IATA Blasts AoT's Fee Hikes at Meeting

Jun. 12--VANCOUVER -- Bangkok's Suvarnabhumi Airport is profiting at the expense of airlines by abusing its monopoly status by imposing excessive landing and parking charges, the International Air Transport Association (IATA) claims.

The 650 delegates at IATA's 63rd annual general meeting, held last week in Vancouver, were told that Airports of Thailand Plc (AoT), along with airport operators in London and Paris, had added US$1.4 billion to carriers' bills last year.

The 260-member trade group categorised the trio as the top three raisers of airport costs, with the breakdowns of $499 million in incremental costs for Bangkok, $634 million for Paris and $188 million for London.

The meeting has also heard that the airport operators in Auckland, Sydney, Hong Kong, Seoul and Johannesburg have reaped profit margins of more than 40 percent, while airlines have seen their cost savings -- $1.9 billion last year -- diminished by the increased airport costs.

"This is outrageous and I will continue to embarrass them with facts and figures," said IATA director-general and CEO Giovanni Bisignani.

Last year, airports around the world added $1.97 billion to airlines' bills.

"Look at the financial results of airports. Clearly, it's a dream world for them but a nightmare for airlines that pay the bills," the IATA chief told airline executives from around the world.

He said numerous airports still operated as "happy monopolies".

While commercial discipline is the regulator for airlines, Mr Bisignani described airport regulators as "phantoms" as they don't control airport charges.

While welcoming the European Commission's plan to introduce a directive on airport pricing in Europe as a progress, the IATA chief said: "We do not need any more phantom regulators. We need a directive with real teeth".

However, the world's airlines had managed to achieve $863 million last year in savings from IATA's move to convince airports to reduce charges last year.

At the same time, IATA members also received $640 million in savings from air-navigation service providers.

But Mr Bisignani said there was still "a long way to go" for IATA to secure cost savings from airport operators and navigation service providers.

For two years, the Geneva-based organisation has battled in vain with AoT to prevent the "unjustified" 15 percent rise in landing and parking charges, which took effect in April this year.

Thailand's Transport Ministry and AoT have turned a deaf ear to IATA's repeated calls by arguing that despite the increase, the landing and parking fees at the Thai airport were still lower than at other leading airports in Asia, some temporary promotional campaigns aside.

IATA officials said the fee hike was not justifiable, as it did not give due consideration to the value offered to carriers in light of the fact that all the flaws, which had created a bad name for the Suvarnabhumi, had largely not been fixed.

In December 2005, Robert Milton, who served as IATA's chairman until mid-2006, called for members to stop flying to particularly egregious airport offenders.

However, the call by Mr Milton, who is also chairman and CEO of ACE Aviation Holdings, Air Canada's parent firm, did not translate into action.

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