Québec, February 26, 2018 – Every year, the Air Transport Research Society (ATRS) conducts a study, the Airport Benchmarking Report, in which they claim to measure the efficiency of over 200 airports around the world. Renowned economist Michael Tretheway contends that the study has no scientific credibility both for its methodology and its report filled with “fatal errors.” For several years, the study’s results have been an “erroneous” and “highly controversial” cavalcade of slurs against the Jean-Lesage International Airport (YQB).
“It is particularly unfortunate and damaging that this study has been granted such importance in the public arena,” mentioned Michael Tretheway, chief economist and strategic director at InterVISTAS in Vancouver.
Mr. Tretheway’s observations are fundamental since he himself drafted the methodology now being misused by ATRS in its classification exercise. Other researchers around the world have also criticized the ATRS methodology.
An “imperfect” and “poorly executed” comparison
“ATRS has made unfair comparisons: In sum, ATRS is inappropriately comparing YQB to airports that are dramatically larger and with no adjustments being made for key cost elements that are beyond the control of YQB management such as rent, property tax, safety and snow removal. The ATRS comparisons of YQB are dubious, at best,” mentioned Mr. Tretheway.
To illustrate his claims, Mr. Tretheway observes that:
- The key methodology used by ATRS to evaluate airport efficiency ignores the capital costs made by each airport; these costs are highly important in this industry, particularly for YQB.
- The peer airport comparisons of the ATRS benchmarks are not meaningful. The study fails to understand and control for critical differences between YQB and the peer airports that ATRS uses. For example, most of the peer comparator airports are American, but these do not pay any rent or property taxes and have access to significantly lower borrowing costs through municipal bond financing. Simply adjusting for the property tax and rent payments that YQB must pay would narrow or eliminate much of the gap.
- From a Canadian perspective, the study does not take into account that YQB’s property taxes per passenger are the second highest in the country.
- Only one other airport in Canada receives more snowfall than YQB, but this consideration is not taken into account in the ATRS study, even though snow removal represents major extra expenditures for YQB.
- The ATRS study is replete with data errors. For example, the average wage at Chicago’s Midway airport is higher than the U.S. President’s official salary. As the author puts it, “Further, these errors seem to persist for years before being corrected, if corrected at all. This is suggestive of data development and analysis that is mechanical, without common sense checks.”
All “these omissions, […] stack the deck against YQB which has been severely challenged in inheriting an airport with inadequate infrastructure, must pay rent (which increases as it invests more, […]), must pay property taxes, operates in a cold climate, and inherited a terminal with limited opportunity for commercial revenue developments. The ATRS finding of low efficiency for YQB must be set aside as it fails to consider any of these cost-increasing aspects of YQB.”, wrote the researchers.
“Conclusion: it is pointless to compare between different airports. They should be compared to themselves. In this regard, YQB is performing particularly well with some of the most impressive growth figures in Canada,” said Mr. Tretheway.
Year after year, Transport Canada acknowledges the sound management and good governance reigning at YQB. A dozen reputable Canadian financial institutions have entrusted it with $315 million in financing for its development, thereby endorsing its vision for the future.
YQB’s patronage has been growing steadily over the past 15 years. In 2017, the number of passengers that transited through the airport grew by 3.4%, reaching a high of 1,670,880 passengers, or 55,000 more than the year before, despite the upgrading of the main landing strip which limited big carriers access for several weeks.
“On reading Mr. Tretheway’s report, we deplore having been evaluated on the basis of an unfounded methodology that ignores the most elementary economic principles and uses incomplete and inaccurate data. It was high time conclusions based on false premises were finally discredited by competent experts. We can now focus on what really matters: providing a memorable passenger experience,” commented Aéroport international Jean-Lesage de Québec CEO Gaëtan Gagné.
About Aéroport de Québec inc. (YQB)
YQB is the private corporation responsible, since November 1, 2000, for the management, operation, maintenance and development of Québec City Jean Lesage International Airport (YQB). Around a dozen carriers use YQB to offer connections to North America, Central America, the Caribbean, Mexico and Europe, and daily flights to the main hubs in eastern North America.
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Aéroport de Québec inc.
Phone: 418 640-2700, extension 2625
 Michael Tretheway is currently Chief Economist of the global aviation consulting firm InterVISTAS Consulting Inc., and was professor of Transportation and Economics at the University of British Columbia (UBC). Note that Mr. Tretheway had already castigated the ATRS study as early as 2006.