It is hard to believe that it has been over two years since business and personal lives have been affected, and even changed, due to COVID-19, which has caused havoc throughout the world. As a result, airports around the country and their parking operations have been on a high-speed rollercoaster as well.
Airport parking went from a growing and very profitable business in early 2020, to little or no demand and revenue for some airports for the remainder of that year and most of 2021. In 2022, there has been a steady rebound and some airports are approaching pre-pandemic passenger travel and parking demand levels.
Due to the development of vaccines and other medical treatments and procedures, there is growing evidence that passengers are returning to air travel even sooner than industry experts originally projected might take four to five years to reach. With passengers returning sooner than projected, so has parking demand at airports.
Regardless, there are a number of questions related to airport parking operations including, what have airports and their in-house parking departments or their private parking management firms learned over the last two years, how have airport parking operations changed, have passenger parking preferences and habits changed, what are some recent innovation and trends being used in airport parking operations, and will these changes be the “new normal” for airport parking when this pandemic is put in the rearview mirror?
Impact of Pandemic
First, I would like to touch on the impact of the pandemic on airport parking operations and management in high-level terms. Airport management and their in-house parking department or private parking management firms have overcome several hurdles and challenges from the last two years.
These include, but are not limited to, the following:
- Declining Parking Revenues: Airport parking fees are the number one revenue source at some airports. One can only imagine the issues and challenges this would create for all airport operations when this revenue source completely dries up even only for a brief period of time. Several airports offered temporary incentives and special rates to attract travelers. Parking demand and revenue at airports with a higher percentage of leisure travel have rebounded quicker than those with a higher percentage of business travelers. The bigger question is when will business travel get back to or exceed pre-pandemic levels?
- Contract Issues and Modifications: In many cases, private parking management firms were locked into the operational and financial terms of existing agreements and contracts, which created a heavy burden on these companies. In other cases, airports worked with their parking operator to temporarily, or permanently, modify these terms to be mutually agreeable to both parties.
- Staffing: Private parking management firms were forced to lay off or reassign thousands of parking staff at airports around the country in 2020. As air travel and parking demand continues to increase moving in 2022, the challenge now is finding and hiring enough individuals to fill the vacant positions.
- Consolidation of Services: In 2020, most airports closed all remote parking facilities requiring shuttle service to and from the terminal building to consolidate services, staffing, and reduce operating expenses by keeping only the parking lots in front of terminal buildings open for public parking. As air travel and parking demand continue to increase, these facilities have permanently opened at some airports while others are opening back up on an as needed basis.
At the peak of the pandemic in 2020, curbside valet parking operations were completely shut down due to demand as well as health and safety reasons. These services are starting back up at several airports around the country, typically the airports with higher percentages of business travelers. - Social Distancing: This pandemic health and safety requirement, although relaxed or removed, not only affected the movement and gathering of people inside terminal buildings but also airport parking operations. Parking operators were forced to revisit their operational policies and procedures for transporting parking customers to and from terminal buildings and rental car facilities on shuttle buses, elevators in parking structures, and valet parking operations.
- Reducing Operating Expenses: The pandemic created both challenges and opportunity for individuals and firms that manage airport parking operations. During the peak of the pandemic, lower parking demand and less strain on the operational needs of airport parking gave individuals and firms time to take a step back and assess. They asked How can I reduce operating expenses while maintaining a high level of customer service and convenience that my airport demands of their parking operations? Some of the challenges in the industry have been addressed in this article, but what are the opportunities?
These opportunities include, but are not limited to, the following:
• Increased use of online parking reservations
• Remote parking management services
• Cashier-less and credit card only payment options
• Touchless transactions/license plate recognition
• Parking count and guidance systems with find your car capabilities
• Electric vehicle charging stations
Innovation and Technology
The last topic of importance regarding airport parking operations includes new initiatives, innovations, and technologies in airport parking operations that airports and their parking operators have adopted due to the pandemic.
Online Parking Reservations: Some airports have seen an increased demand of travelers making online reservations for planning of their upcoming leisure and business trips. This new and higher demand is a combination of several things including the lowering of passenger stress levels the day of travel knowing a parking spot will be reserved when they arrive at the facility, quicker entrance and exit times at the facility, and a touchless transaction process that eliminates the need to interact with parking facility staff.
