Cost per Enplaned Passenger

1. Introduction

Cost per Enplaned Passenger (CPE) is the average airline payment per enplaned passenger at a given airport.

CPE provides only partial information about an airport's financial health and may wish to consider alongside other metrics such as breakeven CPE, percentage changes in airline payments, airline payments as a percentage of total revenues, and CPE as a percentage of average fare revenues. However, as it is applicable across airports, CPE remains a benchmark used across airports (FAA Form 127) for comparing airport cost levels.

CPE is calculated using the following formula:

CPE = Total Passenger Airline Payments / Total Enplaned Passengers

CPE is always expressed in nominal dollars (not inflation-adjusted) for the relevant fiscal year. as a CPE increase may reflect inflation, operational changes, capital programs, or a combination thereof.

2. What Is Included in CPE

CPE comprises airline payments across three operational areas of an airport:

Airfield Area

• Landing fees from passenger airlines

• Fuel flowage fees (where applicable; airport-specific)

Apron Area

• Aircraft parking fees

• Hardstand fees

• Jet bridge fees

• Ground power and Pre-Conditioned Air (PCA) fees

• Hydrant fueling charges (where paid to airport rather than third parties)

Terminal Area

• Terminal space rent (gates, holdrooms, ticket counters)

• Terminal user fees

• FIS (Federal Inspection Services) fees

• Customs and immigration fees

• International terminal fees (where applicable)

Excluded from CPE

• All-cargo carrier landing fees (reported separately)

• General Aviation (GA) payments

• Into-plane fueling paid to third-party fuel vendors

• Ground handling charges paid to third-party contractors

• Utility reimbursements and cost recovery charges (varies by airport definition)

Airport finance teams may evaluate individual airport definitions when assessing CPE, as scope and categorization vary across airports.

TABLE: CPE Components by Airport Area

3. Finding CPE Data

CPE data is available from multiple sources with varying reliability and completeness:

Reliable Sources

Audited Financial Statements: The management discussion and analysis (MD&A) section and statistics table of an airport's CAFR (Comprehensive Annual Financial Report) provide CPE data."In 24 of 31 large-hub airport CAFRs reviewed (2024), the statistics table includes a 10-year history of passengers and airline revenues."

Bond Official Statements: Consultant reports prepared for bond offerings include historical CPE and projections. These reports are detailed and prepared by experienced airport finance consultants.

Bond Rating Agency Reports: Moody's and S&P publish detailed analytical reports that include CPE analysis, historical comparisons, and peer benchmarking.

FAA Form 5100-127: Starting in Fiscal Year 2009, all large hub and medium hub airports file this form with the FAA. It provides a standardized, audited calculation of CPE, enabling direct comparison across airports without accounting methodology differences.

Less Reliable Sources

• Operating budgets (may contain projections rather than actuals)

• News articles and press releases (often incomplete context)

• Industry surveys and reports (varying methodologies)

4. Understanding CPE Calculation

4.a Recognizing Airline Revenues

A source of CPE variation across airports is how airline revenues are recognized and settled. Two mechanisms create distortions:

Ratemaking Methodology Impact

The methodology used to set rates (Residual, Compensatory, Hybrid Residual, or Hybrid Compensatory) directly determines the CPE level reported, even if the airport's underlying operational performance remains unchanged.

Example: The same airport operating under Residual ratemaking might report CPE of $9.00, while under Compensatory ratemaking the same airport would report CPE of $12.00. This $3.00 difference is entirely due to methodology, not performance deterioration.

TABLE: Ratemaking Methodology and CPE Impact

Year-End Reconciliation and Timing Distortion

18 of 31 large-hub airports using Residual ratemaking perform year-end settlement with airlines. Depending on whether settlement occurs in the same fiscal year or is transferred to the next year, CPE can vary by up to 120% (e.g., Airport A ($9.00 Residual) vs Airport B ($19.80 Compensatory) (FAA Form 127 FY2023)):

Example Scenario: An airport budgets $100M in airline revenues with 15M enplaned passengers, projecting CPE of $6.67. However, at year-end, the airport records only $80M in payments, with $20M owed to airlines as a credit (settlement refund). If the $20M credit is transferred to the next year instead of being recognized in the current year, reported CPE becomes $5.33 ($80M / 15M) rather than $6.67. This $1.34 per passenger difference is purely a timing issue — the same passengers and the same total costs, but $20M in airline payments is recognized in a different period.

Revenue Sharing and Settlement

23 of 31 large-hub airports report Net CPE (after revenue sharing adjustments) in their FY2024 CAFRs (based on published ACFR data). Understanding whether CPE is reported gross or net is important for accurate trend analysis.

Airport-Specific Definitions: ATL Example

Atlanta Hartsfield-Jackson International Airport (ATL) demonstrates how airport-specific definitions can complicate CPE comparisons. ATL reports both:

• City CPE: Calculated using only Airline Cost Centers (excludes terminal costs allocated to concessionaires)

• All-In CPE: Calculated using ALL airline payments, including terminal facilities and related costs

When analyzing ATL data, All-In CPE provides broader comparability across large-hub airports for consistency with other large hub airports and historical ATL comparisons...b Non-Airline Revenue Performance

Non-airline revenue performance depends on:

• Passenger volume and passenger mix (international vs. domestic, connecting vs. O&D)

• Terminal design and layout (efficiency of concession spaces)

• Market competition (proximity to alternative ground transportation)

• Concession contract terms and management

5.c Capital Program Phase

• Mature: CPE stabilizes at new baseline

5.d Enplaned Passenger Volume

Scale effects. e.g., COVID decline: 10% enplanement drop yielded 13% CPE rise at 25 large-hubs (FAA 127 FY2020) because fixed costs (administrative, maintenance, debt service) are spread across fewer passengers. Conversely, 10% enplanement growth reduced CPE by 8% at 25 large-hubs (FAA Form 127 FY2021-2023)

5.e Cost Structure and Geography

Regional differences in labor costs, weather patterns, facility age, seismic requirements, and environmental regulations create baseline differences in CPE:

• "50% above large-hub median" is. net, all-in vs. city)

  When CPE Comparisons ARE Appropriate

  • Same airport over time: Examining an individual airport's CPE trend is appropriate if the calculation methodology is consistent year-over-year

  • Peer group with full context: Comparing airports with similar methodologies and capital phases (e.g., mature hub airports using Compensatory ratemaking)

  • Projected vs. actual: Comparing an airport's official statement projections to actual results

  

  7. FY 2024 Actual CPE Data

  The following table presents CPE data for Large Hub airports based on audited financial statements and FAA Form 5100-127 data for FY 2024:

  Low CPE (<$10)	Moderate CPE ($10-$15)	High CPE ($15-$25)	$25+ CPE (>$25)
  ATL: $3.93	BWI: $10.57	MDW: $15.59	ORD: $29.56
  CLT: $4.74	FLL: $10.20	MIA: $16.83	LAX: $30.16
  LAS: $5.36	IAH: $10.66	SAN: $17.35	EWR: $31.67
  PHX: $7.81	MSP: $11.06	SEA: $18.24	SFO: $32.14
  DCA: $7.73	DEN: $12.76	HNL: $20.92	JFK: $36.01
  MCO: $8.18	IAD: $12.88	BOS: $21.72
  DTW: $8.88	DFW: $13.44	LGA: $23.20
  	AUS: $13.54

  TABLE: FY 2024 Large Hub Airport CPE by Category (Source: Audited Financial Statements (ACFRs) an