By Brett Bain
Historically, things in airports around parking and transportation have until the last few years, been static. Customers generally followed three standard options for getting to the airport. They drove themselves and parked their vehicle at the airport, they took a taxi or limousine, or they were dropped off by a friend or family member.
Airports in Canada – in most cases – are non-profit organizations that operate under a lease arrangement with the federal government. They do not receive any funding from the government to operate and in fact, pay a minimum of 10% of gross revenues in tax back to the federal government. In addition, they are also required to pay property tax to the jurisdiction in which they reside. As a result, Canadian airports are very reliant on the revenue generated from non-aviation sources which consists primarily of parking, concessions within the airport and real estate revenues. These revenues are reinvested back into the airport for operational expenses and for airport infrastructure and flight development.
Like many businesses, airports have been in transition over the last few years. If we think back a bit, we can all remember that at one time telephone, internet and cable companies were all separate entities which provided a product or service to their customers. These businesses have all blended together into single entities over the last few years as technology has created opportunities for companies to enter into new markets. Parking and transportation at airports are now in the early stages of a similar transformation as transit and/or rail services begin to appear in the airport offerings. Airports are both an economic driver for their region and a reflection of the community which they serve. As cities develop new and expanded forms of transportation to serve their citizens, these are also reflected in their airports.
So, what is the link between parking and transportation for airports? As cities have increased their development of public transportation, airports have seen the same development. Most larger airports in the country have added public transit bus services in the last few years to connect their city with the airport. These bus transit services are in some cases supplemented by on site airport transit to help connect one service to another to serve their passengers. Larger airports like Toronto and Vancouver are also serviced by light rail and many other cities are either developing or planning to develop rail services to their airport in the future.
Most recently, services like Uber, TappCar and Lyft have begun airport services. These new transportation options represent a shift in how customers get to and from their airports. Taxi services have generally seen a reduction in their market share and demand as a result. Ride sharing services also represent a threat to the parking revenue streams which airports are reliant on to survive. In more established markets in the United States, some airports have seen significant reductions in their revenue streams from parking.
Given the differences between the Canadian and US airport models, future changes will be required if airports are to survive. Like other industries, it is conceivable that public transit, ride sharing services and parking will see some type of amalgamation in the future. Ideas like first mile and last mile with ride sharing converging with transit is under consideration in many cities. Perhaps in the future, not all parking customers at the airport will be travelling somewhere but rather parking their vehicles at the airport to connect to different forms of transportation. And what about autonomous vehicles? How will this effect both transportation and airports? It’s too early to tell, however both airports and cities are in the planning stages to develop infrastructure to support the largest innovation in transportation since the invention of the automobile.