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Landing charges to increase in peak hours |
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Air tickets during peak hours are likely to increase as the government plans to introduce differential tariffs for peak and non-peak hours. Airlines may have to pay double charges for flying during peak hours (between 7 to 10 am and 6 to 10 pm) while the non-peak hour tariffs between midnight and 5 am may be halved. While the move would raise the cost for airline companies, congestion may reduce leading to lesser flight delays.
The air fares for peak-hour flights may go up by 10 to 15% from the end of March. For instance, the early morning Mumbai-Delhi ticket will cost an additional Rs 600 to Rs 1,800. Consequently, there would be a drop in airport charges for flights operating during non-peak hours at these airports. The low-cost airlines are expected to bite the bait first. The airport charges are being hiked with a view to decongesting airports. Pointing out that differential airport charges exist in the US and Europe, airline sources said a similar system was overdue in India. According to a top civil aviation ministry official, landing charges, parking charges and route navigation charges levied on commercial airlines would be doubled during peak hours at airports from March 25 onwards. Civil Aviation Secretary Ashok Chawla "We are working on a clear system of incentives or disincentives for airlines operating services during three peak hours in the morning and four in the evening," civil aviation secretary Ashok Chawla was quoted in a leading business daily. The airports on which these charges would be effective are Delhi, Mumbai and Bangalore. Mr Chawla, who took over a month ago, indicated that airport and navigation charges could be doubled during peak hours and halved between midnight and 0500 hours. Landing fees are currently charged according to the weight of the aircraft. At present, the Directorate General of Civil Aviation charges Rs12,000 to Rs14,000 per flight for landing and Rs4,500 to Rs5,000 per flight for navigation at all airports. The landing charges for peak hours are now expected to shoot up to Rs24,000 to Rs28,000 while the navigation cost may rise to Rs9,000 to Rs10,000. Airlines are, however, charged additional fees if they fail to take off within two hours of landing. Chawla said the exact charges had not been decided upon but would be in place before the summer schedule for the industry begins in the last week of March. Congestion charge may be replaced by peak hour charge Most private carriers have already imposed Rs. 150 as a congestion surcharge on their tickets, but state-owned Indian has not done so. Congestion surcharge was introduced to partially offset increasing costs due to aircraft burning fuel while holding for landing or take-off. The surcharge does not have anything to do with airport charges, airline sources said. The burden on airlines due to the increase in airport and navigation charges could in turn be passed on to consumers travelling during peak hours. For the flier, the move means higher fares for peak-hour tickets. Landing and navigation costs constitute 6 to 10 per cent of the fare. He, however, said the hike in charges would 'essentially be a short-term solution'. "In the long-term, we have to provide more facilities like additional runways and rapid-exit taxiways to overcome congestion. This should be in place by June 2008," he added. He said the three airports were handling between 15% to 20% of excess traffic during peak hours compared to their capacities. Private airlines’ views Domestic carriers said they would pass the price hike on to consumers. The move will hit low-cost carriers the hardest since the hike will impact their fares the most. “If we do fly during peak hours, the additional cost will of course go to the passenger. All airlines will take up the issue with the ministry,” SpiceJet chairman Siddhanta Sharma said. “It’s something all budget carriers have been asking for. There should be differential tariffs. Most of our flights are during non-peak hours,” said Ajay Singh, director, SpiceJet. Singh added navigation and landing charges accounted for 4-5 per cent of the total cost. “So if these rates go down by half, we won’t save more than Rs 50 on a Rs 2,500 ticket,” he added. Calling the new charges unfortunate, Air Deccan COO Warrick Brady added, “We already have enough cost today. Additional costs will have to pass on to the customers.” Sources close to Kingfisher Airlines said there would be no option but to increase fares if differential pricing comes into effect.
Meanwhile, decks are cleared for the long-awaited modernization of the Chennai airport with a way found out of the land acquisition problem. Chawla said the issue would be sorted out in about two months. The modernization of Chennai airport — like in Delhi and Mumbai — will be in the Public-Private-Partnership format with 51% Indian equity. The plan for Chennai had run into rough weather with widespread protests over land acquisition in the area around the airport. Some 5000 homes and 50,000 people living behind the existing Chennai airport would have to be rehabilitated for the modernisation plan. The Ministry has finally found the way out, with alternative land identified. The ministry, though, has to be more cautious as far as the Kolkata is concerned with the Left parties hardly in a mood to allow the Delhi-Mumbai airport modernisation model to be replicated here. The ministry, therefore, plans to route the plans for Kolkata airport through the Airport Authority of India. On the budget proposal to levy three per cent customs duty on imported aircraft, the Civil Aviation Secretary said besides Customs duty, another 16% is levied as countervailing duty, three per cent as education cess and another three per cent as special duty. “We would propose to the Finance Ministry that the 16 per cent countervailing duty be removed on aircraft not produced domestically,” Chawla said.
Asked about the 'grandfather rights' of the airlines to operate in peak hours, the secretary agreed these airlines had a right "but the charges can always be calibrated". Grandfather rights are those under which airlines operating on peak-hour slots for several years can claim their right on them. Mr Chawla also said there would be no difference in the charges for low-cost carriers and full-frill ones during peak hours; though these would vary for different types of aircraft they operate during this period to these airports. Contact Us
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