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)


Martin

At Heathrow, there is no charge to drop off a passenger - the driver just picks you up at your flat, drives to the airport, and then drops you and moves on to their next job. However, to pick them up the driver needs to park up before your flight lands and wait for you to come out. The driver has to be there from the time the first hand luggage only passenger is out to the time the last oversize luggage passenger, which can be a difference of an hour, all the time racking up parking fees (at Heathrow, 30 mins parking is £3, 1 hour is £6, and so on.) Plus, while they are waiting, they aren't earning money on other jobs. When you look at it like that, a mere £10 difference to pick up at the airport is a bargain.