Airport Business

MAY 2018

The airport professional's source for airport industry news, articles, events, and careers.

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Page 14 of 43

TECHNOLOGY Continued from previous page currently represent 41 percent of U.S. airports' commercial revenues. But, for airport operators, the car parking segment is facing new challenges. At some congested airports, there is a shift from private cars and taxis to public transport and ride-sharing operators (such as UberX and GoCar). In turn, airports may find that their car parking and ground access (public transportation and taxi) revenues become partially cannibalised – meaning lower returns for their car parking facilities. This could encourage airports to manage their car parking services and ground access yields to stimulate demand, and to create dedicated waiting areas for ride-sharing drivers – comparable to existing waiting areas for taxis. Finding opportunities amid disruption That is not to say airport operators cannot benefit from these disruptive forces: though they may need to develop strategies that balance the interests of both airlines and passengers – and cross-subsidise aeronautical and commercial revenues to a degree that maximizes their overall margins and credit quality. Although their margins are stable for now, airports will need to reinforce their competitive positions. In our view, it will be those airports with strong competitive positions (characterized by diverse airline base, full capacities, supportive regulatory frameworks and a lack of environmental or social constraints) that will soar. In the retail space, opportunities may come in areas where consumer spending growth is still holding up, such as in food and beverages and recreational services. Alternatively, opportunities may arise from preparing for – and subsequently exploiting – the next wave of disruption: electric and autonomous vehicles. Indeed, new investments will be necessary to realise the opportunities. Assisted parking technologies, for example, have the potential to increase car parks' asset utilisation, while a fleet of electric vehicle charging points may be necessary. For now, while soaring passenger numbers are still providing high flying returns for airports, operators may need to adapt their business models if they are to maintain their current levels of stable returns. ■ ABOUT THE AUTHOR Mar Beltran Mar Beltran is the senior director, infrastructure sector lead, EMEA at S&P Global Ratings. She previously worked at Australia-based Global Infrastructure Hub, where she led policy work to identify reforms in infrastructure markets. Beltran has also advised governments in both developed and emerging markets on governance, regulatory frameworks, planning and delivery of infrastructure projects. Skymark Refulers Worldwide Leader in Aircraft Refuelers Ask About Our Leasing & Rental Options May 2018 airportbusiness 15

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