AAPA: Reduce rents and charges on airlines

  • Business
  • Thursday, 17 Apr 2003

AIRPORT and air traffic management services can and must reduce their charges, rents and other burden which they impose on the airlines, regardless of market fluctuations, the Association of Asia Pacific Airlines (AAPA) said. 

AAPA director-general Richard Stirland, who made the call, said as the spread of Severe Acute Respiratory Syndrome (SARS) had a devastating effect on the bottom lines of airlines in the region, other components of the air transport industry should share the financial consequences of the epidemic. 

“It is not just desirable but vital to the survival of the existing transport industry that these entities share the financial consequences of SARS,'' he said in a statement. 

Stirland said airlines were only one element in the infrastructure established to provide global air transportation; others being airports and service providers, including for example air traffic control, security, immigration, customs and quarantine authorities. 

Other components, he said, were both government-operated and monopoly providers of services.  

“Governments should look again at state provision of war risk insurance and security charges for both passengers and cargo being paid out of general taxation, rather than by imposition on the airlines,'' he said. 

This was particularly urgent in view of the fact that US carriers were already receiving government assistance in the areas of insurance and security costs, he added. 

Stirland said other suppliers should be willing to take a realistic look at prices and payment terms in the light of the catastrophic situation; this includes everyone from aircraft manufacturers to fuel companies and ramp handling agencies. 

He stressed that the airline industry in Asia had for many years been at the heart of the Asian economic miracle. 

The industry's distress must be recognised, its crushing burden shared by those who benefited in the past from its prosperity, he said. The dramatic fall in demand for air travel as a result of the spread of SARS across the region has had a devastating effect on Asia-Pacific airlines. 

Stirland said besides reducing frequencies and cutting cost, airlines are looking at other ways to reduce their exposure to the financial consequences of SARS. 

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