LAX director warns passenger, concession and cargo declines threaten jobs; council approves $31M curbside improvement increase

John Ackerman, executive director of Los Angeles World Airports (LAWA), told a Los Angeles City committee that LAX remains financially solvent but is more exposed than many peers to a weak international recovery, falling passenger traffic and declining concession revenues — trends that threaten jobs and local small businesses. The committee approved a second amendment to contract DA5620 with Hensel Phelps Construction Company for central terminal area (CTA) curbside improvements, increasing contract authority by about $31 million.

Ackerman said LAWA is "very financially strong" but warned that airline and concession partners are suffering and that some vendors have contractual exit options if conditions do not improve. "We are okay, but our partners are hurting," Ackerman said. He highlighted multiple performance indicators: LAX is down in passenger rankings (having fallen off the top 10 busiest airports list), the airport is "one of the worst recovered airports in the country post pandemic," and LAWA's first-quarter cargo volumes were down year-over-year. He also reported concession revenue declines — Terminal 1 concession revenues down nearly 30% and duty-free revenues down about 20% versus 2019 — and said some rental car operators saw drops exceeding 25% compared with 2024.

Why it matters: LAWA is a major regional economic engine. Ackerman said LAX supports more than a half-million jobs and contributes tens of billions of dollars annually to the regional economy; disruptions in airline service and concessions ripple through local businesses and workers. He urged the council to pursue regulatory and process reforms to speed hiring, procurement and capital projects ahead of major events such as the 2026 World Cup and the 2028 Olympics.

Contract action: the committee considered Board of Airport Commissioners Resolution No. 28110 and approved the second amendment to contract DA5620 with Hensel Phelps for the CTA curbside improvement program. Mike Christensen (identified in the hearing as the airport CDO) described the work as roadway and pavement improvements, new sidewalks and crosswalks, upgraded lighting and facade work on parking structures and other elements of the arrivals and departures curbsides. Chair Park moved to approve item 5; the roll call recorded Park "yes," McCosker "yes," Rodriguez absent, and the item was approved (2 ayes).

Ackerman and council members discussed workforce and process issues. Ackerman said LAWA is more than 20% below pre-pandemic staffing levels and that city personnel and procurement systems slow hiring and project delivery. He told the committee LAWA has new contracting vehicles (multiple-award task order contracts) and recently completed large capital-market transactions, but warned that longer-term recovery depends on faster approvals and reduced regulatory burdens: "We cannot have it take 10 years to go from the idea of building something to building something," he said.

Council members pressed for specific reforms and a short timeline for LAWA proposals. Ackerman said the airport will deliver a set of proposed reforms in the coming weeks and that some longer structural reforms (such as charter changes) may take longer but should be pursued in parallel. The CTA curbside contract amendment was approved in the same meeting; the item included a categorical CEQA exemption reference for specified class exemptions per the Los Angeles City CEQA guidelines.

The committee continued item 4 to a future meeting, and no further council actions were taken for the verbal LAX quarterly update (item 3) beyond discussion and the informal commitments to bring forward reform proposals.