How do Airports Charge for use of Their Facilities

[Jemy]

I'm looking into how airports charge of the use of their facilities in the UK. In particular BAA.
Do airports charge airlines a fee based on the landing weight of the aircraft or per passenger it processes?
Does anybody have any idea of how much landing or passenger handling fees are?
I'm trying to get some figures so that I can demonstrate how unjustified it is for those who require to be collected by car at an airport to have their friends or relatives pay for a short stay in the pick up car park. I hope to write to my MP about this issue as I feel that BAA and NCP are extracting enough revenue from the travelling public.
It seems to me if transport, environment, airport and security come together in the same sentence then some commercial outfits see an excuse to extort money from the travelling public and quite frankly I'm fed up with it as it's going to kill this industry.
On the continent at many airports you can park for free for up to 2 hours which is very generous. 30 mins would be sufficient for most people.
Any information gratefully received.

[Capt Wannabe]

BAA

Try http://www.baa.com/cou

[4 engines 4 longhaul]

heres the prospective from a smaller airport:-

http://info.cwlfly.com/en/content/4/...d-charges.html

[Jemy]

Spot on! Thank you. Now for a bit of reading............
Cheers

[danieloakworth]

I can see your point where the big BAA airports are concerned, infact anybody who can afford to use NATS can't be short of a few quid. However, spare a thought for the smaller outfits who are trying to turn a penny in todays environment. The cost of running an airport whilst addressing the many external influences (SES requirements, wind farm applications, environmental pressure etc etc ) gets steeper every year. Add to this the move towards paying Low Cost operators to use you airport and you can understand why so many have to take revenue where they can get it.

I sympathise with the point, but while it's fine to refer to overseas airports let's remember that they also have their own little revenue earners (Airport Development Fee anybody?)

[Momentary Lapse]

So why would an airport operator tarmac over valuable land except to earn an income from it? Barriers, ticket machines, cameras, trolley parks, security etc. all cost money as well as the tarmac. Airport operators are not charities you know. As it is, they have to make all this investment without any guarantee the airlines will ever turn up, or stick around for long before being seduced by some other airport.

If there's no return from developing the land as parking, why bother? Just concrete it and put planes on it instead.

"No car park? Sorry sir, no-one wanted to pay for it."

[h73kr]

I'm flying from Norwich 'International' (i.e. small) Airport tomorrow. I have just seen on their website I am required to pay a newly introduced £3 'Airport Development Charge'! This is so this privately owned company can get it's passengers to pay for it's further expansion. A short and not very nice word springs to mind! I wonder at the legality of asking a paying passenger to pay a contribution to the viability of a develoment in the future?! and apparently if I don't pay, I won;t be allowed to use their service (i.e. board the flight I have paid for!!!!!!!) Any advice on avoiding this new policy from Norwich 'Dick Turpin' Airport would be appreciated.

[danieloakworth]

I wondered who would pick up on Norwich first, to be fair they got the idea from Newquay. From an Ops perspective I can see significant benefit, the Norwich money for example has gone straight into a pot to allow for replacement of legacy equipment and the meeting of the many new and varied regulatory requirements. I guess they could have upped their landing fees and nobody would have been any the wiser. I admire them for the approach, at least this way you know the money is going to keep the facility you fly from safe rather than at the bare minimum acceptable to CAA. It's not that unusual, it's fairly common practice at many holiday type destinations.

[h73kr]

yeah, I think it's a very fair idea...great principle.

'Morning Sir, how may we help you?'

'Well, I paid for a TV on your website for £250, I'm just here to pick it up as arranged?'

'Of course Sir, it's in Electricals on the second floor'

'Great, I'll nip up and get it'

'Not so fast Sir, we plan to upgrade the escalators and add an extension in maybe possibly perhaps five years time, you'll need to pay a £5 fee to cover this'.

Shove it!

[danieloakworth]

Any advice on avoiding this new policy from Norwich 'Dick Turpin' Airport would be appreciated.

