The impact of airline-airport relations on airport management decisions

Abstract

Airlines, in the past, have had an important influence on airport operations through privileges granted them by the airport lease agreements. Airport administrators and sponsoring agencies have agreed to grant these privileges because much of airport capital investment has been amortized with airline money. This has been accomplished through the mechanism of the long-term lease. This paper examines the working relationships which have been developing between airlines and airports in recent years. These relations have been influenced by deregulation and by inadequate airport capacity--both actual and anticipated--for growing passenger demand. Through an examination of the current role that airlines play in obtaining capital financing for airports, and an analysis of the leases and use agreements between airlines and three U.S. airports, a consideration of the diverging priorities of airports and airlines is presented.