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Many airports are missing out on maximizing their revenue from on-site parking and rental car operations, says a top Chicago O'Hare Airport official.
O'Hare, the busiest airport in the United States, has discovered some novel approaches to squeeze additional revenue from such services to help fund an $80 million rehabilitation of its parking facilities, says Jack Hartman, O'Hare's deputy commissioner of landside and terminal operations.
Hartman shared his views during a panel discussion nearly 100 airport administrators and consultants at the conference of the Airports Council International, North America, held in San Diego Oct. 20-23.
Among the top 25 U.S. airports, parking and rental car revenues composed 13.4% and 6.3% of total airport revenues, respectively, according to a study by the council. At medium-sized airports, the importance of these revenue sources is heightened because they encompass even greater shares of the total revenue. Parking contributes 25% and rental cars 11.7%, respectively, of total revenues at those airports, the survey found.
Len Ginn, the council's senior vice president of economic and associate affairs, says the role of airports has expanded from merely offering transportation to generating trade, local economic activity and concession revenues.
Victoria Pannell, the council's vice president of public affairs, says, "There weren't a lot of funding problems for airports in the '60s. Since deregulation, airports have needed to become much more competitive in revenue-generating activities."
And they can be if managers understand that many airport patrons are busy, high income people who are willing to spend money. Airports should respond accordingly, O'Hare has proved....Hike Parking Fees, O'Hare Official Says O'Hare has found airport passengers and greeters are willing to pay higher parking fees, Hartman says.
One method O'Hare successfully adopted was to hike fees charged for the first two hours of parking. This approach, begun in 1994, boosted revenues collected from "meeters and greeters," who generally account for between 30-60% of the people who park at airports, Hartman adds.
Airports that offer the...