As carriers ground flights, airports look to cut costs

Mumbai: Several airports in India are innovating on ways to cut costs to ride out the economic slowdown.
The Cochin International Airport Ltd (Cial), the first private firm to have built an airport in India, for instance, is tying up with a Kerala-based Ayurveda firm to grow medicinal plants instead of grass at its new international airport in Kochi. It spends Rs2.5 crore a year just to trim grass on about 100 acres.
"This is purely a cost-cutting measure,” A.C.K. Nair, airport director, Cial, said on Tuesday. “In this proposed deal, Cial will not only save the cost of cutting grass, but also will earn a royalty of up to 10% on the turnover by medicinal plants sale.”
“Blessed with rains, Cial’s land is fertile and it is difficult to get such vast land for medicinal plant cultivation, which is critical for ayurvedic treatment,” Nair said on the sidelines of an aviation conference organized by media business firm Terrappin Holdings.
Cial also saved money on re-carpeting its runways by completing the task in six months, with minimum disruptions to aircraft movement.
Till these airlines start flying at full strength again, the airports are finding ways, both obvious and innovative, to keep their bills low.
“When the visibility is clear, and if it is above 3,000m, we switch off the lights on the runway,” said P.S. Nair, former chief executive of the GMR Group-promoted Rajiv Gandhi International Airport in Hyderabad and current chief executive of Delhi’s Indira Gandhi International Airport. “We could save around Rs48 lakh a year by switching off the lights of the runway (in Hyderabad). We have introduced this system partially in the Delhi airport as well.”
The Hyderabad airport saved Rs22 crore in fiscal 2009 through such measures and by renegotiating service contracts. It also engaged the National Productivity Council, a state-run body that provides training and consultancy in improving productivity, he said.
The Siemens AG-led consortium that built and runs the Bengaluru International Airport is headed in that direction. “We have halved our capital expenditure plans to Rs35 crore from Rs70 crore for this financial year with the downturn in passenger traffic,” said Marcel Hungerbuehler, chief executive of Bangalore International Airport Ltd. The airport in Bangalore has also resorted to simpler measures, such as using large windows to save on electricity bills.
A senior executive at Mumbai International Airport Pvt. Ltd, a GVK group-controlled firm that runs the Chhatrapati Shivaji International Airport in the financial capital, said the airport is looking at substantial savings from big measures, including outsourcing of maintenance and service contracts. But small savings still matter.
02/07/09 P.R. Sanjai/Livemint

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Categories: Airports Jul 2009