Victoria International Airport is the lowest cost per passenger airport in Canada, according to the annual airport benchmarking report prepared by the Air Transport Research Society.
The international group, which measures and compares the operating efficiency, cost competitiveness and financial performance of 200 airports worldwide in the report, ranked Victoria top of the Canadian heap in two categories.
Victoria was found to have the lowest cost per enplaned passenger of the 12 major Canadian airports, and YYJ generated the highest percentage of its total revenue from non-aviation means. Enplanement refers to boarding or connecting passengers.
Overall, Victoria was ranked eighth in the North American market in terms of percentage of revenue derived from non-aviation sources and 21st in cost per passenger.
“It is extremely important to us to be a low-cost airport because we recognize that profit margins in the airline industry are thin, and this allows them to keep their prices down. At the same time, we have been able to execute our capital programs and deliver a world-class facility,” said Geoff Dickson, chief executive of the Victoria Airport Authority.
Dickson said the two categories the airport topped in the report work in balance to keep costs down for all air carriers that use Victoria.
“We’re pretty proud of this and it’s nice to be recognized because it’s very much our mantra — keep our costs low,” he said. “Victoria needs to be in a position to be low-cost because we are trying to attract more carriers, so if we can ease their costs that’s a win all round for the region.”
The study, which was delivered during the Air Transport Research Society annual world conference in Bordeaux, France, in July, determines the cost per enplaned passenger by basically dividing the number of passengers by the cost borne by the airline to use the airport — Victoria’s cost per passenger is about $7.50.
Victoria’s percentage of revenue derived from means other than aviation was 67 per cent, which Dickson believes is a sign of a healthy operation.
“It’s a sign of a company that’s focused on diversifying its revenue stream and not being overly reliant on one particular source,” he said.
Victoria airport gets 29 per cent of its income from transportation and parking — buses, taxis and parking lot revenue — 20 per cent from its terminal building tenants, including restaurants and rental car companies, and 18 per cent from rent and leases from tenants on airport lands.
“You can get revenue by charging the airlines or generating it in more discretionary areas which lowers the costs for the airlines,” he said, noting it all plays a role in keeping fares low at the end of the day.
The Air Transport Research Society was established in 1995 in Sydney, Australia, and is headquartered at University of B.C.’s Sauder School of Business.
The annual Airport Benchmarking Report was first released in 2002.
