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AIRPORT PROFILES Last modified on January 9, 2014

Fantastic journey

San Francisco International Airport’s long-serving boss, John Martin, talks to Joe Bates about infrastructure development, traffic growth and his gateway’s impressive green credentials.

For many, the highlight of the last 15 years at San Francisco International Airport (SFO) is likely to be the 2000 opening of its giant and still eye-catching International Terminal.

The distinct facility with its impressive glass façade, spacious lobby and rail station is still the largest international terminal in North America and provides a fitting welcome to San Francisco for nearly one million passengers that pass through the gateway on international flights each year. 

“It has stood the test of time well and much better than some of the rest of us,” jokes airport director, John Martin, who oversaw its construction and opening in the early days of his leadership.

“Its opening as the major project of a $3 billion construction programme was a major milestone for the airport. It is a very efficient building and changed the way we operated and the services we could provide. The airport has always been good at customer service. When we opened the international terminal, we became great.”

But these days you simply cannot talk about SFO without thinking about Martin, the airport’s longest serving aviation director after clocking up 18 years in the hot seat, its new-look Terminal 2 or highlighting one or two of its impressive green credentials.

Sense of place

 

The modest Martin doesn’t often speak about his longevity at SFO because he doesn’t really like talking about himself. It is, however, something he is very proud of, and his love for the city, culture and its people clearly came across in my time with him.

Indeed, Martin has gone out of his way to create a ‘sense of place’ at SFO and ensure that “little pieces of San Francisco” can be found throughout his gateway in the shape of familiar shops, restaurants and services.

These have included opening versions of popular downtown shops and restaurants in its terminals and encouraging local artists to display their works as part of its long-established public arts programme.

Martin notes that he is actually a big supporter of ‘pop-up’ shops, and reveals that one of the reasons behind this is because he feels that they provide an inexpensive way for small, local businesses to come in and test the market. 

“It is an ideal way to see if it is right for them before possibly setting up a permanent outlet,” enthuses Martin. “We have a retailer who started out with a little chocolate truck 30 years ago, and now has four large retail locations across the airport.

“This is the sort of thing we want to encourage, as it helps local businesses and helps create a sense of place.”

After car parking and rental car activity, which together make over $160 million in revenue per annum, concession income is the next biggest revenue earner for SFO – duty free sales bring in $27 million per annum alone and F&B around $10 million.

In fact, SFO’s spend per passenger is one of the highest in the US, with the average customer in Terminal 2 spending around $14.50, an impressive total for a domestic facility.

History in the making

Talking briefly about his long association with SFO, Martin says: “When I took the job in 1995, never in the world did I think I would still be here 18 years later! It’s been an extraordinary ride with an extraordinary team. 

“It’s the people that keep me here. We have a great culture where everyone who works at the airport is really committed to providing service and facilities.”

He notes that how he spends his time has changed dramatically since the early days, when he was preoccupied with construction of the biggest public works programme in the US [the International Terminal, extending the Bay Area Rapid Transport (BART) system to SFO and new parking garages].

“The first six years was all about keeping the airport open during construction. Then came 9/11 and things changed radically,” explains Martin. “We suddenly lost 40% of our traffic and the focus was very much on cost-cutting, maximising our concession revenues while maintaining customer service levels and getting new air services into the airport.”

Cost-cutting included laying off nearly 30% of his staff at the San Francisco Airports Commission, about 130 people in total, which Martin says was a “tough but necessary business decision to keep SFO’s cost structure down”.

The situation was not helped by United filing for bankruptcy in the aftermath of 9/11 or the fact that Southwest Airlines had pulled the plug on services to SFO and moved to Oakland six months before the terror attacks, citing the airport’s high costs as the reason for its exit.

Martin is the first to admit that these were difficult days for SFO, which had little low-cost carrier traffic at the time, so saw its traffic figures drop from an all-time high of 41 million in 1999 to 26.5 million in 2002 before starting the long road to recovery.

