IATA has suggested air traffic growth seems to be resuming after the economic decline of 2008-9. Future growth trends will be driven by the low-cost airlines (LCC), as they continue to increase their passenger loads. LCC’s have revitalized many regional airports, leading to competition between airports and the need for airports to be competitive in their fees.

This presents a challenge to airports to find new sources of revenue, with the clear understanding that they cannot continue to operate with a “more of the same” attitude.

Airports recognize that they must adopt new approaches in order to actively support this growth of air travel and be competitive. Those airports that successfully rise to the challenge will become “Airports of the Future” and will exhibit three key characteristics that distinguish the successful from all others:

Lower-cost operating costs
Faster and more efficient passenger flows
New revenue streams, driven by increased retail and services opportunities

Compounding the airport’s struggle to compete in today’s global markets are several conflicting resource demands. The airports’ global association, the Airports Council International, highlights some of their members’ priorities:

“Sweat the Assets”: the effective and efficient use of facilities
Growth …

As mentioned in a previous blog, Regional Airports: Challenges, Opportunities, airports continue to struggle to provide a competitive environment for their airline, GA and passenger constituencies. New or increased revenue streams are currently a top priority for most airport executives and their boards. Two sources of revenues most likely to be discussed by them are the PFC and non-aeronautical (commercial) income.

The first is the passenger facility charge (PFC). There is a current debate between the airlines and airports on this as a source of revenue. The PFC is a fee paid by passengers who use the airport and is generally spent on projects that increase airport capacity, safety, and security. The PFC has a maximum, which is a set by federal authorities. Not all airports charge a PFC, and many have a lower-than-allowed charge in place. Many airports see this as an excellent strategy to encourage new airlines or route development.

The second, and the real challenge for airports, is how to focus their funding strategies to increase their non-aeronautical (commercial) income. In many cases, this means increasing their retail and services revenues for …