Remote Management Services: Also known as command center operations in the parking operations industry, some airports have transitioned into remote management of their parking facilities. With more airports incorporating credit card only payment, reducing or eliminating cashier booth attendants at exit lanes of the parking facilities, as well as taking advantage of the advancements in parking equipment and management technologies, parking operators can reduce operating expenses while providing a high-level of customer service to airport parking customers from a remote office location.
Cashier-less and Credit Card Only Payment Options: Parking operations are slowly moving towards a cashless credit card only business model similar to what the gas station industry adopted years ago. This transition is being implemented at some airports by requiring all parking fees be paid by credit card only at walkup pay-on-foot stations located inside the terminal building, near the baggage claim area, at the parking facility, or at drive up payment stations located in the exit lanes of the facility.
Touchless Transactions/License Plate Recognition: Taking advantage of proven technologies used for parking access and revenue control systems (PARCS) of parking facilities and operations, the recent pandemic has resulted in some airports implementing new customer loyalty and frequent parker programs. Other airports have expanded existing programs using license plate recognition cameras and license plate reads as the credential for ingress and egress at the entrance and exit lanes of the parking facility. Payment is instantly provided with a registered credit card. This program allows parking customers a quick, easy, and touchless transaction experience.
Parking Count and Guidance Systems with Find Your Car Capabilities: In recent years, parking count and guidance systems have become more common at airport parking facilities. They are mostly used in multi-level parking structures although technology and systems are available for installation and use in surface parking lots. Airports are realizing the multitude of benefits that systems that monitor each individual parking space and track when a space is available or occupied. They are viewed as management and customer service tools for their parking operations. This type of system can provide the following parking operation benefits:
- Reduced search times — and vehicle emissions — for customers to find an available parking space when entering a facility.
- Reduced operating expenses and the ability to increase occupancy levels to 100 percent utilization with proper sign locations that directs customers to the very last available parking space in a multi-level parking structure. Without this system, parking operators may opt to close a facility when occupancy drops below five percent of available spaces in the facility.
- Incorporating cameras for vehicle counting and monitoring. When integrated with the PARCS at the facility, the ability to create special rate parking areas/sections in the facility without the need for physical barrier and gate separations is possible.
- Ability to count and monitor vehicles using cameras, in concert with the PARCS, also provide customers the ability to find their vehicle when returning from a trip. When paying the parking fee at a pay-on-foot station or a standalone kiosk, these devices will display a map of the facility to show the customer the precise location where their vehicle is parked.
Electric Vehicle Charging Stations: In recent years to support sustainability and green initiatives, many airports around the country have added and/or increased the number of electric vehicle charging stations in their public and employee parking facilities. Several airports are also now purchasing electric shuttle busses for transporting public parkers and employees around airport property and parking facilities which creates a need for additional infrastructure to supply the power service required for these charging stations.
“Even prior to the onset of the pandemic, U.S. airports began to implement technologies to provide a touchless, contactless parking experience for their customers in an effort to improve wait times at exit while at the same time significantly reducing operating expenses,” says Robert Resier, senior vice president, east airports at SP Plus Airport Service. “The pandemic certainly expedited the need to transition to new systems utilizing bar/QR code readers to process prepaid reservations and add license plate recognition and mobile payment options that can be tied to credit card on file.”
According to Reiser, more airports are now offering online prepaid reservations providing customers with a stress-free experience while also allowing airports to develop a relationship with their customers and creating opportunities for interactive marketing and promotions.
“Online reservations are also a prelude to dynamic pricing and yield management, providing the ability and flexibility to adjust parking rates based on numerous factors including demand and length of stay aimed at capturing new customers that may be deciding to park with an off-airport competitor or getting dropped off at the airport,” says Reiser.
It is safe to say that as personal and business lives and daily routines have changed due to the pandemic in the last two years, airport parking operations are no different.
Airport parking operations and their parking operators will continue to evolve, adjust, and improve their policies and procedures to provide the highest level of customer service possible while running an efficient and customer-friendly parking operation.
David A. Moore is a senior parking consultant at Walter P Moore. He can be reached at [email protected]