ACI-NA Celebrates 2018 Infrastructure Week at TPA

Infrastructure Week, a week-long celebration of the vast network that supports – and moves – the U.S. economy, is taking place this week. ACI-NA’s Airport Infrastructure Needs Study details that U.S. airports have nearly $100 billion in infrastructure needs through 2021 to accommodate growth in passenger and cargo activity, rehabilitate existing facilities and support aircraft innovation.

For Infrastructure Week 2018, Tampa International Airport hosted ACI-NA and Building America’s Future (BAF) along with members of the Tampa Congressional delegation for an event focused on the need for airport infrastructure investment. This video highlights the lawmakers and industry leaders who called for robust infrastructure investment during the event.

Inspiring “Island” Travel

By Doug Newson, CEO, Charlottetown Airport Authority

Operated by the Charlottetown Airport Authority Inc. (CAA), the Charlottetown Airport (YYG) is located in Canada’s smallest province, Prince Edward Island (PEI), or as the locals like to call it, “The Island.” Although small in size – with a population of about 150,000 residents – thanks to the beautiful beaches, world-class golf and delicious culinary products, we are one of Canada’s most popular tourism destinations, attracting more than 1 million visitors each year. Being one of three entry points on to the Island, the airport’s importance to the province, and especially the tourism industry, is significant. So, by connecting Islanders to the world and the world to our Island, YYG is inspiring Island travel – at record levels.

PEI has seen four consecutive years of record tourism growth, which has resulted in record traffic levels for the Charlottetown Airport. In 2017, passenger traffic surpassed the 370,000 mark for the first time. This outdid our previous high by more than 15,000 passengers. In the past 10 years, passenger movements at our airport have increased by 57 percent. Our recent growth has been driven by significant capacity increases from our main airline partner, Air Canada.

In 2016, Air Canada introduced their leisure airline subsidiary, Air Canada Rouge, to our market, bringing Airbus 319 and 321 from Montreal and Toronto for the first time – a great product for our busy summer season as well as the meetings and conventions sector that thrives in the shoulder seasons on PEI. The Air Canada service is complemented by our other main airline partner, WestJet, that operates two 737 aircraft per day to Toronto in the peak summer season.

Over the past two years, CAA has been investing heavily in its airside infrastructure. In 2017, we completed our second year of a three-year, $25 million Runway Improvement Program – the largest infrastructure investment in CAA’s history. Already providing a $115 million economic impact to our province, this investment will drive further economic growth from YYG by creating jobs for Islanders while also improving our infrastructure and operational effectiveness.

The first phase of the program, which took place from 2016-2017, saw the addition of 2,000 feet to our 5,000-foot crosswind runway, 10-28.

The project consisted of earthwork, installation of a drainage culvert, gravel, asphalt, electrical upgrades, and the construction of two RESAs (runway end safety areas). This project progressed very well and produced some impressive numbers: 50,000 truckloads of earth were moved, 50,000 tonnes of gravel was spread, and 8,000 tonnes of asphalt laid. Expanding runway 10-28 gives us two 7,000-foot runways to significantly improve airport operations, flexibility and safety in different wind and weather conditions. It also means there will be no negative impact to Islanders and tourists in summer 2018, when major rehabilitation work is required on our main runway, forcing the closure of this runway for the entire peak tourism season.

As 2018 progresses, we are now into this final phase of the Runway Improvement Program, which consists of the rehabilitation of Runway 03-21 and connecting taxiways Alpha, Bravo and Charlie. Major components of the work are grading and drainage improvements, storm water replacement, electrical replacement and rehabilitation, and reconstruction of the pavement structure. The primary objective of this project is to ensure the continued safe operation of the Charlottetown Airport so that it can continue to capitalize on recent growth trends and drive economic value for our community.

As mentioned, tourism is a significant growth factor for our airport but with our growing numbers we also feel confident in saying we are proud to be the launch pad for Islanders’ adventures all over the world. This past year we thought we would celebrate that by asking Islanders to share their travel adventures and photos with us. The response was overwhelming. Hundreds of people submitted photos that capture the energy, inspiration, wonder and excitement of exploring a new destination. As an ode to our travelers, we’ve created a curated photo display in our departures lounge with a selection of 100 photos from nearly 30 countries that span every continent. We call it Just Go! The installation also features an interactive touch screen component that allows passengers to view more about the travelers and their stories. It’s a celebration of our customers, their travels and the adventures that inspire others to explore the world. They certainly inspire us in our work to help connect Islanders to the world. Our vision here at the Charlottetown Airport is simple.

