John Wayne Ride-Share Growth Prompts Fee Revamp
Tuesday, September 04, 2018
John Wayne Airport will raise fees paid by ride-share companies, limousines and shuttles starting Sept. 1 to be comparable with other airports and profit from fast-growing firms, including Lyft Co. and Uber Technologies Inc.
Transportation companies here currently pay $2.25 per pickup of passengers and nothing to drop them off.
Beginning Sept. 1, the fee applies to both pick-ups and drop-offs. Then on March 1, each fee rises to $3.
Transportation fees haven’t changed at JWA since 2002, and rates were the lowest of six airports, including those in Los Angeles, Long Beach, Ontario, Burbank, and San Diego, which already charge $3 to $4 for either a pickup or a drop-off, according to an airport staff report.
Hikes are also meant to reverse an annual revenue hit of $5 million mostly due to fewer people parking at the airport, a study by New York-based transportation consultant Frasca & Associates LLC showed.
The Board of Supervisors essentially approved the hikes on Aug. 14; a required second vote is scheduled for Aug. 28. An airport spokesperson said by email it’s a formality.
The number of pickups and drop-offs by airport ride-sharing companies Uber, Lyft and Wingz almost quadrupled from 15,000 a month in July 2015 to 55,000 in July 2017, according to the staff report. This past May and June, monthly totals hit the low 70,000s, indicative of an annual rate of 850,000.
Total passengers at JWA rose from 10 million in 2015 to 10.5 million in 2016, with a slight dip to 10.4 million last year. The current airport passenger cap is 10.8 million.
Airport Director Barry Rondinella praised the popularity of ride-sharing to the board but said the huge boost has cost the airport money. He said the “steep decline” of $5 million in annual revenue would grow without action.
Public parking, rental car, and ground transportation fees combined are the largest revenue source at JWA, accounting for about 40 percent of its $130 million fiscal 2017 take.
Most of the decline derives from $3 million in lost parking revenue in its most recent fiscal year, down 8 percent.
Parking exits decreased by 124,000 last year, despite a stable stream of passengers.
Taxi service also dropped in fiscal 2017, by 16 percent or 52,000 fewer trips, though taxi revenue has increased about 1.6 percent in each of the last three years to about $900,000.
JWA Yellow Cab is the airport’s exclusive taxi provider under a deal that began in December 2016 and expires in December 2021. It pays $20,300 a month to lease the taxi lot and $2.25 for each pickup.
Frasca recommended reviewing taxi company rates when the deal ends.
Frasca’s study also said some airport parking should cost more, but supervisors raised only some transportation fees.
Maximum daily parking rates run $14 to $30, depending on where people park and whether they use a valet. Short-term rates are $1 for the first hour and $2 an hour thereafter.
Rates haven’t changed since 2008 and in some cases are also among the lowest of the six regional airports, the airport staff report said, adding that parking revenue would be reviewed in the future.
Frasca recommended hikes of 15 percent to 20 percent—$2 to $4 per day—in maximum rates with no bumps for short-term stays.
Rental car firms pay a 9 percent fee for curbside pickup and drop-off, subject to a minimum annual guarantee and no fee if customers walk to their nearby facilities. Disneyland Resort Express, operated by Coach USA, pays 20 percent.
Frasca’s study recommended those rates not be changed but said such providers may ask for lower annual minimum guarantees in their next contracts, given the increase in ride-sharing.
Source: Orange County Business Journal
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