General Aviation

Uber and Lyft Lyft Airport Revenues

By June 13, 2017September 15th, 2020No Comments
The headline for this edition of our frequent blog, Uber and Lyft Lyft Airport Revenues is of course a little tongue in cheek but actually true across most airports in the US (and possibly the supplies and the rest of the world as well).
Do you frequently park your personal vehicle at the airport when taking trips? Most of us do. In the parking rates are not inexpensive as we all know, and in the airports we frequent the daily parking rate is anywhere from a discounted $18 a day if you buy in advance to $25-$35 a day “posted retail” as they say. And until a few years ago it was either take a taxi or van transportation to the airport or drive your own vehicle and park it at the airport garage. Now there were some of those who skillfully sought out the most inexpensive parking solution and that was to park at “off airport” facilities, parking lots a few blocks away from the entrance to airports and this became big businesses in themselves charging rates from $5 dollars to $10 dollars a day. To snag this discount of course you had to write a shuttle from the airport to the off airport location and this of course added another 15 to 30 minutes at least to your total transportation time. I never felt it was worth the discount, where you now were adding an additional 15 to 30 minutes to the already “get to the airport two hours early” routine. “Time is money” as they say so for me, it was airport parking, no other practical option.
Well, things dramatically change with the arrival of Uber and Lyft a few years ago. In the beginning of their introduction most of us “more mature” travelers weren’t aware, or chose to ignore this new, what would become a true paradigm shift in transportation. Individual owners of vehicles providing transportation anywhere you wanted to go with the ease of an app. What could be more current than that? The younger generation embraced it immediately. It was cost-effective to say the least, especially in larger cities where the cost of maintaining your own vehicle was very cost prohibitive.
Finally we decided to try this newfangled “Uber thing” seriously about a year ago. We had been using a town car service booking directly with the driver which cost us $60 cash from home to airport or airport to home. This was for a 25 minute ride, approximately 30 miles to the airport.
So we tried out the Uber experiment, and not without a little bit of angst and wonderment how this “thing” was going to work for us. We tried it once, it worked extremely smooth. Nice person arrived in a fairly new personal vehicle, a nice conversation to the airport, and most of all our $60 ride to the airport in the town car became as low as $21 in the Uber!  That works out to 35% of the cost of the town car $60 trip. Now the Uber wasn’t a town car, (and you can get fancier vehicles, even town cars for a higher price which then pretty much matches the standard town car rate). But was the town car worth $39 more to go to the airport? That of course is a personal decision and for the traveler who doesn’t need work cares to watch expenses then it’s a nonissue, go with the town car. But you will find yourself a minority except in the expensive business centers of America like New York City and downtown Chicago.
The travelers commuting to and from airports began using Uber and Lyft for convenience, for price, and some just for a more pleasant experience. Notice next time you are returning home from a trip the Q stand for the ridesharing services. At the same time glance over if nearby to the taxi stand and town car Q stand for them. You will be astonished at the activity of the Uber and Lyft pickup points, and the lack thereof at the taxicab stand.
This is truly a paradigm shift.
But what does this have to do with airports? Let’s go back to our title, Uber and Lyft Lyft Airport Revenues. Many times a week there are reports of airport after airport reporting significant, large, drops in airport parking revenue which can be directly attributable to this paradigm shift to the use of Uber and Lyft services.
There’ve been some legal fights between the Uber and Lyft services versus the airports and the taxi service operators. Almost without exception these issues somehow become resolved and Uber and Lyft services become available for the Travelers choice and the travelers are voting with their wallets and purses. The losers, the taxicab companies, van services, and the airports, financially speaking. The winners, the travelers themselves enjoying huge, really huge discounts in transportation costs to and from airports.
The airports are scrambling to figure out ways to counter the decline in parking revenue as a result of Uber and Lyft services. The airports are not going down without a fight so expect “creative” implementation of airport user fees similar to those charged often by airports to the traditional transportation services like taxis and van service companies.
Let’s hope we don’t lose the cost-benefit that Uber and Lyft services have created!
FBO Advisors, LLC
Serving the FBO industry for more than 40 years