Airfare hike not tied to increased airport charges; ACI

19 Sep 2024 CW Team

The Airports Council International (ACI) stated that rising airfares are not linked to increased airport charges. Airport charges are crucial for infrastructure development within the commercial aviation ecosystem, but they remain a minimal part of the overall airfare. Stefano Baronci, Director General of ACI Asia Pacific & Middle East, emphasized that airports are infrastructure-intensive businesses, with costs dominated by maintaining essential infrastructure such as runways, taxiways, aprons, and terminal buildings. He noted that neglecting the capital expenditure needed to support future growth could lead to serious socio-economic consequences.

ACI, which includes 133 airport operators managing 624 airports across 47 countries—including India and the Airports Authority of India (AAI)—responded to concerns raised by the International Air Transportation Association (IATA) over increasing airport charges. IATA recently cautioned countries, including India, to be mindful of rising charges. Despite significant investments in India's airport infrastructure, IATA's Director General, Willie Walsh, expressed worries about the rising costs, as tariffs for major airports are regulated by the Airports Economic Regulatory Authority (AERA) and have recently increased at some airports.

However, Baronci argued that the impact of airport charges on consumers is negligible, comprising only about 5.1% of the base airfare and ancillary fees. ACI projects that air traffic in the Asia-Pacific region will surge to 8 billion by 2042, up from 3 billion currently. India, one of the world's fastest-growing aviation markets with 157 operational airports, is anticipated to be the second fastest-growing market in the region.

(ET)

Infrastructure Urban

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