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Changi Airport Case Study

1489 Words6 Pages

The purpose of this assignment is learn about the commercialisation in the airport industry and further understanding on the corporatisation of Changi Airport. In this report is a case study of Changi Airport which was corporatized after being established over 28 years in order to remain competitive in this trade. Upon corporatisation, the company was then split into two separate entitles namely Changi Airport Group (CAG) and a new Civil Aviation Authority of Singapore. (CAAS). I will talk about how the differences in Corporatisation and Privatisation can bring certain impacts to the company and different categories of people. Corporatisation is changing structure of a government or semi-government body to operate on business lines, mandated …show more content…

It gives the organisation ability to set employment policies. It includes having lower risks as there is high transparency in its operations for which the money the company make and spend has to be accounted. Company can work closer together with regional, national and international partners. meet to the global developments and market demands more efficiently and flexibly. Organisation has a separate legal entity as it is legally established as an independent entity leading to a more lasting transfer of control compared to under utility restructuring. There is greater management responsibility and autonomy for decisions on operations, investments, revenues and expenditures, and on commercial …show more content…

Firstly, for Singapore Government, their rights over Changi Airport have now been loosened from direct to decentralised control. Corporatisation leads to formation of Changi Airport Group (Singapore) Pte Ltd (CAG) and the restructuring of the Civil Aviation Authority of Singapore (CAAS). CAG being a private company, have complete authority over operational decisions and government cannot interfere with their structure of governing as they need not adhere to stipulations. Secondly, for CAAS, separation into CAAS and Changi Airport Group (CAG) upon Corporatisation means that the two new subsidiaries now have different functions and focus. The company might face chaotic situation as they are handling and operating differently from what they are used to before Corporatisation. The direction of the company is unclear to them and operations might be messed up. Thirdly, for airlines, the parking fee may increase because upon Corporatisation, their source of income would be more focused towards non-aeronautical charges. The company will try to cut profits from aeronautical charges in comparison with other airlines so that they can remain competitive in the market. Fourthly, for passenger, the check-in fee may increase because of the globally competitive companies who are in the same trade. Corporatisation cause an increase in standard of airports as they are more

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