You're a customer. If £3 (and £1 per child) is really that important to you then fly from somewhere else. Personally, and knowing how strapped for cash many of the smaller regionals are, I applaud Norwich for having the balls to stick their head above the parapet and introduce Airport Development Fee. If you look at the increased requirements placed on these guys in the last 18 months you might understand why they are struggling.

If you take wind farms as an example, the Govt think it's a great idea and are very supportive of the very many (and growing) wind energy companies. If you take a look at a map of the proposed farms across the UK you'd be amazed at how many are in extremely close proximity to airports and their approaches. Now some energy companies are pretty good when it comes to finding suitable mitigation and some can't wait to bring the lawyers in and go to Public Enquiry. Either way it costs the airports huge amounts of money each year just to maintain the status quo (infact they don't because they're fighting a losing battle). As a direct example Norwich are currently involed in a public enquiry, which will no doubt cost them £.5 M when all is said and done. The money has to come from somewhere and this is invariably reflected in a reduction in safety enhancements, keeping the airport at the minimum level acceptable to CAA. The ADF is another bloody tax, but I for one am pleased Norwich have done it and would be more concerned about the ones who haven't.

[west lakes]

Now some energy companies are pretty good when it comes to finding suitable mitigation and some can't wait to bring the lawyers in and go to Public Enquiry.

though off thread it is worth knowing.
Planning laws are designed that if the generation capacity of a proposed windfarm is above a certain level the local authority cannot make a decision on an application - it has to go to an enquiry! So guess what operators are always looking to be above that figure.
It keeps the locals out of the frame better

[garethjk22]

The TV in the shop analogy doesn't really work does it?

If you said, hi, I've just paid a company on the web £250 for a TV, and they are storing them in your shop. They are also probably not paying you anywhere near what it costs you to store them in your shop, on the basis that you will get lots of people to walk through the door. So, can I collect it?

Answer, yes of course you can, but unfortunatly even though the company you paid for the TV is making a profit, we are not, so we need you to buy a cup of coffee, pay £1 in the car park, hopefully you will also buy a bottle of smellies and some booze so that we can stand a hope of covering the cost of the electric bill this month ....

It's much more complicated and indepth than simply the reading the published fees and charges which in 95% of cases bear no resemblence at all to what the airline actually pays.

[danieloakworth]

So guess what operators are always looking to be above that figure. It keeps the locals out of the frame better

The whole process is a mess, and it's not helped by those who've made a good living out of ATC/Airports who are very quick to turn round and sell their souls to the wind energy companies in order to undermine legitimate concerns surrounding the impact of turbines on an airports PSR.

In fairness to the energy companies though, at least the enquiry get's round NIMBY policies like 'no wind farms in Northumberland'.

[tribekey]

i want a cheap airline ticket. i don't want to pay to park. i don't want to pay for anything....blah, blah,blah.


Jemy, sit back and try to figure out where all the money to run those nice shiny aircraft and nice new regional airports has to come from. Cheapy airlines often pay very little or even nothing to the airports in the way of landing fees etc. Consequently the airports have no choice but to make their money by extracting car park charges,hefty meal prices etc.

[Jemy]

Thanks for the response from my initial post! Nice to stimulate a debate.
Regarding the car parking fee, please consider the following. (Thanks to Capt Wannabe for the Link!)
For 30 minutes in the short stay car park at Glasgow you are charged £2.40
Please consider that a family of 4 on it’s annual holiday will contribute £43.60 to BAA as a passenger fee (£10.90 each); nevermind the money they will spend shopping and eating in the various outlets within the BAA terminal. Often such families cannot travel to and from the airport via public transport as charter flights arrive and depart in the small hours . Also going on a service bus is no fun with 2 tired kids, suitcases buggys etc. You can see why they would elect to be collected by a relative. To then be charged to just collect such a family is just not on. They have already paid to use the airport facilities, surely this must include being collected in a civilised manner.
Having studied a bit of economics, I fully understand the principles of monopolistic behaviour and how it can negatively influence economic efficiency. BAA and NCP, in my mind, are behaving in a monopolistic way. Many travellers have no choice and need to be collected. (My poor old elderly aunt springs to mind) To be forced to pay to be collected when you have already paid to use the airport is wrong.
If BAA and NCP were not charge for 30 mins to an hour in the short stay car park, then they may find that more people, when dropping off or collecting someone will come into the airport, spend a bit of cash and enjoy the experience of the airport.
I fully understand that BAA and NCP are profit making organisations, but wouldn’t it be good not to have to pay and have to rush around?
Regarding the airport improvement tax at Norwich, maybe we should wait and see. I did a wet lease on the 757 out of Vancouver a few years ago. Yancouver have an airport improvemant tax and boy what an airport! The scheme is transparent so you can trace where the revenue goes and they have a great, world class facility. (And free parking for 30 mins!). Maybe if the Norwich scheme is transparent and accountable Norfolk will have an airport to be proud of….
Your thoughts please............

