Industry Outlook

Industry Outlook Airport capacity, funding issues rank high for airports; airport-based businesses see rising costs of operating BY Monica L. Rausch, Associate Editor June 1999 Q: How has the 6-month limited FAA reauthorization...


Industry Outlook

Airport capacity, funding issues rank high for airports; airport-based businesses see rising costs of operating

BY Monica L. Rausch, Associate Editor

June 1999

Be careful what one wishes for...that's what airports are learning. An increase in flights may bring more revenue, but future airport capacity is the top concern managers reported in a survey by AIRPORT BUSINESS.

To handle this increase, airports need a steady source of funding to build the needed infrastructure, and unfortunately Congress and FAA are still debating that one.

For airport-based businesses, the rising costs of doing business — insurance costs, fuel, taxes, and the possibility of user fees — seem to be on most managers' minds. Next are problems in finding and keeping staff, most notably, flight instructors and technicians, and issues with government regulations.

Here's more of what we uncovered in this year's survey.

AIRPORTS
The projected median number of operations for 1998 in last year's survey was 30,000, but the actual number reported in this year's survey was 48,000, revealing unpredicted growth. Still, managers have a conservative projected median of 45,000 operations for 1999.

To meet capacity needs, some 52 percent of airports report planning runway projects during the next year, and 26 percent will be working on terminal construction. Sixteen percent are planning construction/renovation for retail purposes.

In estimated capital funding needs for the next 5 years, respondents surveyed tallied a median of $4 million. The U.S. General Accounting Office recently released a report stating that the current annual funding for airports is some $3 billion short of planned development costs.

As for millennium issues, the majority of airports — 95 percent — say their facility will be Y2K compliant by the year 2000. Some 73 percent say they a have a formal Y2K compliance program.

Airport-based businesses
Of the airport-based businesses that responded to our survey, 66 percent were based on general aviation airports. Just under one third purchased aircraft in 1998. Another 41 percent plan to buy one or more aircraft in 1999.

Some 85 percent of airport business managers have access to the Internet; just under one-third offer Internet and e-mail services to customers. Two-thirds of the respondents have a Y2K compliancy program, and 94 percent say they will be ready for the year 2000.

We Recommend

  • News

    Surveys Won't Save Worcester Airport

    While it is hard to sort out how the DOT money or the funds allocated for consultants, is being spent, this much is clear: No new commercial air service has resulted yet from any of those endeavors.

  • Article

    Lift Is Not the Issue

    L ift is not the issue More planes bring growth; keeping the airspace, infrastructure in step is the challenge By John F. Infanger, Editorial Director June 2001 The state of the...

  • Article

    Industry News

    News, Briefings, Calender, and FBO Snapshots

  • Article

    ACI-NA 1999 Priorities

    ACI_NA 1999 Priorities Topping the list is working to create a less regulated, more business-oriented environment for airports, says David Plavin BY John F. Infanger, editorial director...