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airport capacity, slot time allocation, slot pricing, disincentive strategy, slot auction
Indonesian airports have been experiencing significant air traffic growth and are unable to cope with the increasing air passenger demand. There is an urgent need for an effective slot allocation strategy to manage the demand for airport capacity. This paper conducts a case study to examine the possibility of managing slot time allocation to maximize runways capacity by analyzing disincentive strategy in balancing the usage of runways with Capacity Restraint and Demand Balanced approach. The research found that airlines willing to use slot time at the most demanded time interval should pay an additional 6.57% (CR approach) from total revenue gained by the government from slot sector and 6.55% (DB approach). The additional cost for less demanded slot time interval is only 0.09% (in both CR and DB approaches). Findings from this study should be considered as an initial step toward educating policy makers and airport authorities with the aims to creating better mechanism in Indonesia’s airspace market.