We want to provide an exceptional passenger experience, with genuine Island hospitality. As we look to the future, we will never lose sight of this vision and continue to invest in our airport to meet the needs of our residents, visitors and those coming to our Island for business. New programs and services to enhance the passenger experience are on the horizon, as we understand the importance of maintaining and improving our services and facilities to inspire “Island” travel.

Global Trends in E-Commerce

By Ricondo & Associates Inc.

The increasing use of electronic commerce (e-commerce) has changed the landscape of global retailing and is affecting activity at airports. The development of e-commerce includes retailing in airport terminals, but is more significantly related to an airport’s interaction with the business, logistics, and cargo networks that can provide competitive advantages to companies in, for example, assembly, sortation, regulation, speed, assurance, and cost of delivery. The widely anticipated growth of e-commerce worldwide presents significant opportunities for airport owners to recognize trends, support the e-commerce business network to the benefit of their tenants and their own financial results, and contribute to regional economic development.

OVERLAYING DEVELOPMENTS

Several overlaying developments contribute to the growth of e-commerce:

  1. Increasing concentration of the world’s population in urban areas with global connectivity, which increases the importance of the world’s airports in moving passengers and goods around the world.
  2. Increasing self-owned, single-person businesses, also frequently referred to as the “gig economy” or “on demand economy.”
  3. Technological advancements to enable globalized commerce.

LEADING E-COMMERCE MARKETS

There are varying estimates of e-commerce sales by country, but, in most cases, China is shown as the leader because of its very large population base and rapid adoption of technology.

E-COMMERCE GROWTH IN UNITED STATES

The United States is the second largest online market in the world (following China). Many U.S. retailers are investing in international operations, and many international e-retailers are investing in the U.S. market.

Online sales still represent a relatively small share of total retail sales in the United States (about 8 percent in 2016), but the online share has been increasingly rapidly. This illustrates the potential for significant future growth in e-commerce in the context of the very large overall U.S. retail market.

LOGISTICS AND DELIVERY ARE KEY TO E-COMMERCE

E-commerce, in most cases, replaces the experience of shopping at a brick-and-mortar store, and requires the delivery of goods to the purchaser. According to the U.S. National Retail Federation, about 60 percent of online sales in 2015 included free shipping.

Free shipping is a competitive advantage, but also a cost. Combined with increased demand for speed of delivery (2-day, 1-day, or same-day), shipping to individuals is a major logistical challenge central to the business offering.

National postal services have become more relevant with the rise of e-commerce because of their networks of local couriers and ability to deliver to individual residences. Delivery is more complex with cross-border trade—myriad issues exist, such as multiple operators, customs clearance, customer payment, taxes, and currency exchange challenges.

One area of interest for e-commerce is the potential for drones to deliver packages, and thereby solve one of the more costly and complex elements of e-commerce fulfillment. The potential for drones is particularly important for airport owners to consider because, if there is an alternative delivery method, questions arise regarding investment in airport facilities for more traditional air cargo and the potential airport role in supporting the use of drones for e-commerce delivery.

OPPORTUNITIES FOR AIRPORTS

Airport owners have multiple opportunities to participate in the growing e-commerce business.

Strategies need to be developed in accordance with the local setting—geographic location, economic fundamentals, and airport infrastructure. With the continued globalization of economic activity, and the associated increase in cross-border e-commerce, airports with established international gateway operations and networks of logistics businesses familiar with the intricacies of international trade will be well-positioned.

The Miami-Dade Aviation Department, operator of a system of airports in Miami-Dade County, Florida, has invested in strategic planning to leverage the combined (1) rapid growth in e-commerce, and (2) Miami’s unique position as an international center of commerce and air cargo for Latin America. A multifaceted approach to analysis and planning includes evaluating cargo infrastructure needs and the potential use of various airports in the system, and coordinating with stakeholders on-airport and in the community.

Recently, the Miami-Dade Aviation Department conducted a workshop with airlines, integrators, logistics providers, community economic development leaders, and others to discuss challenges, opportunities, and collaboration strategies related to e-commerce.