“Attracting low-cost carriers became a huge marketing emphasis for us and landing Virgin America in 2007, which is headquartered in San Francisco, was a huge deal for the airport in terms of our traffic recovery,” recalls Martin.

Indeed, Martin goes as far as to say that the 2007 arrival of Virgin America was “a game changer” for SFO, pointing out that whenever the carrier enters a new market, airline fees on average drop by around 25% and traffic rises by 22%.

“JetBlue and Southwest soon came online, fares dropped and passenger numbers began to increase. As a result we’ve been one of the fastest growing airports in the country in the last five years,” he says.

“So, you could say I’ve seen the good times, the bad times and the great times during my time at San Francisco.”

Greatest achievements

What does he count as SFO’s greatest achievements under his leadership?

Without hesitation, Martin states that he is most proud of building a corporate culture where the employees are dedicated to providing exceptional service.

Adding: “On a physical level, the opening of the International Terminal – which is still very much the centrepiece of the airport and will be for years to come because of international traffic growth – is the highlight, closely followed by Terminal 2.

“I am also very proud of our record when it comes to the environment and sustainable development.”

Although he didn’t mention it, reducing SFO’s costs per enplanement by 30% over a four year period was also a significant achievement.

He also gets great satisfaction from the recent upturn in passenger traffic at the airport. In fact, such has been SFO’s growth in recent years that the airport equalled its previous best annual total of 41mppa in 2011, and handled a record 44.5 million passengers in 2012.

Green issues

If Martin is reluctant to talk about himself, he is exactly the opposite about SFO’s environmental record, as he believes that the airport is one of greenest in the US and a considerate neighbour to surrounding communities. 

The gateway’s environmental roots can arguably be traced back to 1995 when it decided to build today’s AirTrain people mover system to eliminate the need for rental car buses, and start introducing CNG-powered ground support vehicles.

He lists the fact that SFO composts 77% of its waste products; that all new buildings have Gold or Platinum rated Leadership in Energy and Environmental Design (LEED) certification; and that the airport’s CO2 emissions are 34% below its 1990 levels, as the highlights of SFO’s green achievements.

SFO’s commitment to the environment extends to insisting that all door-to-door vans, hotel shuttle buses and taxicabs serving the airport use green fuels. 

And it has shown the way by converting 60% of its own fleet of vehicles to alternative fuels and is aiming for 100% within the next few years.

“The culture of our organisation is that we want to make net contributions to the environment. We want to be an environmental leader and our staff embrace this philosophy and genuinely want to go home and tell their kids that we are a green pioneer,” says Martin.

“We have been doing this for a long time now, so it is not a passing fad or something we are doing to win political favour. We also like to share our environmental knowledge and standards with other airports so that they can benefit from our experiences.”

ACI-NA recently honoured SFO with its Environmental Management Award for its Climate Action Plan, in recognition of its efforts to reduce its annual greenhouse emissions.

 

People power

On the SFO website, Martin claims that he loves the pride his staff and the public have in the airport.

This is certainly something that the airport commission has worked on over the years, according to Martin, who recognises that this is not the case everywhere.

“I believe that our people, SFO’s airline customers and concessionaires take real pride in providing exceptional levels of service to customers and the airport’s reputation for breaking new ground in environmental achievements, security and customer service.

“We have worked hard to create a sense of passion and commitment for the mission. We work with our employees to create a vision for the airport. It is not my vision, it is the vision of the airport staff and the organisation. The high-level goals are not my goals, they are ones created by my staff. They have a buy-in, and ownership if you like, to make the airport truly exceptional.”

Strategic plan

He is quick to point out that much of SFO’s ‘Reaching for No.1’ strategic plan is based on feedback from staff during committee meetings, which looked at ‘best practice’ initiatives across the world and how they could be adopted and developed at the airport.

In Martin’s words, the catalyst for the plan was the need for SFO “to re-envision itself” and “set a new vision, mission and goals for passenger services, security, safety and the working environment for employees.

