Delta awaits city’s word on new lease

The cost for an airline to operate at Hartsfield-Jackson is lower than at many other large airports.

At airports around the country, facilities are aging and need investment to keep operating, said Susan Warner Dooley, a vice president in HNTB Corp.’s national aviation practice. “Many airports are finding even though they have diligently worked to reduce their total costs, the rates being paid by airlines are still increasing,” she said.

Airlines calculate their own costs to operate at an airport, incorporating leases on terminal space, gates, landing fees, maintenance and some passenger charges. The cost per enplaned passenger can vary between airlines even at a single airport. That’s because different airlines have different aircraft that carry varying numbers of passengers, and they also use terminal space, gates and airport services differently, depending on their business models and size of operations.

Comparing airports can also be complicated, because airports calculate charges differently and there’s limited standardization. While other airports incorporate the costs of operations and maintenance into their charges to airlines, in Atlanta, the airlines are responsible for those costs and decades ago formed the Atlanta Airlines Terminal Corp. to fulfill that responsibility. Another factor that can affect comparisons is varying passenger facility charges at different airports.

Atlanta is still Delta’s largest hub by far. Delta had threatened that it could move flights to other hubs such as Memphis early on in lease negotiations with Atlanta. At the time, Delta urged Hartsfield-Jackson to protect “its important competitive cost advantage over other hub airports with which it must compete.”

Now, Delta still operates some 1,000 daily flights from Atlanta, making it the largest airline hub in the world with nonstop flights to cities around the globe.

Delta’s history in Atlanta dates to 1930, and the airline moved its headquarters here in 1941. The decades of intertwined development have led to a virtually interdependent relationship. Without its Atlanta hub, Delta would lose its largest operation — an operation that plays a unique role in its flight network. And without Delta, Atlanta would not be the global city it is, attracting travelers, residents and companies from around the world because of the critical links through plentiful commercial flights.

A key factor city and airport officials discussed with the Delta lease is Hartsfield-Jackson’s ability to welcome other airlines that may want to expand in Atlanta. Airport costs and accessibility of gates and facilities are some of the factors airlines consider when they decide whether to expand at an airport. Other critical factors are the size of the local population, the local economy, major corporations and the city’s tourism draw.

Maintaining a competitive environment at the airport by allowing other airlines to enter the Atlanta market can help improve choices for customers and improve price competition. Delta and AirTran both point out that Atlantans already enjoy the benefits of competition between a major legacy carrier with the world’s largest airline hub and a low-cost carrier to keep fares down.

Many large airports with low costs — such as Hartsfield-Jackson — are major airline connecting hubs. Such connecting hubs also have many more flights than the city might otherwise merit because airlines choose to route passengers through there. Using a connecting hub benefits an airline, but it also benefits the residents of the hub city who have access to more flights because of it.