Why Does Airport Pickup Cost More?

(Photo: Alquiler de Coches)

(Photo: Alquiler de Coches)

We are arranging a car to take us from our flat to Heathrow Airport early Saturday morning, then return us on Monday evening.  The price going to the airport is ₤28, the price returning is ₤38.  Why the difference?

One possibility is cost-based price discrimination: the driver may have to wait at Heathrow, since the plane and retrieving our baggage may be delayed.  Another is that the prices are set to match the differential set by metered taxis to reflect waiting time for fares at Heathrow (although I would think that competition among car services would eliminate that differential).  I don’t see how this differential could arise from demand-based price discrimination; and neither of the other explanations seems very satisfying.

(HT: DA)


Deviant Ollam

Interestingly, here in Philadelphia the city has a "flat fare" option of $28 (you are free to ask the driver to go by the meter instead if you wish) and that price applies either to or from the airport.

Jim

Some cities impose a surcharge (i.e., tax) on livery services for pickups at the airport. They can't effectively charge it going TO the airport because many pickups are not within the city limits. By imposing it at the airport, they can charge both city residents and suburbanites, but they would not want the bad public image associated with charging only city residents for the trip to the airport. Also, since many area residents get dropped off or picked up by friends/family, they are effectively externalizing their tax because it will be paid disproportionately by tourists.

robbert-john

Normally an airport is away from the city and isolated, therefore it's a destination for the drivers that doesn't provide any work other than there. it's a risk they take, that has to be rewarded. At least that's my opinion

mark

This doesn't really answer the question, but any time I've gone to an airport (Los Angeles Intl or the smaller Ontario airport), the price to and from has been identical.

Perhaps this is a regional/country-specific occurrence?

Mark

It might be partially explained by the fact that the cab will certainly find its next fare seconds after dropping you off at the airport, while its prospects for getting a new fare after dropping you off at home are uncertain.

Chocolate seller

+1

Roger Wade

I don't know specifically about London, but airport taxi surcharges are very common all around the world. The taxi company has to pay a fee for picking someone up at the airport, but not for dropping someone off. Still, I've never seen an airport tax this high (although UK airport taxes on airline tickets are also among the highest in the world).

Chicago

Here in Chicago, cab rates are an extra $2.00, for all trips to and from the airport. Interestingly, train rides from the airport incur an extra charge as well (I think it's $5.00) unless you are an employee. I imagine they would charge extra for going to the airport as well if they had the technology (Chicago currently does not make you swipe transit card on exit).

Also, anecdotal evidence for demand imbalances between going to or from the airport. My case might be different, but I always take the train to the airport and 90% of the time take a cab back. The reason for this is that I usually fly out in the evening after work, and so it's more convenient for me to take the train; the train is faster than cab during rush hour; and also it's an excuse to leave work well in advance of the flight. On the way back, I usually land at odd, non-traffic-jammed times, and I just want to get home as quickly as I can with minimal effort -- don't really want to deal with switching trains. So then I'm willing to pay the extra $$ for the cab just to get home after a tiresome trip.

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Michael Risch

There could just be airport departure taxes.

dave

San Francisco taxis have a $2.00 airport surcharge plus a 50% increase on the metered rate if you head south and go further than 15 miles.

http://www.sfmta.com/getting-around/taxi/taxi-rates

Jadrian

I can see it as a demand based price discrimination because you have more time to prepare for a trip to the airport (the Tube, friends, bus, etc). The same may not be entirely true on the way back, like you mentioned above with delays. If my flight is delayed, I've inconvenienced friends or the bus route has already passed.

People also typically seem pretty accepting to take their time to get to the airport early (and usually with time to spare), but are in a hurry to get home when they're done. The extra ₤10 must be the price people are willing to pay to go home immediately and avoid the Tube.

Tupac Chopra

Demand is most likely lower going to the airport than returning from it. If I need to go to the airport, I have the choice of driving myself there and paying the long term parking rate. Presumably, people prefer the luxury of driving themselves and driving back on their own schedule rather than taking a cab.

Given that I have the alternative to drive myself, I have a lower maximum price I'm willing to pay and taxi firms are charging close to that price. On the other hand, if I am looking for a cab at the airport, I most definitely do not have my own car parked there. Since I have fewer alternatives, the taxi firm can afford to charge more.

Aadi104

When one is booking a cab to the airport, then one does it usually from his/her comfort zone(home/office etc.) where one has comparatively more time and options to research and get the best deal to reach the airport. The competition is comparatively tough here.

But when one needs a cab back from the airport, then the hurry to get home, weariness of the travel and lesser number of options at the airport give an opportunity to cab companies to charge more for the same travel back home. And we are ready to pay it, just get me home.

Ben Parker

It is free to drop people off at Heathrow airport. To park at arrivals costs, plus there is waiting time.

Charlie

I believe it is that there is a taxi toll when they leave the airport. It is not obvious, but after a taxi drops someone off, they have to circle around, pay a toll and get into a queue to be permitted into the "arrivals" area to pick someone up. This I believe is set up by each municipality or airport and is a revenue generator similar I am guessing to hotel/tourist taxes. In this case, the taxi just adds it to your charge when you leave the airport as it is closest to when they had to pay it.

Alain Romero

I'd recommend Uber.

jane

Airport pick up is usually more expensive because cab drivers get to pray on first-time visitors, who don't know the local market rates, do not have other options to get into the city, and otherwise are not in a position to choose services or negotiate prices.

This situation causes airport pick up to be more expensive even for those who are well-informed and prepared to request a better deal, because they are competing for services with a population that is willing to pay more.

p.s.
Cities often set the maximum price for airport pick up that cabs are allowed to charge, specifically to protect uninformed visitors from being taken by unscrupulous drivers. The max price immediately becomes the minimum price cabs are willing to accept, because no one is willing to charge less - and there is an anchor price everyone can easily agree on.

Matthew M.

Simple. To pick up from most airports the driver/operator must pay an 'airport fee’ (often imposed through tollway like transponders.) Taxi meters accomodate this difference in rate and zone rates will bury the fee.

The nasty offenders are when public transit gets in the ‘act.' In Vancouver BC, purchasing a single-ride fare that leaves the 3 airport train stations incurs a $5 surcharge. This is offensive when most fares are $2.75 to $5.50, making this a 100-250% surcharge. It’s almost cheaper to take a taxi cab to the nearest station outside the airport and ride the train from there.

James

Toronto requires taxis picking up fares at the airport to obtain a license and pay a toll.
Any taxi can drop you off at the airport, but only those obtaining the license and paying the toll are allowed to initiate a fare at the airport.
Perhaps London has the same?
Interestingly, a culture of unlicensed "scabs" has developed.

Ethan

More consumer choice in methods of reaching the airport - if you're considering a cab to get home from the airport, you likely took a cab to get there initially. There is guaranteed demand for cab rides home, but not for rides to the airport.