Airline industry pours millions into new terminals – USA Today
I was asked my thoughts about airports spending money to improve the experience for travelers. I had mixed feelings. (Experience = good, cost = bad)
In the Trenches: Relying on Customer Service When Technology Fails – Intuit Small Business Blog
We found a quirk of Google Apps over the weekend and that meant we caused problems for a customer. We had to fall back on customer service skills to smooth things over.
Never trust technology no matter how good a company says their products are.
Like they say, to err is human, to really screw something up takes a computer.
I had this misfortune of flying through IAD earlier this month. The terminals there were….. dreadful would be too kind of a word.
The terminals I was in (A/C/D) all just need replaced. Sooner rather than later. Declare a superfund project or something.
Even after the latest round of upgrades in the United terminals at IAD, that place still feels like a basement rec room to me.
Everytime I see a nicer-than-it-needs-to-be airport terminal in the USA — and that’s pretty often — I always wonder how much I’m paying for it. Do local taxpayers EVER pay for airport terminals these days? I assume it’s all PFCs added to tickets and, perhaps, landing fees. True? If so, it’s not surprising that cities build airports that are “monuments.” It makes them feel good, and if somebody else is picking up the tab, why not?
Wayne – No, local taxpayers never pay for it except in the form of higher airfares that your local government may have to pay for travel. It’s either passenger facility charges or bonds which are paid via revenue increases taken on airport.
We’re still paying for the AeroTrain system at IAD…that doesn’t go to all the terminals!
While I totally agree that the IAD concourses A, C & D need a major reconstruction to bring them to an acceptable standard, on the whole I am extremely reluctant to give any airport authority the right to collect any additional Passenger Facility Charges (PFCs).
PFCs are essentially taxes on the passengers. Airports raise revenues in so many ways – they rent space to merchants, the rent space and gates to airlines, they charge the vans (and sometimes taxis) that service the airport for hotels, parking and rental cars, they put surtaxes on car rentals, landing fees, etc.
On the whole the airport authorities ought to be able to run on a break-even basis, with their revenue sources covering their costs. Some time ago they lobbied for a fee on passenger tickets. It started out at $3/passenger, not just for originating passengers but also connecting passengers. It has since been raised to $4.50, and virtually every airport in the country collects it at the rate of $4.50.
Then they use it to fund projects that are often unnecessary or uneconomical. But if it generates some new revenue for the airport, or if it gives jobs to contractors and union members, that is often justification enough, even if it really isn’t needed for transportation. I think the airports ought to be barred from spending PFCs on anything that isn’t absolutely necessary for air travelers. Other projects should be required to pencil out on their own. That would provide some market discipline on the airport authorities… instead of building taj mahals like SJC which few airlines want to serve because it’s too expensive.
The use of the fees are limited to “FAA-approved projects that enhance safety, security, or capacity; reduce noise; or increase air carrier competition.” Plus you miss the whole fact that in hub situations the main carrier can and will shift traffic if the costs to both passengers and the airlines get too high.
Carl, how would you fund improvements to IAD? I’m not suggesting they put in a Taj Mahal, but something like the cost effective JFK T5 wouldn’t be a bad thing.
Redoing IAD is a good use of the PFCs, and they should also bond future revenues the facility will provide.
But too often these fees finance food courts and shopping malls. I’m sure they find a way to justify them as safety, security and capacity, but they are often overbuilt. By the time the bill comes due, the city has less air service, airlines have left, and the airport commission has new members.
PS: I don’t mean off-airport shopping malls, I mean retail areas in the secure part of the airport. Which might be nice to have but aren’t needed by the travelers, so they should only get built if they pencil out on their own.
AFAIK, aren’t food courts additional income for the airport? I’d guess that designers figure out the basic shell (e.g. gates here, building here, then figure out how to fit in food and retail..)