Transport Airports

Chicago Will Not Turn Over Midway Airport to a Private Company

Sep 06, 2013 7:29 am

Skift Take

Privatization of transport does not guarantee success — just as British rail passengers — but many U.S. airports need something to improve the poor municipal management they currently are stuck with.

— Jason Clampet

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Patrick Giblin  / Flickr

Passengers and Blues Brothers statues at Chicago's Midway airport. Patrick Giblin / Flickr


Citing a lack of competition that wouldn’t benefit taxpayers and travelers, Chicago Mayor Rahm Emanuel halted plans to lease Midway International Airport after one of the remaining two bidding groups backed out.

Emanuel’s decision comes after the city picked two finalists for a lease. The 53-year-old Democrat announced in December his plans to explore such a transaction, reviving an idea that died in 2009. The airport is Chicago’s second-biggest, behind O’Hare International.

A bidding group consisting of Ferrovial SA and Macquarie Group Ltd. was the only one remaining after a consortium of Industry Funds Management of Australia and Manchester Airports Group Plc withdrew, according to Sarah Hamilton, a spokeswoman for the mayor. The lack of competition led to Emanuel’s decision, she said.

Spain’s Ferrovial, the largest stakeholder in Europe’s busiest airport, London Heathrow, had teamed with Macquarie’s infrastructure arm in a group called Great Lakes Airport Alliance. Ferrovial operates the Chicago Skyway, a toll road on the south side of the third-most-populous U.S. city about six miles (9.7 kilometers) from Midway.

The Midway lease, which initially drew six bids including from Gatwick owner Global Infrastructure Partners, was part of a wider U.S. Federal Aviation Administration pilot program to privatize airports and spur infrastructure investment. Southwest Airlines Co., the biggest low-fare carrier, dominates the volume of flights at Midway.

Editors: Stacie Sherman, William Glasgall. To contact the reporters on this story: Brian Chappatta in New York at bchappatta1@bloomberg.net; Tim Jones in Chicago at tjones58@bloomberg.net. To contact the editor responsible for this story: Stephen Merelman at smerelman@bloomberg.net. 

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