Annoyed by Fees for Airport Luggage Carts? TFT Investigates
If you’re familiar with the free luggage carts available in many airports around the world, you may have been a little disgruntled when landing at one of the few U.S. airports which charges passengers for use of the carts — even in the international arrivals area. At present, the list is short, but it includes JFK, one of the nation’s busiest and most symbolic ports of entry. And more may be considering fees.
I witnessed the phenomenon at JFK a few years ago when flying to the U.S. with some very stuffed bags after several years living in Europe. While waiting for my bags in the pre-customs baggage claim area, I observed the throng looking through their purses and wallets for U.S. dollars in order to rent a luggage cart. I had the required $3 (now $5), but I wondered what others would do who didn’t have any U.S. currency considering there was nowhere to exchange currency and the dispenser machine was out of order, precluding the use of plastic. Instead, employees were taking the cash in exchange for carts.
Soon thereafter, I searched online for “JFK luggage carts” and came across a discussion thread dedicated to the topic (no longer available) in which many voiced their ire about the carts policy. Most argued this was an inconvenience found hardly anywhere else in the world, while a few dissenters accused the rest of laziness and simply lugging around too much stuff.
I took up the subject again recently in order to satisfy my curiosity with an even-handed evaluation of what may be behind the policy. I wanted to know why a few U.S. airports don’t offer free carts for the international arrivals area (let alone in the rest of the airport), while the majority do provide this complimentary service in the international arrivals area. The latter group of airports includes Los Angeles, Chicago O’Hare, Miami-Dade, Seattle, Dallas-Fort Worth, Houston, Phoenix, San Francisco, Oakland, San Diego, Washington Dulles, Boston, San Diego, Minneapolis St. Paul, Detroit, Atlanta and Honolulu. The airports which charge a fee for carts also in the international arrivals area are Philadelphia, Denver, JFK, Newark, and Fort Lauderdale, according to Smarte Carte’s Marketing Director Arthur Spring.
Spring noted in an email to the Faster Times that several airports are expected to start charging for these carts in the next couple of years and others are considering doing so. St. Paul, Minnesota-based Smarte Carte is the company that provides luggage carts to the great majority of U.S. airports.
The way the contracts work, airports pay a negotiated rate (for most from $0.69-$1.20) to Smarte Carte for each cart in the pre-customs international arrivals area. The airport in turn receives a portion of the revenues for luggage cart rentals in the pre-boarding area, but Spring said this hardly covers the costs of providing the free carts because usage rates are high. “The costs to U.S. airports which offer these complimentary carts is enormous,” he wrote.
I wondered if airports cover these costs in their landing fees and if that explains how many airports in the world can afford to offer free carts. Smarte Carte’s Spring affirmed this perception: “It’s buried in the landing or other charges to airlines, so the cost ends up in the ticket price even if you don’t see it.”
But, I got a different answer from Germany’s Frankfurt Airport. Frankfurt’s two terminals are home to a fleet of specially-designed luggage carts that can be taken on the escalators and have special safety features. In addition to these landside carts for check-in baggage, FRA provides smaller carts in airside/transit areas for carry-on luggage and duty-free purchases, according to Robert Payne, International Spokesman for Fraport AG, the company that manages the airport. The system includes approximately 4,600 landside carts at an original cost of about €500 per unit and 750 airside carts at about half the price per unit of the larger carts. Figures for the annual operating costs (logistics, maintenance, etc.) were not available, Payne said in an email.
Payne told the Faster Times in a phone interview the costs for the carts aren’t covered in the landing fee per se, but the airport like others globally is able to absorb the costs because of a different revenue base that makes use of multiple revenue streams — in contrast to American airports, which typically are run by public entities and are cash strapped. He added that the service is something Frankfurt has traditionally provided and it’s important for keeping passenger flow moving.
Travel Daily News reported in 2008 that non-aeronautical business activity in and around airports is increasingly important component of revenues. The article cites retail as the largest contributor to the non-aeronautical category, closely followed by car parking and property management.
But, even at a cost to themselves, many U.S. airports choose to offer free carts. Spring puts it to “a perception that foreign travelers might not have U.S. cash or credit cards,” a perception that he said “lingers, but is gradually fading.” He added that the company’s on-site employees are available to change currencies if needed.
For Spring, offering carts is simply a question of habit and custom. “Offering free carts is extremely expensive — anywhere from $2-$7 million per year for major international airports.” For large airports this also requires over 100 employees, he added. “Add the need for repairs and replacement after their 5-10 year life expectancy — all without any revenue generation associated with the passengers’ use of the trolleys.”
