Privatization of public "assets" collapse due to lack of money

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Airport Check-in: Chicago Midway won’t be privatized
By Roger Yu, USA TODAY April 26, 2009

Chicago’s plan to privatize Midway Airport has collapsed due to private investors’ inability to raise enough money amid the rough economy. Late last year, a consortium of investors, led by Citigroup’s Citi Infrastructure Investors, agreed to pay the city $2.5 billion for a 99-year lease, which would have made Midway the first major domestic airport to be privatized.

Chicago’s latest announcement comes less than a month after the city and the investors, which also include YVR Airport Services and John Hancock Life Insurance, revealed that they would need more time to finalize the transaction given the tightened credit market.

Chicago Midway was one of the earliest applicants for the federal experiment to allow privatizing up to five U.S. airports, only one of which can be a hub.

Chicago may still resurrect its privatization plans “when the market conditions improve,” spokesman Pete Scales says. “But who knows when that is? We don’t have a time frame when we might issue a request for proposals.”

Under the agreement, Chicago will still keep the $126 million letter of credit it received from the investors.

World’s best airport

Incheon International in South Korea is the world’s best airport, according to the Airports Council International’s latest annual survey. This is the fourth consecutive year that the 8-year-old airport, about 30 miles southwest of Seoul, has won the trade group’s top “Airport Service Quality” award.

ACI didn’t specify why the airport won the award, but Incheon’s press release touts its Airstar mall of stores (which includes an Internet lounge, a sauna and a transit hotel), “top-quality shopping facilities” and “various cultural and artistic events.”

Singapore, Hong Kong, Central Japan Airport near Nagoya (also known as Chubu Airport) and Halifax round out the top five. In the North America category, Austin ranked third, the highest among U.S. airports.

• SuperShuttle International, the largest airport shared-van company in the USA, says it will begin service at Pittsburgh International on May 1.

• Chicago O’Hare lost the highest percentage of travelers in 2008 among the 10 largest domestic airports, according to the Department of Transportation’s Bureau of Transportation Statistics. O’Hare’s scheduled boardings fell 8.3% to 31.3 million. Other large airports that saw fewer travelers in 2008: Las Vegas (-6.9%); Phoenix (-6.5%); Los Angeles (-5.9%); Dallas/Fort Worth (-4.6%); and Houston Bush (-4.3%).

Atlanta Hartsfield, whose traffic rose 1.2% in 2008, remains the busiest airport in the world, with 43 million travelers. Denver replaced LAX as the fourth-busiest airport in the USA in 2008.

In 2008, the number of scheduled domestic and international passengers on U.S. airlines and on flights to and from the USA on foreign airlines fell 3.5% to 809 million.


• Delta will begin non-stop flights to Dallas’ Love Field starting July 6. The carrier will offer three daily round-trip flights between its Memphis hub and Dallas’ downtown airport.

• US Airways has resumed service to Paris Charles de Gaulle from its Charlotte hub after an eight-year hiatus. The seasonal service, flown on Boeing 767 aircraft, will operate daily through Oct. 24.

• JetBlue says it will launch four daily non-stop flights between Boston Logan and Baltimore/Washington on Sept. 9. The move comes shortly after Southwest, a JetBlue competitor, announced that it will start flying the same route later this year.

JetBlue also plans to start daily service from New York John F. Kennedy to Barbados on Oct. 1, adding to its growing number of flights to the Caribbean.

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