Chicago Skyway raising tolls a sixth for cars, a third for trucks Jan 1 (ADDITIONS)
By Peter Samuel
Tolls on the Chicago Skyway are rising Jan 1 of the new year, by one sixth for cars and one-third for trucks. The toll for a car will rise from $3.00 to $3.50, or 16.7% regardless of time of day in the new year. Trucks get a discount of about 29% when traveling after 8pm to before 4am. This is $4.80 off for a 5 axle tractor-trailer.
The Skyway is 7.8 miles or 12.6km long, and elevated for its whole length, heads diagonally northwest-southeast across the area south of downtown Chicago making for a short direct route between the central Chicago 'Loop' and the Indiana Toll Road and points east, southeast and northeast.
(see map at bottom)
Car tolls are 45c/mile and 5-axle tractor trailer tolls $2.15/mile 4am to 8pm and $1.54/mile 8pm to 4am.
Present tolls were set Jan 1, 2008. The concession provides for increases to by CPI or $4.00 for cars $3.00/axle in 2013, $4.50 and $3.60 in 2015, $5.00, $4.20 in 2017. From then on the toll caps will be adjusted by CPI alone.
(see tables nearby)
Traffic down, cars 13%, trucks 40%
Traffic on the Skyway has been in decline since 2006, the first full year of the concession.
From average daily traffic of 50.4k in 2006 it declined to 44.7k in 2008, recovered to 47.3k in 2009 but is down again this year - to 42.1k in the first half of the year. The last number is 17% down.
Car traffic is off 13%.
Better paying truck traffic is down more, and more steadily - from a high in 2006 of 5,945/day. Truck numbers were off 29% of the 2006 high to 4,225 in 2009 and off 40% to 3,535k in the first half of this year.
Much of this no doubt is the housing bubble burst and financial crisis and the Great Recession that followed.
Long distance truck traffic is heavily correlated with the economy.
Also, however, improvements to the Borman Expressway, the free road that competes, seem to have eroded the time advantage of the Skyway.
"...strong forecast traffic growth"
Macquarie said in presentations in 2005 when they were half of the $1.83b concession bid that they had "strong forecast traffic growth" for the Skyway, and Cintra's people no doubt expected the same. In place of strong growth, which they envisaged longterm, there has been strong decline - so far.
Their good news is that they have maintained revenues with toll increased and slightly reduced costs. Their cash flow or EBITDA is slightly improved.
Borrowing the overhang, interest costs the burden
Their problem is the two thirds of the upfront cost of the $1.83b concession that they borrowed.
Interest on their borrowings alone is 50% larger than toll revenues at $95m/yr.
Adding in $25m of depreciation and amortization the EBITDA is swamped and the past two years they have run up losses of $67m and $65m. And the loss will probably be larger this year.
Macquarie Atlas Roads analyst package 2010:
The Skyway is operated by Skyway Concession Company which is owned by Spain-based Cintra Concesiones de Infraestructuras de Transporte SA and Australia-based Macquarie Atlas Roads (not Macquarie Infrastructure Group as the Skyway website incorrectly states.)
ADDITIONS 2010-12-07 20:45