Private Airports Common Overseas

Published June 1, 2008

Private ownership and operation of major airports is the rule in much of Europe and Asia. The move toward privatization began in 1983, when the United Kingdom decided to sell 100 percent ownership of the British Airports Authority (BAA) in a public stock offering.

London’s three main airports–Heathrow, Gatwick, and Stansted–and four Scottish airports that had been operated by BAA were entirely private by 1987. Across Western Europe and parts of Asia, other governments have followed suit, partly or totally privatizing their formerly government-run airports.

The Indianapolis Airport Authority (IAA) in 1995 hired BAA to manage its airports–including Indianapolis International Airport, six general aviation airports, and the Indianapolis Heliport–on a contract basis.

The BAA contract with the Indianapolis Airport Authority ended last December–one year ahead of schedule–because BAA was purchased by another overseas firm whose corporate strategy calls for equity stakes in airports instead of management contracts, said Indianapolis Airport Authority spokesperson Susan Sullivan. IAA is now in charge of operations, using the same personnel BAA had employed.

“BAA offered a great deal of expertise in the area of developing new airport retail concepts and new revenue opportunities in our parking products,” Sullivan said in an email. “BAA was able to procure services as a private company without the added cost inherent in government procurement processes.”

Steve Stanek