Table Of Contents - Chicago Transit Authority

CTA Express Airport Train Service Business Plan
sales. Airlines have access to most potential premium airport train customers and could encourage
their passengers to use the premium airport train through discount arrangements.
As airlines face increasing cost and competitive pressures, they may be reluctant to make large
investments, but at the same time they may be more willing to enter into partnerships if they stand
to benefit. It is important that there be a financial incentive to airlines in order to benefit from their
cooperation, particularly because the premium airport train could lead to lost revenues for the airline.
For example, an airline executive explained that the airlines at O’Hare share revenues earned from
airport parking, which could possibly be impacted with the implementation of the premium airport
train service.
• Hotels - An important target market for the premium airport train will be visitors staying at
downtown hotels. The majority of hotel occupants will be traveling through Midway or O’Hare and
therefore represent potential premium airport train customers. Targeting hotels with multiple
downtown locations that attract business travelers could be particularly valuable. A relationship with
hotels would allow people to be informed of the service, by ensuring that concierge staff is
knowledgeable and able to provide information to customers.
Hotels may be willing to include information about the premium airport train service on their websites
when providing customers with transportation information. Hotels may also present an opportunity
for ticket sales. Heathrow Express in London and Brisbane’s Airtrain in Brisbane, Australia both offer
discounted tickets to hotel concierges for them to sell to guests at regular price. Discounts or
commission payments for third-party sales typically range from five to 15 percent of the ticket price,
and could be coupled with volume agreements.
• Convention and Tourism Agencies – A strong relationship with the various convention agencies
that work in partnership for Chicago would be extremely valuable for CTA in gaining access to the
premium airport train target market. Cooperation with conference agencies could include joint ticket
sales. For example, premium airport train tickets could be offered for sale to attendees at the time of
registration, or alternatively an advertisement or information could be provided. Joint marketing may
include agency logos and website hyperlinks included on their own and related third-party websites.
4.4 PRICING
4.4.1 Pricing Philosophy
Fares for the Direct Service should, at a minimum, enable the operator to cover direct operating and
maintenance costs. Although maximizing revenue is a central concern, pricing should also consider CTA’s
ridership objectives, especially if the revenue maximizing fare reduces ridership below a threshold where
the service is viewed negatively. Section 7 discusses the financing capacity associated with different fare
levels in further detail.
Based on other premium international airport rail link services, the suggested base price range for the
Express Service is from $12 to $17 for the trip from the downtown station to O’Hare airport, and from $9
to $13 to Midway airport. The suggested price levels consider the following:
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