Airlines and airports need each other — and also hate each other
December 4, 2022
By Sabri Ben-Achour, MarketPlace
Business relationships come in many flavors. They can be of the “Kumbaya” variety, or they can be what airports have with airlines: bitter.
The head of the aviation trade body IATA recently said “a bleeding airport is music to my ears” and accused airports of gouging airlines with fees. The head of a European airport industry association basically said airlines were one to talk, because they were gouging customers.
So how did things get so nasty between airports and airlines?
The relationship between airlines and airports is straight out of the African savanna, if you ask Andrew Charlton, managing director of Aviation Advocacy.
“The gazelles wake up every morning, and they start running because the lions are about to chase them,” he said. “The lions wake up every morning, and they start running because the gazelles are running, and that’s the relationship between airlines and airports in a nutshell.”
It’s unclear who is the gazelle and who is the lion in this analogy, but the tension between airports and airlines comes down to money. Airports charge airlines fees for using them, and many airports are trying to increase those fees.
“The airports lost a significant amount of money during the pandemic. Of course, airlines were also badly hit,” said David Primo, a professor at the University of Rochester. “The difference now is that airlines have recovered, but the airports are still, in their mind, trying to make up for lost time.”
The fees are more significant to airports than they are to airlines, said Samuel Engel, a senior vice president at ICF.
“For airports, typically 60% of revenue comes from airline charges, whereas for airlines, the airport charges represent a small portion of their total costs — typically in the neighborhood of 5-6%.”
But still, it’s a fight over a pot of money. “Price has been the only thing that matters for airlines and therefore, they look at every single expense. One of those expenses is airport charges,” said Aviation Advocacy’s Charlton.
But however much the airports want to charge, the actual amount is decided — or at least influenced — by some kind of regulator. And Primo said that’s why this nasty and long-simmering dispute is so public.
“Publicly complaining can actually have some effect, because ultimately these are, to some degree, economic decisions by airports,” he said. “But there’s also an element of politics involved, because many of these decisions are subject to the oversight of governments.”
Experts say this long-running dispute will likely keep on running. Airports and airlines need each other. They just also apparently hate each other.