Airlines and civil aviation minister headed for face-off over recently introduced congestion surcharge of Rs 150 per passenger.
Carriers prepare to drive a hard bargain using congestion charge.
BANGALORE: Airlines and civil aviation minister Praful Patel are headed for a face-off over the recently introduced congestion surcharge of Rs 150 per passenger.
If industry insiders are to be believed, airlines, which are in no mood to relent to Patel’s request to rollback the levy, may use the opportunity to negotiate for a cut in the landing, parking and navigational charges at major airports.
“The industry had known from the very beginning that this charge would not be accepted but mounting losses forced it to take a chance. Now that the minister has opposed it, airlines will bargain for some relief on airport charges before pulling it back,” said an industry source.
The recent formation of Federation of Indian Airlines (FIA), an industry body, it will be easier for the carriers put collective pressure on the minister.
Domestic carriers have justified the surcharge saying that airports snarls have bumped up their costs because of the higher fuel burn.
“For no fault of ours, we are burdened with this additional cost. If the government cannot do anything to mitigate it, it cannot advise to remove the charge either,” said a miffed industry leader.
But not everyone in the industry is sharpening arsenal for the showdown. “It won’t be a bargaining situation,” says SpiceJet Ltd managing director Ajay Singh even as he says the congestion surcharge is a rational levy.
“As of now, we haven’t got any official communication from the ministry to roll it back. Once it comes, we will see,” Singh said.
Along with congestion surcharge, airlines currently also levy a fuel surcharge of Rs 750 per passenger because of the hike in aviation turbine fuel (ATF) prices last year. They have not reduced this charge despite ATF prices easing by around 16% in the last two months.
Quid pro quo
The spat with Praful Patel offers a window of opportunity for the airlines
They are likely to seek a cut in landing, parking and navigational charges at major airports
The recent formation of Federation of Indian Airlines affords carriers a unified front to put pressure on Patel
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