RobertS975
Topic Author
Posts: 759
Joined: Sun Aug 14, 2005 2:17 am

Airlines Missing The Best Part Of The Business

Fri Jan 06, 2006 12:51 am

I know, strange topic title... we are all aware how many of the world's airlines are currently struggling and indeed, how they have struggled historically. By and large, the airline business has not been a good place to invest your money. But other elements of the commercial aviation infrastructure, alike airports and airport concessionaires, are making good money... basically off of the passengers provided to them by the airlines.

If not for the airlines providing seats for passengers, there would not be anyone paying $25 a day to park at the airports. There would be nobody at the airport shops, restaurants and bars. We wouldn't be filling our airport hotels etc. There is a huge infrastructure making decent money off of the airlines even if the airlines cannot make much money flying people around.

Why didn't the airlines figure out a long time ago that they should be getting a cut of the revenue from all that infrastructure? A small percentage of the parking revenue, the duty free shop revenues, even airport hotel revenues.
Without the airline passenger, none of the business infrastructure that caters to the airline passengers would make money. Instead, airports charge the airlines rent and landing fees. It should be the other way around!

Radical notions perhaps... let's discuss it.
 
Gr8Circle
Posts: 2387
Joined: Fri Dec 02, 2005 11:44 am

RE: Airlines Missing The Best Part Of The Business

Fri Jan 06, 2006 1:00 am

Quoting RobertS975 (Thread starter):
Why didn't the airlines figure out a long time ago that they should be getting a cut of the revenue from all that infrastructure?

Don't really agree with that....they all complement each other....moreover, if airlines thought on these lines, they would have got into providing these services themselves - sort of as business diversification....sensible thing for them to do is concentrate on their core business of flying pax from pt A to pt B....

I understand that some airline did over the years, have hotel chains as a logical extension....wonder how many of them are still in that business?....
 
JRadier
Posts: 3943
Joined: Mon Sep 27, 2004 11:36 pm

RE: Airlines Missing The Best Part Of The Business

Fri Jan 06, 2006 1:01 am

The airports make money on things like parking, shops etc. They pay (in part) for the terminal, the way it looks, expansion and things like that. This makes operating the airport 'cheaper' thus the charges to the airline can be lower. If part of these revenues would go (partly) go to the airlines there would be less money for operating the airport, so the charges for airlines have to be higher. It makes no sense.
For once you have tasted flight you will walk the earth with your eyes turned skywards, for there you have been and ther
 
RobertS975
Topic Author
Posts: 759
Joined: Sun Aug 14, 2005 2:17 am

RE: Airlines Missing The Best Part Of The Business

Fri Jan 06, 2006 1:06 am

Because without healthy airlines, there might be no business for the anyone. This especially applies for a connection hub where even more of the business is generated by the airline, not local O/D passengers.