Transportation Network Companies -

Running head: TRANSPORTATION NETWORK COMPANIES 1
Transport Network Companies: San Francisco Airport
Student’s Name
Institution Affiliation

TRANSPORTATION NETWORK COMPANIES 2
Abstract
San Francisco International Airport located in California state is an example of an airport
that has permitted Transport Network Companies to access their airport facility with an aim of
providing customers with convenient transport services. While additional costs were incurred to
enhance the capacity of the airport to handle a higher traffic on taxi-ways in the airport, airport
has equally benefited from increased revenues generated in form of air-port-access fees levied to
drivers who accesses the facility. The airport management is encouraged to continue supporting
TNC operations and consider whether an additional flying route could necessitate a need to
construct additional taxiways to facilitate movement in the new onboarding facility.

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Transport Network Companies: San Francisco Airport
Introduction
The existence of Transport Network Companies (TNC) and the convenience with which
they present to their customers is a development that requires to be given consideration by
airport managers. Traditionally, customers used taxicabs, private vehicles and licensed commuter
buses to connect to and from the airport (Elgart, 2016). However, innovativeness in technology
has led to emergence of efficient ways that airport customers can get into and out of the airports
(Išoraite, 2005). There is a need for airport managers to determine how to accommodate the use
of Transport Network Companies (TNC) such as uber, bolt, amongst other TNC operators by
evaluating the opportunities and challenges associated with permitting the operators to access the
airport while dropping or picking customers (Miyoshi, Mason & Martini, 2018). This report
delved on evaluating how acceptance of TNC has affected the operational and financial
performance in San Francisco International airport.
Impact of TNC on San Francisco Airport Operations
The concern that the research wishes to address is how acceptance of TNC has influenced
decision-making by San Francisco International airport managers, and how those decisions
affects financial performance of the airport. Since the number of vehicles accessing the airport
was expected to increase, how did the management prepare for this? Most customers opt to use a
transport service that connects them from their door-steps to the airport or from the airport to
their door-steps (Ruiz, 2018). It was inevitable that the traffic within taxi-ways in the airport
would increase. In addition, the airport management needed to caution themselves of anticipated
rise in demand for additional packing space, as the number of vehicles accessing the airport
increased (Kumar, Dash & Sahu, 2018).

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With the increase in the frequency of vehicles entering and leaving the airport,
maintenance costs of taxi-ways would increase. In addition, there is a risk of TNC operators’
taking advantage of security in the airport and converting the airport into a packing ground for
their vehicles; unless the airport managers introduces airport-access-fee based on the amount of
time a driver spends in the airport. Coming up with airport-access-fee that is fair to the driver and
the airport may also pose to be a challenge (Martin-Domingo & Martin, 2015). However, some
TNC pass the burden of airport- access-fee to the customers if the requests for transport services
are made and the driver happens to be outside the airport (Martin-Domingo & Martin, 2015).
Results of the Research
Before San Francisco airport allowed the TNC to access the airport, the management
demanded that an agreement was to be entered between the airport and the Operator other than
with individual drivers. This control transferred the burden of vehicle identification, compliance
with the safety requirement as stipulated by transport regulatory authorities to the operators.
Upon the provision of the licenses to operate as TNC, the airport management agreed to allow
vehicles from the Operators to gain access to the airport (San Francisco Airport financial
statement, 2019).
The airport management sets aside a budget to cater for improvement of taxi-ways to
cater for the increase in the number of TNC dropping or fetching customers from the airport.
Secondly, the security personnel and the parking improvements costs are budgeted for with the
impact of TNC in mind. The airport management has also developed a system of billing TNC
based on the amount of time spent int the airport. This minimizes the possibilities of abuse of
parking service provided by the airport. In addition, there is a monitoring done using digital
process where vehicles are allocated specific parking lots to enhance security and minimize

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confusion that arise when drivers seek for parking spaces using trial and error approach ((San
Francisco Airport financial statement, 2019).
Discussion on the impact of TNC on Financial Performance
In the financial year 2018-2019, San Francisco airport had a total of 57.6 million passengers. The
audited financial report disclosed the make-up of the customers to be as shown in the table below
Passengers FY 2019 FY 2018 FY 2017
Total airport passengers 57,573,124 57,780,300 53,985,826
Enplaned passengers 28,620,387 28,813,851 26,871,412
Domestic enplaned passengers 21,301,043 21,955,031 20,513,891
International enplaned
passengers
7,319,344 6,858,820 6,357,521
Source: https://media.flysfo.com/Audited_Financial_Statements_FY2019.pdf
According to (San Francisco Airport financial statement, 2020), TNC makes up to 70% of paid
trips in San Francisco International Airport. Looking at the numbers in the table above, it means
that more than 40 million passengers who consumed San Francisco International Airport flight
services used TNC to either get into the airport or out of the airport. The revenues from packing
and transport within the airport in year 2019 was $166Million compared to $152 million in 2018.
The table below shows the revenue streams for the airport.
Revenue streams FY
2019"$000"
FY
2018"$000"
FY
2017"$000"
Aviation 565,635 670,282 545,310
Concession 161,889 158,594 149,697
parking and transportation 165,523 151,731 150,548
Net sales and services 87,396 83,195 81,245
Total operating revenue 80,443 1,063,802 926,800
Source: https://media.flysfo.com/Audited_Financial_Statements_FY2019.pdf
The increase in parking and transportation income was as a result rise demand occasioned
by use of TNC. 80% of the $165M was earned from parking fee. This, therefore means that TNC
has led to an increase the revenues earned by Francisco Airport. In line with the increased
number of taxi-way users, it was noted that the management had allocated $70 million dollars to

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cater for maintenance cost, parking improvement, security improvement and taxi-ways
improvement in year 2018-2019.
Conclusion
San Francisco International Airport has successfully embraced and supported TNC and
given them the right to access their airport facilities in order to promote convenience in delivery
of customer services. The airport management facilitated the process by demanding that the TNC
operators needed to have a license given by transport regulatory authorities. Further, the
management reinforced its security personnel, parking space and maintenance costs for the taxi-
ways as way of supporting TNC in delivery of services to airport customers. As a consequence,
the airport’s revenue from TNC airport-access-fee has risen over the years with an increase of
over $10 million between year 2017-2018 and financial year 2018-2019. The airport has,
therefore, gotten value from accepting to partner with TNC in its operations. It is recommended
that the airport management should continue supporting TNC operations as they have added
value to the business. Since most of the customers use TNC services, the management should
ensure that additional flight-routes from the airport are accompanied by an analysis of how the
flow of customers will influence the need to have additional taxi-ways that connects customers to
different onboarding facilities within the airport.

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Išoraite, M., (2005). EVALUATING EFFICIENCY AND EFFECTIVENESS IN TRANSPORT
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Martin-Domingo, L., & Martin, J. (2015). Airport Surface Access and Mobile Apps. Journal Of
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Media.flysfo.com. (2019). San Franscisco Airport Financial Statement. [online] Retrieved from:
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Miyoshi, C., Mason, K., & Martini, G. (2018). Enhancing the network efficiency: Air transport and
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10.1016/j.jairtraman.2018.02.001
Ruiz, T. (2018). Transport efficiency. Transport Policy, 67, 1. doi: 10.1016/j.tranpol.2018.02.011