[danieloakworth]

Jemy,

agree with your sentiments. It would be interesting to see an experiment trading off car parking fees against terminal revenue (although I'm sure a lot of this has more to do with Service Level Agreements between the airports and NCP). I like the Norwich idea, it's been done for all the right reasons, I hope others follow suit.

[afterdark]

BAA Glasgow are ripping it though.... any private car/taxi that has came to pick up someone that is standing waiting, may not stop/or pick them up even if they are dropping another person at the same place, unless you use a car park at a cost, whether you get them or not.

whoever thought of this idea is an idiot.

[Jemy]

Afterdark, you are quite correct. I sometimes arrange to be collected by hackney cab at Glasgow as it costs TWICE as much to get home in a licensed airport cab. The pre booked taxis, rather than pay £2.40 to await their fare either drive round the airport roads in circles until their fare spots them by the short stay car park, or they park illegally just outside the entrance of the car park blocking it. Both of these activities cause MORE congestion at the front of the terminal, exactly the opposite to what BAA claim the new collection procedure should achieve.

Why not have 30 mins free for everyone and make the whole business of using the airport more user friendly and pleasant. I think the traffic wardens and police would welcome this as they wouldn't have to move on so many vehicles from the airport roadways.

[Woofrey]

Jemy, it seems that your gripe is more to do with being charged for car parking than anything else, however as you have expressed an interest in how BAA charge for their facilities, you first need to understand the regulatory environment that they operate within ( for the South East airports anyway ), which as you have read about Economics, I trust you do.
But if you haven't, it operates something like this :
1. BAA are allowed a rate of return on their asset base.
2. One of the considerations in determining the asset base is traffic volumes and capacity required, hence capital spend forecasts to accomodate pax growth and facilities required.
3. You can now work out the allowed return, e.g. if the allowed return is 5%, and the asset base is £1 bn, then the allowed return is £50m.
4. In computing how the £50m is acheived, they calculate how much it costs to run the airport, ( say £200m ) and then the likely income from activities other than traffic charges, ( say £150m ) to leave the balance to come from airport charges, in this case £100m.
5. You then divide the airport charges income by the number of passengers to get the yield per pax. ( The yield is then acheived through a combination of landing fees, parking fees and departing passenger charges ).
That of course is a very simplistic summary, and there is a whole industry involved in regulating and reviewing all of this, involving the CAA, BAA and airlines themselves, looking at everything from forecast pax numbers, facilities required, rates of return and financial forecasts.
You will see however, that if you wish to have free car parking, the income from non aeronautical sources will drop, in which case traffic charges will rise in order to balance the allowed return. This is how the retail income subsidises the airport charges.
I'm not advocating the rights and wrongs of this regulatory model, just setting out how it currently operates. You will find loads more on this, and the current review, in the CAA site on Economic Regulation.
I trust this is helpful.

[Momentary Lapse]

Well explained Woofrey.

£43.60 doesn't buy much concrete.

Meeters and greeters don't spend much money at airports, yet they take up a huge amount of room. Walk around any arrivals hall and watch them. They stand there gawping at the monitors waving their crappy bits of paper. They don't browse the shops or relax with a coffee.

That's why airports don't spend much on looking after their arrivals halls: there's no retail spend there to pay for it.