According to Travel and Leisure, European airports have historically absorbed the cost of free carts because of high revenues from air ticket sales, but as revenues were declining, European airports were beginning to impose a minimal fee and Smarte Carte believed at the time (2005) that many European airports were on the verge of signing contracts with the company. Spring said Smarte Carte had expected that for many years, but free cart systems have largely remained for three reasons.
First, customer resistence to pay systems leads to “skittishness on the part of airport management and staff.” “The passengers complain in very small numbers, but the airports are very sensitive to it.”
Second, “converting from free to pay results in job loss: a cart operator simply doesn’t need as many employees to run a pay-based system because fewer people use them.” And layoffs can be politically untenable for a unionized airport. Last, he said that airport staff often fight hard to preserve their personal responsibility for cart systems. “Moving to pay usually means outsourcing the service.”
Already, however, several European airports require a €1 deposit to obtain a cart from special zones in the airports, which is refundable upon return of the cart. Frankfurt Airport will be implementing a coin-deposit system for its luggage carts in 2011 — not as a revenue-generating mechanism, but simply to provide an incentive to prevent carts from being left near stairs, escalators, doorways and in front of the terminals, which “disrupts passenger flow especially at key traffic junctions”, Fraport’s Payne wrote in an email to the Faster Times. For passengers without coins, EC or credit card will be accepted by the cart dispenser, he added.
I obtained figures for one major U.S. airport about its complimentary carts program. The Los Angeles World Airports (LAWA) Board of Airport Commissioners agreed in early October 2010 to renew the contract with Smarte Carte for four years with an increase in the per cart fee paid to Smarte Carte from $0.68 to $1.51, according to a Board of Commissioners report issued prior to the Oct. 4 meeting. An LAWA spokesperson confirmed that LAWA decided to continue providing free carts in the international arrivals area at its two airports (Los Angeles International and LA/ Ontario International) at an annual cost of nearly $1.7 million to LAWA, which will be slightly offset by an increase in rental revenues from vendors in the airport totalling about $58,181.
Prior to the recent contract renewal decision, LAWA staff conducted a survey of U.S. airports noted that several airports have adopted a user-pay system due to these high costs and that passengers are carrying less baggage because of the imposition of checked bag fees, which results in a much lower usage rate for pay-to-use carts.
I inquired of JFK International Air Terminal (JFKIAT), which runs the International Terminal 4, whether free luggage carts have been considered and the rationale for charging for carts even in the international arrivals area. I wondered too if complimentary carts might be in Terminal 4′s future, considering that Schiphol USA, a subsidiary of the Schiphol Group, owns the Terminal. I was referred to the Port Authority for New York and New Jersey, which runs the Smarte Carte program for all JFK terminals, but did not receive a reply in time for this article.
Looking at some major airports around the world, free carts are still the norm.
Europe’s major airports, including Charles de Gaulle, Amsterdam and Heathrow, provide free carts throughout the airport. Some smaller ones, such as the one in Pisa, Italy and London Luton, charge a fee for cart usage. London Gatwick and Stansted require a refundable coin deposit (either a one-euro coin, a one-pound coin or a U.S. quarter) and Germany’s Hamburg and Munich aiports require a €1 coin refundable deposit.
Istanbul Ataturk Airport charges for carts, but they are free at the city’s other airport, Sabina Gocken International Airport. Sharm el Sheik Airport, Egypt’s second busiest, charges a nominal fee for carts. Johannesburg Airport in South Africa has free carts.
Free carts are standard for Asia, available for both domestic and international arrivals in Tokyo’s Narita airport, Seoul Incheon International Airport and Beijing’s Capital International Airport and New Delhi’s Indira Gandhi Airport, among others.
Sydney International Airport charges $4 (Australian) for carts for departing passengers on departure roadway and in the car park, but provides them free for international arrivals area. Meanwhile, Brisbane Airport, Australia’s third busiest, offers free carts throughout the aiport.
In the Western Hemisphere, most Canadian airports offer complimentary carts throughout the airport, including Vancouver, Calgary and Montreal, while Toronto Pearson charges $2 CAD. Mexico City’s airport offers carts for free in the international arrivals baggage claim area. Rio de Janiero’s Galeão International Airport offers free carts as does São Paulo-Guarulhos International, a South American hub and the busiest airport in Brazil.
Regardless of whether free carts will become an increasing rarity, I will be especially grateful for each opportunity to use one on the house and will have more understanding for those few airports that do not provide complimentary carts. In the case of JFK, I can only hope international visitors will be equally understanding when searching their wallets for U.S. currency at the baggage claim.
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