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Suvarnabhumi Airport : Flight Status

Tuesday, August 7, 2007

Airlines slam AoT for excessive fees

Low landing fees but costly hidden charges


The dispute between airlines and the Thai airport monopoly over airport users' fees has resurfaced as both sides remain steadfast in their arguments over rates.


The Board of Airlines' Representatives in Thailand (BAR), an industry group representing 64 international carriers, revived the debate last month when it alleged that the high charges at Suvarnabhumi Airport undermined Bangkok's bid to become Southeast Asia's aviation hub.


Suvarnabhumi Airport general manager Serirat Prasutanond insisted this week that its landing and parking fees were either below or close to those of other regional airports.


Airports of Thailand Plc (AoT) raised the landing and parking charges by 15% in April, much to the dismay of airlines.


Mr Serirat said in an interview that the parking and landing fee for a Boeing 747-400 at Suvarnabhumi was US$1,892 based on an exchange rate of 34 baht to the dollar, compared with $3,012 at Hong Kong International Airport (HKIA) and $2,351 at Singapore Changi Airport.


He conceded that Suvarnabhumi's landing and parking fees were still higher than those at Kuala Lumpur International Airport (KLIA), while acknowledging that there were charges imposed on airlines that were beyond AoT's control. ''Excluding Japan, we ranked third, after Singapore and Hong Kong,'' he said.


But the BAR and the International Air Transport Association (IATA) have disputed his claims, pointing to other fees imposed at Suvarnabhumi.


Airlines looked at their total turnaround costs at an airport, said Albert Tjoeng, IATA spokesman for Asia Pacific, explained.


''That's because in addition to landing and parking fees, a turnaround flight also has to pay other charges, such as the aerobridge charge, air-conditioning charges, concession fees, etc,'' he said.


''It is more meaningful to compare Bangkok with Kuala Lumpur and Singapore as these three airports compete for similar traffic, and have similar unit costs. The turnaround cost at Bangkok is the most expensive among the three airports for various aircraft types,'' Mr Tjoeng said, citing IATA figures (see table).


BAR president Brian Sinclair-Thompson also maintains that the Suvarnabhumi charges are uncompetitive, which has deterred airlines from adding flights, and in some cases caused them to divert to other airports.


Chotisak Asapaviriya, the former head of AoT, answered critics at IATA in August last year by saying that airlines unhappy with Suvarnabhumi could choose not to use the facilities.


The Thai government's inconsistent airport policy and uncertainty over future airport expansion has also caused Bangkok to lose out to neighbouring countries including China, India and Vietnam, added Mr Sinclair-Thompson, who also serves as general manger for Southeast Asia for Swissair.


Mr Serirat, however, questioned why airlines were complaining when landing and parking constituted only 3-4% of the total airline trip cost.


He said AoT was constantly monitoring rival airports' fees to ensure Bangkok remains competitive.


He argued that AoT needed to generate revenue to cover expenses and investments for the 125-billion-baht airport's construction.


IATA's Mr Tjoeng countered that airlines were paying for AoT's mistakes.


''AoT needs to ensure that its own expenses and investments are cost-efficient. Productivity improvements, lack of wasteful investment, optimal procurement policies are all important to keep costs to a minimum,'' he said.


''Airlines should not be burdened with additional costs due to poor planning, compensation issues, repair costs arising from defects at the airport, duplicated services as a result of operating two airports, and the other mistakes of AoT,'' he said. ''Charges need to be cost-based, and transparent,'' he said.

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