“Basically, our vision is to be an exceptional airport and service for our community,” he tells Airport World. “We want to be one of the world’s top rated airports for customer service. We want to be a great place to work and an environmental leader among airports.”

Arguably, SFO has already achieved at least one of these goals after being named ‘The healthiest place to work in San Francisco’ in a San Francisco Business Times survey, beating mighty competition on the way such as Oracle and Google.

A key factor of the strategic plan, according to Martin, was the introduction of a new “guest service mentality” in a bid to enhance customer service, and ultimately satisfaction levels.

He explains: “We want to treat passengers as not merely our customers but as our guests. This has meant learning from the hotel visitor industry and adapting things that it does well, such as concierge services, to the airport environment. 

“It has also meant providing amenities and services that exceed expectations, such as Terminal 2, which offers the facilities and services you would expect to find in a trendy hotel in downtown San Francisco, but not at a busy international airport.” 

 

New infrastructure

Martin calls the newly renovated Terminal 2, redesigned to fit the business model of Virgin America and fellow occupant American Airlines, “something special”.

Its $383 million upgrade actually resulted in the facility becoming the nation’s first LEED Gold-registered terminal and one of the most modern and sustainable facilities in the US – a remarkable achievement of a complex that originally opened for business in 1954.

Today’s new, improved 640,000sq ft version – designed and built through a partnership between Turner Construction and Gensler (associate architects are Michael Willis and Hamilton-Aitken) – boasts 14 gates, 30,793sq ft of retail and concession space and the capacity to handle up to 5.5mppa.

Martin believes that some of the services and facilities that help T2 “break the mould” are its local foodcourt with offerings from celebrity chefs, Tyler Florence and Cat Cora; dozens of works of art from local and international artists; a children’s play area; “luxurious” restrooms; free Wi-Fi and laptop plug-in stations; club-like seating near the gates; and ‘dehydration stations’ where visitors can refill water bottles.

He reveals that the challenge ahead for the airport is to do even better in the soon-to-be completed Boarding Area E expansion of Terminal 3. 

The upgrade of the old American Airlines area of Terminal 3 – part of the next $5 billion development phase at SFO – is actually due for completion in January 2014, allowing for United to move in and work to start on the phased multi-year remodelling of the rest of the terminal.

When finished in 2020, the new-look Terminal 3 will become United’s base at SFO and have facilities such as a single new central security checkpoint, a range of new concessions and some of the customer friendly facilities found in T2.

Also on the agenda under the 10-year master plan are proposals to tear down and rebuild Terminal 1, and enhance SFO’s appeal to transit passengers with the construction of a new four-star hotel in front of the International Terminal.

Like at DFW with the Marriott/Hilton, SFO plans financing and building the hotel itself and then awarding a long-term operating lease to a well-known hotel chain. The 10-storey, 450-room facility will be built on the site of an existing car park.

Another addition will be a new air traffic control (ATC) tower, which is currently being built between terminals 1 and 2. The complex is expected to open in 2015 and replace the existing tower on top of T2 that has served SFO since 1954.

Martin notes that the airport is also planning to improve the retail and F&B programme in the International Terminal with more unique offerings, while simple things such as piping music into restrooms is expected to enhance its overall ambience.

On-time performance

One thing that isn’t on the cards is a new runway – Martin laughingly notes that he tried to get one 15 years ago – although SFO has high hopes that the delays caused by low cloud and fog on 30% of all mornings will be reduced by the recent introduction of new FAA-approved arrivals procedures.

Indeed, Martin says the procedures – that effectively mean SFO can still use both parallel runways for landings during low cloud – could eventually boost the airport’s arrivals capacity by up to 20%.

He adds that the introduction of NextGen technology should also help the airport improve its on-time performance record.

Always looking to make improvements clearly goes with the job, and nobody knows this better than Martin, who appears to remain as enthusiastic about the challenges ahead as the day he started 18 years ago.

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