Mumbai International Airport Limited's proposal seeking 660% hike in aeronautical tariff will adversely impact passenger demand, according to aviation industry experts.
Any hike in tariff has to be approved by Airport Economic Regulatory Authority which is now examining MIAL's proposal. In April AERA has approved a 345% hike in tariff for Delhi airport comprising of landing and parking charges and user development fee.
Airlines have bitterly opposed the increase at Delhi since its impacts their operating costs. "The increase in airport charges do not commensurate with yield and revenue we generate from Delhi. We are unable to raise fares because of competition and if India wants to encourage more airlines to fly it should keep the charges reasonable,'' said a India head of foreign airline.
"In the past three months we have seen passenger demand drop with rise in fares. If Mumbai airport hikes its tariff it will have a significant impact on demand. Passenger demand could fall. A staggered increase in tariff would be more suited than one time 660% hike as sought by Mumbai airport,'' said Sharat Dhall, president-online of travel portal Yatra.com.
24/09/12 Aneesh Phadnis & Sanjay Jog/Business Standard
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Any hike in tariff has to be approved by Airport Economic Regulatory Authority which is now examining MIAL's proposal. In April AERA has approved a 345% hike in tariff for Delhi airport comprising of landing and parking charges and user development fee.
Airlines have bitterly opposed the increase at Delhi since its impacts their operating costs. "The increase in airport charges do not commensurate with yield and revenue we generate from Delhi. We are unable to raise fares because of competition and if India wants to encourage more airlines to fly it should keep the charges reasonable,'' said a India head of foreign airline.
"In the past three months we have seen passenger demand drop with rise in fares. If Mumbai airport hikes its tariff it will have a significant impact on demand. Passenger demand could fall. A staggered increase in tariff would be more suited than one time 660% hike as sought by Mumbai airport,'' said Sharat Dhall, president-online of travel portal Yatra.com.
24/09/12 Aneesh Phadnis & Sanjay Jog/Business Standard
