When people think of airports, the first thing that comes to mind are airplanes. Makes sense, considering that’s why these facilities were built in the first place. However, the reality is that cars and trucks outnumber airplanes by the thousands at every major airport in the world. And just as the coronavirus pandemic has upended flying, it has also fundamentally changed how airports manage the vehicles that are parked in their public and private lots. It’s not a pretty picture. The good news is that there are creative ways for airports to reimagine parking to help reduce logistical headaches and drive new sources of revenue. Historically, airport parking generated a meaningful portion of airport revenues.
Let’s start by looking at rental cars, which make up the bulk of vehicles parked at airports today. Prior to the pandemic, roughly a quarter of a million people rented cars at Los Angeles International Airport (LAX) each month. In March 2020, that number plummeted to 134,000, and in April fewer than 20,000 cars were rented — less than 10 percent of the pre-pandemic total. This collapse has been the story at just about every airport in the U.S. Given that rental cars are often picked up at airports, this means that many are currently sitting idle. Before the COVID-19 disruption, approximately 70 percent of the average airport rental car fleet was rented and therefore did not require an airport parking space. When the disruption started, all of a sudden, these cars needed a place to go. Airports were never built to handle this many parked rental cars. There just aren’t enough spaces. After all, not every car needs its own space if the majority of them are on the road at any given time. The pandemic has changed all of that.
This has created a massive problem for rental agencies, which not only have to deal with the loss of revenues but also need to scramble to find secure and affordable places to put their unused vehicles. It’s been a challenge. In the Bay Area, for example, thousands of cars that are regularly housed at San Francisco International Airport (SFO) now fill the lots at Levi’s Stadium. In other cities, rental agencies have looked at options ranging from parking at local schools, and hotel properties to renting lots in downtown business districts, which have become ghost towns thanks to COVID-19.
This kind of creativity — born out of desperation — has provided short-term solutions but it doesn’t address the bigger issue. As offices and businesses start to open up, owners of parking lots are going to need to reclaim those spaces to accommodate employees and shoppers. This is a long-term problem, not a temporary blip, and airport management professionals can’t simply wish that things will go back to normal. Rental car companies are decreasing their fleet sizes dramatically and rapidly. Additionally, traveler parking at airports isn’t going to be what it was any time soon, which is significant as the traveler paid far more for their parking than any other user at the airport.
What is needed is a radical reimagination of how airports can monetize their parking garages. That means prioritizing flexibility as a way to rebuild the new parking model since less people are traveling by air for business or leisure. One way that model can evolve is for airports to rent their traveler parking spaces to car rental companies at a discounted price. Many of these spaces have only been offered at their regular rates, which are far too expensive for companies impacted by the economic downturn. Going one step further, can large airport parking garages be used for anything else? How about the fleets of delivery vehicles that are growing to meet increasing e-commerce demands? Perhaps COVID-19 testing centers could make use of large portions of unused airport parking to meet that need. Once airports can start thinking about creating new options, like unconventional uses, then the industry can start to recover by fostering new streams of revenue.
Jeremy Zuker is the co-founder of WhereiPark, a technology company that enables multifamily residential and commercial property owners to discover new revenue sources through innovative solutions that leverage unused parking spaces.
