Pact cuts costs for airlines at Indianapolis International

Back to TopCommentsE-mailPrintBookmark and Share

A new financial agreement with airlines using Indianapolis International Airport was approved Friday morning, settling what had been a fractious battle with airlines that had complained about having to foot part of the bill for FedEx Corp.’s local expansion.

Total costs in rents, landing fees and other charges for airlines are set to decrease over the five-year term of the agreement, according to the Indianapolis Airport Authority. Cost per enplaned passenger will gradually fall to $8.86 in 2015 from $10.50 this year.

The cost-per-enplanement had been estimated at $13, previously.

The airport said it will reduce its capital improvement program by $150 million over the term of the agreement as part of a cost-containment strategy.

“”We believe this agreement demonstrates our door is wide open for continued dialogue with airline executives about new and expanded air service in Indianapolis, especially to key West Coast markets,” Marsha Stone, chief financial officer of the Indianapolis Airport Authority, said in a statement.

According to the agreement, a landing fee of $1.95 per 1,000 pounds is forecast to drop to $1.80 by 2015 instead a previously projected $2.15.

 The new fee structure “helps ensure the continued success of FedEx,” the authority said.

FedEx’s Indianapolis cargo hub was at the center of what could have been disasterous outcome for the airport.

As IBJ previously reported, Northwest Airlines, Delta Air Lines, AirTran Airways, Continental Airlines and Southwest Airlines filed a complaint against the airport authority with the Federal Aviation Administration in 2007.

They alleged the FedEx expansion at Indianapolis could cost them an additional $23 million in landing fees through 2028.

That’s because the authority promised to reduce landing fees for FedEx at the same time it committed to spending $49 million for a new aircraft parking apron at the company’s hub.

The FAA dismissed the airlines' complaint in August 2008, but did so in part because it said the issue wasn’t yet ripe for FAA review. It noted the authority had yet to impose on airlines the costs related to the FedEx expansion.

Among other nods to airlines in the new airline agreement is cutting the term in half, to five years. Terminal rent remains constant at $95 per square foot. The airport authority also pledges to shave its operating and maintenance costs by $65 million.



  • Curious too
    Is this why airline service here is so wretched?
  • $215 Million Question
    Interesting that the FedEx cargo-hub expansion cost was $214 million.

  • Question
    How is the airport going to shave $215 million in maintenance/operating/CAPEX expenses? What is being eliminated?

Post a comment to this story

We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
You are legally responsible for what you post and your anonymity is not guaranteed.
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
Subscribe to IBJ
  1. Yes sir keep cashing those 300K a year checks direct to IMS, while millions disappear from the teams like Rahal's. Guess there wasn't enough ka- ching going around to keep Sarah Fisher in business without their "merger". LOL._____.Meanwhile back in Realville the series with the "best racing in the world" drew what appeared to be about 5000 live spectators ( and probably 1500 of those Target "freebies", and was beaten in the ratings by a series that reportedly consists of "parades" and aired while most people are still sleeping. That will generate those big ka-chings for sure. :-). But, hey, as long as the Speedway gets the cash who gives a damn about the teams?

  2. Welcome to PETERSON LOAN AGENCY Company (A Personalized Service for All Your Financial Needs) We, Liberal Investment Company Providers offers loan at a very low interest rate of 2%, we offer Personal loans, Debt Consolidation Loan, Venture Capital, Business Loan, Educational Loan, Home Loan, and Loan for any reason and urgent needs!. with a maximum duration of 30 years. Have you been turned down by your bank? Do you have bad credit? Do you have unpaid bills? Are you in debt? Do you need to set up a business? Worry no more as we are here to offer you a low interest loan. Our loan ranges from $5,000-USD (Five Thousand US dollars) to $50, 000,000.00.(Fifty Million US dollars). We also lend in USA DOLLARS EURO and POUNDS ! Fill in this form and forward it to our email: PETERSONLOANAGENCY@GMAIL.COM 1. Your Full names:_______ 2. Contact address:_______ 3. Country Of Residence:______ 4. Loan Amount Required:________ 5. Duration:_____ 6. Gender:_____ 7. Occupation:________ 8. Monthly Income:_______ 9. Date Of Birth:________ 10.Telephone Number:________ 11. Purpose of loan:_________ Yours In Service, MR PERRY, PETERSONLOANAGENCY@GMAIL.COM

  3. If I could actually get the prices...I would do this on my own. We need laws that force provides to publish the costs they will charge. Everyone else gives you the price in advance...except hospitals.

  4. I was under the impression that fencing is not allowed on a front yard and that on a corner, both sides are considered "front" yards, therefore can't be fenced without a variance. Also impedes the visibility for drivers at the intersection. Am I understanding this correctly? Might be why a fence was not included in the plans and a request for a variance will have to be made?.

  5. I was a big fan of Cowards and Carrots, which I got a chance to see at the show. It's currently on Kickstarter, but the designer also put out What's He Building in There last year, which got a fair amount of buzz.