Airports and Deregulation

hroughout the period of Civil Aeronautics Board regulation of air carrier routes and rates, airports competed with each other for the limited amount of traffic that was available. Traffic was limited not only because CAB policy restricted the number of available routes, but also because it mandated high airfares. During the 1950s, 1960s, and most of the 1970s, airports maintained mar­keting departments whose functions included lob­bying the airlines and the CAB for service.

After deregulation, the passenger counts flowing through the airports of the United States increased by a factor of three over those in 1978, with an all-time high of over 726 million in 2007.1 The problem was no longer one of how to secure more service; rather it was one of how to service the existing, and increasing, traffic.

Commercial-service airports were suddenly faced with the need for more gates and runways (airside expansion) and for more groundside support facilities (parking, restaurants, rental car counters, ticket counters, and shops). Meth­ods of funding for renovation and expansion had to be addressed anew. The developing oper­ational practice of the airlines known as hub and spoke, with its concentration of passenger arrivals and departures all at the same time, put severe pressure on airport operations. Control of
existing gates had to be reevaluated in view of the increasing number of airlines requiring access to the limited number of available gates. Envi­ronmental concerns, both from increased aircraft operations and from ground traffic to and from the airports, brought additional pressures on air­port management practices.

The commercial air service industry consists of three essential components:

1. Air carriers

2. Air traffic control (АТС)

3. Airports

While all three of these components must combine to function in an orderly and cohesive manner, the provisions of the Airline Deregula­tion Act directly controlled only the air carriers. In other words, only the air carrier portion of this combination had been deregulated. The federal government is solely responsible for the opera­tion of the АТС system, and it is significantly involved in the operation of airports. Airports operate under a matrix of federal regulations, and commercial-service airports are all owned by local, regional, or state governments or their political subdivisions. While deregulation had unleashed the power and innovative potential of

FAA Forecast

Total Operations Not Projected to Return to 2000 Levels in the Foreseeable Future

Ф>ф>ф>ф><їґф>ф>ф>’уф>фіф>ф,‘уфіфіфіф>ф>ф>ф>&ф>ф, ф>&ф>&ф>’р,<іґ,<1ґ’і? FIGURE 33-1 FAA forecasts suggest breathing room for airports.

Source: FAA Forecast Table 32 (http://www. faa. gov/about/office_org/headquarters_offices/apl/aviation_forecasts/aerospace_forecasts/ 2012-2032/))

private enterprise in air carrier operations, the inherent limitations of government control in the АТС and airport sectors still overlay, and con­strain, that potential. We will review how these factors have impacted modern airport operations.