Management & Operations

Airport ground transportation business drops up to 80% after Sept. 11

Posted on February 1, 2002

Business for ground transportation operators dropped between 20% and 80% in the two weeks following Sept. 11 and the air travel slowdown, according to a survey by the Airport Ground Transportation Association (AGTA). Seventy-three percent (29 of 40) surveyed said they would not be able to continue operating if business persisted at the same levels. Fifteen percent of respondents laid off more than half of their drivers in September to cut costs. Many companies also reduced employees’ hours, reduced runs and downsized or parked fleets. “Our general finding was that companies serving general tourist markets were off typically about the same percentage that airports were off. But companies that service high-end business travelers — like private car services — were off between 40% and 50% during this period,” said Dr. Ray Mundy, executive director of the AGTA. Subsequent surveys by the AGTA showed that though ground transportation business is not as dire as it was in September and October, the industry is still hard put to recover, especially as business travel goes through a period of transformation. “We’re experiencing a change in traveling by the American business industry,” said Mundy. “Major corporations have cut back heavily, made layoffs and completely abandoned all but essential travel, decreasing travel budgets by as much as 80%.” Marc Kaplan of Catalina Limo & Transportation Service, which services Tucson International Airport in Arizona, said business has come back considerably but is very different. Ninety-five percent of Catalina’s business is convention-related, and it has been hurt by the changing habits of business travelers. “There are fewer groups coming in, and they stay less time and definitely don’t spend as much money,” he said. Survey results also showed that 95% of respondents felt some form of government aid was appropriate, and many operators have already applied for available assistance. Catalina applied for and received the Small Business Administration Economic Injury Disaster Loan (EIDL) the week after Sept. 11. The AGTA conducted these business assessment surveys to inform participants on how companies around the country were hit by the crisis, and how they are handling the decrease in airport traffic. The data will also be distributed to government agencies in an effort to encourage legislation, aid and financial relief on behalf of operators.

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