VIEWS: 26 PAGES: 2 CATEGORY: Science & Technology POSTED ON: 6/13/2010
Regarding the overall airport/airline economic relationship [Bill Ayer] says, "I think it's time we rethink this relationship." He stresses that the cost per enplanement is "potentially core-critical" when an airline is considering service to a market. 'What you're really betting on is the leadership at that airport," he says.
M A N A G I N G A I R P O R T S TODAY By John F. Infanger, Editorial Director in a better position to capitalize on air James Masoero, general manager service opportunities in the future. of corporate real estate for Delta Air AIRPORTS Regarding the overall airport/airline economic relationship Ayer says, “I think it’s time we rethink this relationship.” He Lines, questions why the U.S. airport industry has accumulated some $27 billion in cash reserves, up from $21 AND ECONOMICS stresses that the cost per enplanement is “potentially core-critical” when an airline is considering service to a market. “What you’re really betting on is the leadership billion in 2001, during a period when he says cost per enplanement has risen 49 percent. [For more on this topic, see “Inside the Industry,” page 24.] Conference themes: the economy; the credit at that airport,” he says. Ed White, vice president of real Masoero offers up some specific rates and charges topics for consider- markets; and the airport/airline model estate for Alaska Airlines, adds that the particular airline/airport agreement ation by airports: • competitively bid outside con- SEATTLE — This year’s Airport Economics & Finance Conference hosted — be it residual, compensatory, or a tracting for services and use the air- hybrid — isn’t as important as how a port’s purchasing power as a tool; by Airports Council International-North America reflected the concerns specific agreement works in a particu- • review refinancing opportunities of the nation regarding an economy in recession and tight credit markets. lar market. “We need one that brings a on current debt service; Airports are focused today on reducing costs; finding new efficiencies; downward pressure on CPE,” he says. • review the airport’s cash reserves reconsidering or holding off major infrastructure projects; and rethinking White also tells airports that before and assess if adequate/justifiable; they plan infrastructure expansion • “value engineer” projects; the airline/airport economic model, which continues to evolve as the air such as a new concourse, that they • consider the potential to moth carrier industry has its ongoing struggle with making a profit. should first consider what the tenant ball facilities that are currently being airlines can afford. Then work together underutilized; Airports have been hard hit by passenger projections as a result. toward determining what’s appropri- • consider deferring any sched- the paralysis that has occurred within William Swelbar, a research engi- ate to build, says White, and not first uled rate increases to tenants; and the banking community over the past neer at the Massachusetts Institute of decide on a facility and then consider • implement landing fees for gen- six months. David Spirakis, managing Technology, says of the U.S. airline the costs to the airlines. eral aviation where feasible. director for pu
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