Airport Transfers Innovations
Today, the airport ground transportation industry is confronted with technology innovations and the disruptions they can cause. Three key innovations that are disrupting market share of traditional ground transportation modes like taxis, hotel shuttle buses, and personal vehicles are (1) ride-hailing services (also called Transportation Network Companies, or TNCs), (2) dedicated rail transport systems, and (3) electric and autonomous vehicles.
Increased Use of Ride-Hailing Services
- Ride-hailing services like Uber and Lyft are replacing personal cars and car rentals as passengers' preferred methods to travel to and from airports. These services are preferred by millennials (those people born between 1982 and 2000), who would rather not own their own cars and who have become a substantial segment of the air travel market.
- The Uber and Lyft vehicles can clog curbside passenger departure and arrival roads, creating big traffic jams and annoying air travelers and their families and business associates. But some airports have already accepted this innovation and have redesigned or repurposed areas of their airports to accommodate the TNCs. Other airports are working on making Uber, Lyft, and other ride-hailing services welcome. For example, Atlanta's Hartsfield-Jackson airport and Denver's international airport "are embracing ride-sharing into their terminal-area development plans to facilitate smooth multi-modal alternative mobility."
- In addition, the use of ride-hailing services directly contributes to the reduction of airport income. This problem alone could make TNCs a key disrupter of traditional ground transportation. In the U.S., ground transportation services and parking fees make up 41% of airport revenues.
- TNC usage also affects how airports use their land. Airports are cutting back on parking spaces that are no longer needed because travelers aren't bringing their personal cars to the airport and leaving them there while on their trips. For example, "Pittsburgh International Airport is embarking on a $1 billion facility improvement program, which initially included the construction of about 5,000 additional parking spaces. After a more thorough review, however, the airport decided to scale back to 3,500 spaces because of the increasing use of TNCs."
- In the past, "ground transport options [were] a driver of infrastructure investment, requiring parking facilities, access roads and curbside pickup/drop-off areas. These assets are capital intensive and have long life spans, which puts them at risk of disruption from changes in passenger behavior and mobility trends." Asset removal and replacement is costly and disruptive to customers who use the airport as well as to vendors that serve the customers on site.
Dedicated Rail Transport Systems
- Successful rail transport systems like those in Europe have helped some U.S. airports adapt to travelers' ground transportation needs. Additional rail systems could be incorporated into airport ground transportation services at airports that currently do not have them.
- In the year 2000, 16 large U.S. airports did not have dedicated rail systems." Today, many U.S. airports do have rail service. Miami, Philadelphia, Providence, Milwaukee, and Denver have added dedicated rail service to their ground transportation options. Atlanta, Baltimore-Washington, Cleveland, Chicago, Dallas-Fort Worth, Minneapolis, Oakland, Phoenix, Portland, San Francisco, Seattle-Tacoma, St Louis, and Dulles International now have stops at the airport on their new or existing light-rail or rapid-transit systems.
- Dedicated rail systems and light-rail or rapid-transit stops at airports can reduce traffic congestion and reduce fossil fuel emissions of internal combustion engines from cars NOT driven to and from airports. But using rail transportation also reduces airport revenues from parking and traditional ground transportation methods.
Electric and Autonomous Vehicles
- The near future will see further development and market penetration of electric and autonomous vehicles used as ground transportation to and from airports.
- Major companies like Waymo and Tesla have already done extensive testing of their vehicles and will be implementing their services soon.
- The introduction of autonomous vehicles (AVs) will further complicate the ride-hailing segment of ground transportation, since the AVs will be summoned by a phone app. Airport logistics managers will be required to address traffic congestion, curb space, concession pricing, and other factors.
- The AVs may also reduce airport revenues, unless negotiations can produce agreements to share AV revenues in return for curbside accommodation.