies Macau Airport Services Ltd., which provides aviation support at the airport for passenger service, operation control, ramp and cargo handling, as well as aircraft maintenance and engineering.
In the view of Jose Carlos Angeja, CEO of Administration of Airport's Ltd. (ANA) and a former Portuguese air force colonel – a Sino-Portuguese joint venture and the entity which operates and manages the airport – much is afoot. Remarks Angeja, "The current airport terminal was built for a capacity of six million passengers (expected in 2013). The current boom was not predicted… long-term growth trends were discernable, but not double digit growth. We will reach six million in 2008!" Angeja's sentiments are echoed by Chuck Woods, CEO of Jet Asia Ltd. – the business aviation arm of gaming magnate Stanley Ho's Sociedade de Turismo e Diversoes de Macau, S.A. (STDM) – who adds "I don't think anyone could have envisioned that Macau would play such a pivotal role in the Pearl River Delta and southern China burgeoning market over a decade ago when the airport was built". Yet it is.

Congestion

Conventional wisdom holds that the airport's congestion problems are exacerbated by regular arrivals of a large number of smaller, private aircraft. According to Eva Leong from the Macau International Airport Company's (CAM) marketing department – owner of the airport and holder of a 25-year concession (expiring in 2039) – overall passenger numbers increased in 2007. "Thus far, overall passenger traffic volume is 3,954,124 and a growth rate of 12.62 percent compared to 2006. Flight movements this year are 38,258 – an increase of 6.08 percent from last year". The latter statistic seems more revealing. How is Macau to cope?
Statistics are useful to a point, but what are their practical implications for those in the trenches? According to Hunter, "During the opening of The Venetian we saw a large number of corporate aircraft traffic and parking was tight. An airport like ours will naturally have a large number of private and/or corporate jets [for gambling, entertainment and leisure]… if that is the market we attract, we should be able to accommodate and service them". Systemic bottlenecks definitely exist for local aviation.
His perspective dovetails with Angeja's, "During The Venetian's opening we saw all manner of airplanes here: [Boeing] 767s, 747s, 37s, 1011s and an L11… a saving grace for Macau is that we have no night curfew which is a major constraint internationally; we operate 24 hours a day, seven days a week". Clearly smaller aircraft are not helping congestion at the airport. Though Angeja asserts: "It is a myth we have reached full capacity, we just need to fill in the two peak slots when most people want to fly in – lunchtime being the biggest 'crunch time'".
On the above point, Woods is a partial contrarian. He does not equate airport congestion with aircraft size but attributes the problem to sharp upward trends in passenger movement and eschews arguments criticizing the airport's runway or taxiway sizes, proffering "the issue is Macau is moving more people through its airport than its capacity can handle… but wider bodies would still have congestion; it's about the number of units you can accommodate in a given timeframe". Woods, Hunter and Angeja all agree that increasing numbers of passengers will pour into Macau in the coming months and years.
To Woods, the airport's regional position is a function of capacity and size. He cites Jet Asia's US$ 100 million (MOP 799.1 million) upgrade of its current Macau-based fleet with six new aircraft from US-based Hawker Beechcraft Corp. as a sign of the company's faith in Macau's future, adding that "Sheldon [Adelson, chairman and CEO of the Las Vegas Sands Corp.] is not making things worse by bringing more aircraft to the territory… we must examine Macau's structural problems and devise creative solutions accordingly". Woods contends that "growth in private aviation is a secondary concern". Angeja concurs adding that Jet Asia's purchase of even 20 more small aircraft would have a "miniscule effect on congestion".
Both men agree that the millions who visit Macau annually undoubtedly stretch its infrastructure to no end, but also bolster its economy. Can we not afford to accommodate high-rollers who want to come to town and blow their wads of cash?

Expansion plans

In early-August, Chief Executive Edmund Ho stated to the Legislative Council that the government would extend full support to the development of Macau's civil aviation industry and that all relevant projects were being reviewed. However, airport expansion has been a recurring topic over the past five years – including promises to build longer and wider taxiways; accommodate larger planes; and more hangers and service areas. To date, there has been nothing concrete.
Hunter recommends filling up bodies of water in around the airport for reclamation purposes and new runways and taxiways can be built in their place. He concedes it is a "big civil engineering project… but all the casinos want infrastructure programs fast-tracked! He cites the airport's "world class staff, superb safety record and excellent runway" as among Macau's credits but laments the issue of parking space. "The rest of infrastructure can cope, but it would be a shame to turn away business… government and the private sector working together can make it work. If we don't build it, they won't come; they will go to Zhuhai or elsewhere where there's room. We need vision and action!" Hunter's views are shared by Angeja, who suggests where such vision may come from: "Government," he proudly asserts, adding "investment is needed but there is no shortage of money, it's just a matter of political will. ADA is not responsible for investment… but the funds required are huge, we're talking billions [of patacas] so it has to be a government-driven effort because at the end of the day, airports are a public service".
Hunter bemoans that "The airport is full at lunchtime while in the morning it is practically empty… we need to market more to fill up airport parking areas. If we started today, it would already be a day late!" However, he remains hopeful that the new passenger terminal (scheduled to be completed in 14 months) will add extra facilities such as lounges, restaurants and retail space because the "sort of person at [high-end] casinos prefers to fly in [rather than crossing by foot or ferry] and they like nice shops and eateries". Indeed, if the infrastructure is nonexistent, it is hard to see how local hotels and casinos will meet their targets.

