Small and Large Airport Concession Agreements March 2013

Small and Large Airport Concession Agreements March 2013

Shared Ride at airports § Is inherently green, and……….

It’s not easy being green!!

Shared Ride at airports § § § Is inherently green Is an after thought (taxi’s, mass transit) Can take up to 6 cars off the road Removes private cars from traffic flow Reduces emissions Improves air quality

Shared Ride at airports § Is non subsidized mass transit!!! § Lower price point……. § But goes door to door

Common for all airports § Financial health Be able to make investments Insurance State minimum is not enough Safety Comprehensive plan Experience Technology Dispatch and rez

Small Airports § Exclusive – Too Small of a market to be financially healthy • Nashville experience – – – Provide an airport office to cut overhead Waiting area to build loads/ age the passenger. Curb space is minimum Minimum signage…… But good location (not the back 40)

Nashville case study § 4 providers – One primarily military – Two to city areas – One convention hotel that provides the service • The hotel has a ticket counter as you get to baggage claim • Other 3 share a booth causing commodity pricing

Nashville § Nashville O&D 4. 7 million § Ridership was primarily hotel/convention traffic § Average fare was approximately $17 § SS used vans, competitor used Sprinters § No one company had high density

Nashville § Open transportation market § Over 90 providers § City attempted to pass an ordinance to limit that number

Nashville § At the same time airport was asked to put out an exclusive RFP § Airport would put out a RFP for door to door residential only – too small of a market § One carrier pulls out, one looks to sell citing losses

Nashville § No RFP ever put out § However, the transportation ordinance passed!

Large Airports § Multiple carriers without flooding the market – LA had 3, seems 2 is optimal – SF going through this process now – Usually many competitors (taxi, black car, private bus, city bus etc)

Large Airports § Maximum signage – ORD § Adequate curb space (multiple vans) § Curb or airport staff (or both) § Technology – Kiosks – Boarding signs

Orlando case study § 13 th largest airport-35 million passengers § Great transportation market – Largest rental car market § § One dominant provider Underserved residential market MCO wants second provider to be DBE Prior 2 DBE’s went out of business

Orlando § Will not give a second contract to non DBE company § SS starts service using a reservations only system § Rides are matched remotely and communicated to passengers § Service to all areas

Orlando § Super. Shuttle carries approximately 15, 000 passengers per month § Approximately 3 passengers per trip § 50% go to residential areas § All prepaid, pre arranged § Not paying concession fee to MCO § Only need is for curb space for staging and walk up business

A word on concession fees § The spirit of partnership – Both parties share in success – Structure fee, “the better I do the better you do” – Fees should vary by market and market density – How much market protection does the airport really offer these days?

Summary § Even though shared ride is sometimes overlooked as an important part of airport transportation solutions, as you know, it is green, it eases congestion, it is nonsubsidized mass transit and can be a good source of revenue for airports.