PPRuNe Forums - View Single Post - Airports long term finacing problems
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Old 22nd Aug 2017, 08:22
  #17 (permalink)  
M-JCS
 
Join Date: May 2008
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The problem begins when airports (and airlines) think about passenger numbers rather than profitability. A LCC goes to an airport and says "we can triple your passenger numbers, but we're not going to pay you a penny because of the additional footfall we create and retails profit you can thrive on." The LCC CEO will be a hero for bringing on board another destination (even if that means one flight each week) and bigger passenger numbers. The airport manager figures triple passenger numbers is going to make him a real hero in his employer's eyes, and is enthused. Problem? The airport facilities need to be expanded in order to accommodate triple passenger numbers and larger aircraft. So funding is called in --- at a price, it must be said ---- and now the airport is faced with lower revenues per passenger from the carrier as well as the cost of finance and higher overhead. Who covers the revenue requirements? You guessed it, it's Joe Dokes walking through the door. So long as everyone is convinced a flight across the globe in the equivalent of a sardine can for the price of a ticket on a carnival ride is a good thing, the business infrastructure provided by regional airports and regional operators will continue to deteriorate.
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