What are the main sources of non-aeronautical revenue at an airport?

May 2018

The weight of the revenue from non-aeronautical activities has only grown in airports around the world in recent decades. The International Civil Aviation Organisation (ICAO), a specialised agency of the United Nations, states in their latest Handbook on the economic aspects of airports (only available in Spanish) that as the volume of passengers increases, not only does the business in the commercial area increase, but so does the share of the total revenue compared to those from the collection of air traffic charges.

This trend is due to the rise of a new airport concept: the airport city or air metropolis, a space that extends its influence beyond aircraft operations that is integrated into the daily life of the passenger and the community, establishing itself as a thriving centre of economic activity.

What is the business of this type of airport based on? Let's review what types of business activities are most common at international airports.

What kind of non-aircraft activities does an airport host?

The ICAO highlights in its report the following main sources of non-aeronautical revenue at an international airport:

  • Fuel supply for aircrafts
  • Catering (restaurants, cafeterias, vending machines, etc.)
  • Airport shops affiliated with the local tax and duty-free regime that is dedicated to retail sales
  • Banks and currency exchange offices
  • Provision of food for consumption on board the aircraft
  • Taxi and other transport services between the air facilities and nearby towns
  • Car rental
  • Parking
  • Advertising at the airport
  • Petrol stations for cars
  • Hairdressers
  • Vending machines for non-food items
  • Areas of consolidation of loads and dispatch of goods

According to the ICAO, the larger the airport, the larger the size of its commercial establishments, as well as the diversification and specialisation of non-aeronautical activities.

Óscar Díaz Olariaga, a professor at the Antonio Nariño University in Bogotá, underlines, based on data provided by the Airports Council International (ACI), that most of the non-aeronautical revenue comes from the concessions for retail sale at airports in all regions of the world except the Middle East, where the most significant revenues come from parking. Díaz Olariaga makes this analysis in his article Recent development and current relevance of commercial airport revenues, (only available in Spanish) published in the magazine Estudios Gerenciales from the Universidad Icesi of Cali.

 

The weight of non-aeronautical revenue over the total revenue

Diaz Olariaga's document also studies the weight of commercial revenues over the total airport revenues, as well as the average non-aeronautical revenues per passenger in the different regions in the world. Some of its conclusions are:

  • Commercial activities involve as much as 50% of revenues at Asia-Pacific airports, while the area where they are least represented is Africa (32%). Latin America and the Caribbean are in second place with (35.4%).
  • Airports where non-aeronautical activity brings the greatest benefits are those in the Middle East, where each passenger leaves an average of 16.75 USD. It is followed by Europe with 16.1 USD, and lastly Latin America and the Caribbean with 7.4 USD.

 

How to increase the commercial revenue of the airport?

Increasing the non-aeronautical revenue of an airport requires data collection and analysis using Business Intelligence (BI) techniques to obtain key information to guide decision making. This process is already immersed, for example, at the Quito airport with the implementation of the Ikusi software.