The Atlanta airport has set aside $2 million per year over the next five years in a bid to lure new international cargo and passenger routes to the city under a plan that the Atlanta City Council approved in April.
Qualifying airlines are to have landing fees waived for one year and receive airport funding of up 50 percent of marketing expenses to promote the new route, up to $25,000. Though Hartsfield-Jackson Atlanta International Airport keeps landing fees relatively low, airlines usually pay between $100,000 and $150,000 for a yearly slot to land a wide-body aircraft.
The move underscores that the airport is on the same team as its tenants, Jason Terreri, Hartsfield-Jackson’s interim director of new business development, told Global Atlanta.
“(Airlines) look at this as a way that the airport gets some skin in the game to get them to the airport, so they don’t bear the entire financial risk of entering a new market,” he said.
Delta Air Lines inc., which occupied about 70 percent of gate space and has been expanding in Latin America and Europe, was involved in the consultations and stands to benefit along with other carriers, Mr. Terreri said.
“As they set new routes, and we hope they do, they’ll be able to benefit from more incentives,” he said.
The airport is prioritizing new “emerging” and “premier” markets like the so-called BRICS economies – Brazil, Russia, India, China and South Africa – providing two years of landing-fee abatement on new routes to these countries. Routes to Africa, Eastern Europe or Southeast Asia, other emerging regions, will also be given special consideration.
Turkish Airlines has said it is eyeing an Atlanta flight, and a City of Atlanta delegation visited the country around the time the incentives were announced. No concrete results have been announced.
Mr. Terreri said the $2 million program expense is to come out the airport’s general fund and is “revenue neutral” to existing airlines. In other words, the airport is not raising their fees to bring in newcomers.
“It’s a first-come first-served program, and once the program is exhausted then there is no more for the rest of that year,” he said, adding that incentives are common among other airports but that Atlanta hasn’t had them in the past.
MIguel Southwell, the airport’s new general manager, says it’s just one more way the airport is seeking to accomplish what he sees as its main function: generating wealth for Atlanta. See a profile of Mr. Southwell
“As the world’s busiest airport, we are continually looking at ways to grow new routes and expand our cargo capacity, and this will certainly boost our global competitiveness,” he said in a news release that noted that the program is mainly designed to enhance Atlanta as a cargo hub.
Mayor Kasim Reed has expressed a desire to make Atlanta the “logistics hub of the Western Hemisphere,” and the airport has had a few wins on this score as of late. Emirates SkyCargo in March announced that it will bring a weekly cargo route to Atlanta, servicing it with a dedicated Boeing 777 freighter.
While Emirates was a newcomer, Lufthansa Cargo in November announced that it was upgrading its existing service to a Boeing 777, which carries 20 percent more cargo that the MD-11 previously servicing the route.