A direct link to Hong Kong?

Reports suggest the SAR's new ferry terminal will have a direct connection to Hong Kong International Airport at Chek Lap Kok, Lantau Island – the primary hub in the vicinity for long haul flights. According to Leong, CAM "welcomes new infrastructure and construction that will develop Macau's aviation and transportation industry", believing that "regional cooperation will benefit all stakeholders".
Woods believes the idea is meritorious – as does Hunter; the latter thinks it would benefit Hong Kong and mainland China, too, because "any facility that allows passengers to exit and enter efficiently should be welcomed. It would be a shame to fly to Shanghai or Zhuhai and then have to board a ferry to Macau versus just flying or sailing from their point of origin". Angeja concurs but avers "[Sheldon] Adelson's VIP high-rollers won't go to Zhuhai: They want to land and be shuttled away by limousine straight to the casinos which we will not allow" owing to concerns of security and fairness because "we do not want claims of preferential treatment; we want to treat all equally to the fullest degree possible."

Is Macau too expensive?

The general consensus is Macau's aviation sector has a competitive cost structure both globally and regionally. Hunter contends costs here are "just right when compared to the Pearl River Delta and Hong Kong's exorbitant charges!" According to Jet Asia's Woods': "Macau's handling and fuel fees are reasonable for Asia." Angeja goes one further recommending that the authorities should levy higher charges, especially to those that taxi longer than necessary.

Global Connections

The relative lack of international and regional flights has long been regarded as one of Macau's drawbacks. Leong advises: "To cope with upward tourism trends and the MICE industry, Macau International Airport is aggressively and continuously developing more international air transportation networks with all partners in the supply chain, like Macau-based flag carriers [Air Macau] and expects some good news in the near future".
Aspirational statements notwithstanding, Hunter believes it is a shame that no local airline is a real long haul carrier other than Viva Macau which "flies to Sydney thrice weekly. It is regrettable for cargo too because casinos want fresh produce from Australia and New Zealand which is currently flown to Hong Kong and then shipped locally". Analysts think there is a need for long haul carriers to aid the city's economic development which to Hunter means "more marketing is needed".
Angeja disagrees thinking that marketing aviation is superfluous because "Macau is where it's at… we have not built it fully and they are already here", he chuckles, adding that the real issue is "physical conditions need to be met… rotations need to be 25-30 minutes long – no more! Yet long haul flights keep pushing the envelope of what is acceptable because they know any surcharges incurred will be relatively minimal. This is worth noting because at many European airports, if airlines do not swiftly check-in and board passengers, they may have to pay for an additional 30 minutes of time even if they are delayed by a few minutes. This is problematic in Macau's case as long haul flights typically take three hours to service and refuel.
Angeja elaborates: "We need a runway more than 3,140 metres long; an extension of 60-70 metres is advisable for safety. Moreover, taxiways must be expanded for added parking capacity. More specifically, a full extension of parallel taxiways and a minimum of two rapid exit taxiways would help tremendously… when you're dealing with 32 aircraft an hour [like in late-August for The Venetian's opening], it is taxing and vexing in the extreme!" He suggests that the problem is sluggish local planning. "It takes up to two years to plan here… it is not feasible to have a policy and no implementation capability". If Angeja's prescriptions seem stark: They are. To him the SAR must "catch up because there are four decent airports in a 60-mile radius of Macau – Hong Kong, Zhuhai, Guangzhou and Shenzhen".
On a more positive note, Woods' assessment is Macau is doing the best given its relative size. He indicates that there are two paradigms in airport economics: "the 'origin and destination' [Macau] approach and the 'hub-and-spoke' [Hong Kong] model". In his view, Macau might become a hub but it is not critical that it become one because "there are airports in some cities that are never destined to have many connections though they have a lot of inbound travel, like Las Vegas. Sometimes the sheer volume of people coming in compensates for the dearth in variety [of destinations]". The analogy of Las Vegas certainly seems to ring true for Macau with throngs of eager visitors lining up to visit daily. "It is what it is," says Woods, adding "maybe the situational realities sometimes prohibit a 'hub-and-spoke' model which would be much more intrusive… Macau will certainly never rival Hong Kong in that regard!"

Policy and planning

Policymakers should heed Angeja's advice: "We need aviation planning at least five years ahead", contending "This airport can be a pearl in the delta!" Concluding that "we [ANA] can do a quality job with 238 employees while meeting global standards of consistent service, hygiene and safety; it's not just about spending more money – we need planning, transparency of policymaking and most importantly, execution!" Prudent advice from an aviator and administrator who keeps the skies of Macau friendly and incident free.

by Ajay Shamdasani