DEVELOPMENT OF PRICING STRATEGIES FOR AIRPORT PARKING : A CASE STUDY AT SAN FRANCISCO AIRPORT

Abstract

This paper considers the development of parking pricing strategies for international airports. Using the characteristics of parking demand at an airport, parking rate structures can be determined to meet given objectives, such as the maximization of consumer surplus, supplier's surplus or total surplus. A case study of San Francisco International Airport is used to illustrate this. The demand for parking by different duration groups is defined with data obtained before and after a parking rate change. Alternative pricing structures are explored. It is found that a concave type block rate structure will generate greater profits but less total surplus than a uniform rate structure. By contrast, a convex-type block rate structure will generate a larger total surplus but smaller profits than uniform parking rate.