Dancing to the recessionary beat

Airports are not immune from the global economic downturn. Indeed, as Olivier Jankovec, Director General of the Airports Council International (ACI), said earlier this month, “Make no mistake, 2009 will be an annus horribilis for airports traffic wise.” But as James Gordon has discovered, increasing numbers of airports are finding creative new ways to raise revenue and weather the recessionary storm.

His gloomy prophecy is already proving accurate. Just witness the proposed sale of Gatwick Airport. The airport operator, BAA, slapped a £1.8 billion (US$2.91 billion) price tag on Gatwick, when it put it up for sale in September last year. In boom times, the facility, which is London’s second largest airport, would have been snapped up, but with the recession grinding-on, that valuation is proving too high to justify. Already three of the six original bidders have pulled out.

Airport job losses

Airport workers are bearing the brunt of the downturn across the Irish Sea at Dublin Airport, where airport management last week cut over 1,000 jobs in response to the economic downturn. In Scotland, Prestwick’s Airport’s chief executive announced that the facility is to cut 120 jobs in the next few weeks. And officials at Manchester Airport say 300 baggage handlers will be made redundant in March.

So what’s the solution? How can airports best weather the financial storms that currently batter the world economy? Some commentators have observed that people are often at their most creative during recessionary times, and a number of airports, particularly in the USA, are adopting innovative strategies to raise revenues and bring back the passengers.

Take BWI-Marshall Airport in Baltimore. It’s quite literally gambling on its future. When airport bosses saw that the tendering process to install five slot machine parlours in the neighbouring state of Maryland, had all but fallen apart, airport chiefs moved quickly to get the 3,000 slot machines placed at the airport. While the plan faces obstacles – a bill must be passed before the airport will be allowed to offer gambling facilities at the airport – the slot machines could be up and running by April 2011, bringing in millions of dollars each year to the Baltimore facility.

Stepping on the gas

Elsewhere, officials from Pittsburgh International Airport are looking for additional opportunities to raise revenues after the facility recorded a 10.4% drop in passenger numbers in July compared to the same month last year. Officials hope to generate millions of dollars by tapping into natural gas reserves buried under the ground. The Allegheny County Airport Authority (ACCA) wants to set aside more than 3,460 hectares (9,000 acres) of land for gas exploration.

Airport bosses claim that if the scheme proves successful, they may in time be able to reduce landing fees, increase flights at the airport, and even attract new airlines.

Pittsburgh will not be the first airport to take such an approach. Dallas Forth Worth Airport (DFW) in Texas has already given over 7,300 hectares (18,000 hectares) of land to gas exploration. John Terrel, the vice president of commercial development at DFW, claims the facility has generated US$186 million in revenue from selling off its natural gas deposits.

“Being able to find and capture natural gas on DFW is like finding money on the ground,” says Terrel.

Where natural gas isn’t in plentiful supply, airport managers have to employ more innovative revenue making schemes to attract passengers to their facilities. Take Betsey Sanpere – she’s using American art to entice passengers to US airports.

Artistic contribution

Sanpere set up an aviation consultancy, Creative Airport Solutions, five years ago. The firm specialises in cost-effective initiatives that include planning and implementing arts programmes. Sanpere spends much of her time on the road, showcasing US art in US terminal buildings, and she claims that airports and artists are profiting from exhibiting airport art displays. Her company recently was part of the CitiArts Team, a Charlotte, NC and Baltimore-based company, that completed the Arts and Archives Master Plan for the Metropolitan Washington Airports Authority (KDCA and KIAD).

As an example of what can be done, the Airport Foundation at Minneapolis-St.Paul International Airport (KMSP) allows professional musicians to perform at approved locations and sell CD’s to the traveling public. “A percentage of their sales are paid to the Airport Foundation which, in turn, uses the proceeds to pay per diems to non-professional musicians and school groups. Approximately, US$20,000 per year is raised this way according to the director of the foundation," says Sanpere.

At Redmond Municipal Airport-Roberts Field in Oregon the airport established art shows to promote local artists and to raise revenue. There are three rotating exhibits per year, with the artists agreeing to pay the Airport a 40% commission on any work sold. From 1993 to 1996 the airport raised almost US$200,000 from sales of art to passengers and visitors. In a similar programme, Nantucket Memorial Airport, preparing for the opening of their new terminal, displays artwork valued at up to US$15,000 and takes a 15% commission from sales of work created by local artists.

Dance away the heartache

And there is evidence that some European Airports are beginning to catch on. Last year Paris Charles de Gaulle Airport took advantage of the passenger ‘dwell time’ by teaching 6,000 passengers to dance (pictured). The lessons, which will continue this summer, take place in the boarding lounges, and last 15 minutes.

“Our dance lessons are fun, and addressed to the whole family. Holidays start at the airport,” says Audrey a dance teacher at the airport.

But perhaps the most important lesson for airports is adopting a willingness to be innovative. By tapping into less traditional revenue raising schemes, airport officials can avoid the worst ravages of the recession and spread a little fun in the process.

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