Airport Officials Await Approval To Offer More Incentives To Airlines
Written by Wayne Tompkins on June 21, 2007
By Wayne Tompkins
Building on an earlier program’s success, Miami International Airport will offer commercial and freight carriers a second round of incentives in hopes of luring service to international and North American destinations.
The program, pending Miami-Dade commissioners’ approval at their June 26 meeting, contains a wish list of international cities ranging from Nairobi to Shanghai to Warsaw as well as additional service to US and Canadian cities.
The new program would offer a package of waived landing fees and matching funds for marketing campaigns to carriers establishing routes.
"The incentive program is not the panacea — it’s one of the tools that we use" to attract new business, said Miguel Southwell, assistant director of business development for the Miami-Dade Aviation Department.
Miami International is one of the most expensive airports in the country for airlines, at $17.01 per enplaned passenger, which the department is using a variety of strategies to lower. Financing of the airport’s $6.2 billion capital improvement program, now $1 billion over budget, is increasing the cost of doing business at the airport.
Fort Lauderdale-Hollywood International Airport operates at a much lower cost of $4.36 per enplaned passenger, spokesman Greg Meyer said. Mr. Meyer said that is likely to increase in coming years as the airport finances a runway expansion.
Miami International’s incentives have proven a valuable piece of the airport’s strategy.
When a similar incentive program launched two years ago waived a combined $680,000 in landing fees for the four domestic and two international airlines that participated, the airlines introduced nonstop flights to four US cities and three new international destinations. Estimates are that the flights will generate 242,000 passengers annually.
The added routes serve Tel Aviv, Cozumel, Mexico and the resort city of Barcelona, Venezuela, as well as Seattle, Chicago, La Guardia Airport in New York and Fayetteville, Ark. That program expired last month.
Landing fees will be waived for a year for any carrier establishing service to a new international destination or an additional route to a domestic city the airport currently serves. New cargo freighter service also will receive incentives.
"We’re proud of our status as the gateway to Latin America and the Caribbean," Mr. Southwell said. "In terms of our trade and tourism development, however, we need to diversify our service if Miami is going to be a truly international city."
The airport is looking at markets in Eastern Europe and Asia as well as the long-underserved African market where "the geography is to our advantage," Mr. Southwell said.
Total landing-fee waivers and matched advertising-fund commitments will be capped at $3 million each year and awarded on a first-come, first-served basis.
New seasonal passenger service from the airport would receive a 25% landing-fee reduction.
The department will offer a carrier up to $50,000 to help promote the new route, which will be matched with an equal amount from the airline.
Cities the airport would like to begin direct service to include Capetown and Johannesburg, South Africa; Addis Ababa, Ethiopia; Nairobi, Kenya; Lagos, Nigeria; Casablanca, Morocco; Brussels; Dublin; Helsinki; Moscow; Warsaw; Budapest; Tokyo; Seoul; Hong Kong; Shanghai; and New Delhi or Mumbai, formerly Bombay.
A carrier establishing year-round cargo freighter service from a new Asian, African or European market will qualify for a 50% landing-fee abatement for a year.