Airport Privatization Essay

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Airport Privatization: Situation and Prospects Would the United States air transportation industry benefit by the privatization of its 378 airports? Is there a need for the Federal Government to be in the airport business? Is it possible that privatization would create a positive Return-On-Investment for its investors? And, would privatization benefit the customer base, i.e. customer satisfaction, improved on-time rating, lower fees, standardized pricing and, most importantly, safety. Chris Edwards states, “Any service that can be supported by consumer fees can be privatized. A big advantage of privatized airports, air traffic control, highways, and other activities is that private companies can freely tap debt and equity markets for capital expansion to meet rising demand. By contrast, modernization of government infrastructure is subject to the politics and uncertainties of government budgeting processes. As a consequence, government infrastructure is often old, congested, and poorly maintained” (Edwards, 2009). Presently nearly all major U.S. airports are owned by state and local governments and subsided by federal government funding renovations and/or expansions. History/Background The United States boasts having approximately 15,100 airports serving the aircraft trade according to reports from the CIA World Fact book in 2010. Of this number, only 5,000 have paved runways and 4,172 are in state ownership. There are currently 378 airports that service commercial flights in the United States and only one is privately operated, which is located in Branson, Missouri. Statistical data from 2005 reported 96.5% of the total passenger traffic in the United States flew from 138 airports. The Branson, Missouri airport opened in May 2009 and is the only privately owned, privately operated commercial

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