Airfare pressure: Watchdog to consider rise in air traffic control fees
Airlines flying in Australia may soon pay more for air traffic control services, which could result in a rise to already inflated airfares. Airservices Australia – the government-owned body that oversees air navigation in Australia – has proposed to the competition watchdog to increase its fees for the first time since 2015. The Australian Competition and Consumer Commission [ACCC] will seek industry consultation until January 19 before making a determination. If the suggested price increase is implemented, international and domestic airlines will pay an average of 19% more for navigation and aviation firefighting services across four rises between mid-2024 and 2026. Airservices has not increased fees since a 0.4% rise in 2015. It dropped its fees by 2% in 2019 after a restructure to “rebalance revenue growth driven by international airline operations over 2018”, a spokesperson said. “Airservices is seeking to increase prices to rebalance charges to changes in demand and enable us to continue to fund frontline service delivery and invest in key programs to support the industry’s ongoing recovery and future growth,” a spokesperson said. The fee increase is not good news for travellers expecting cheaper airfares or airlines juggling already inflated fuel bills due to the wars in Ukraine and Gaza. Qantas Airways and Virgin Australia have recently moved to partially offset sustained rises to their fuel bills through ticket prices, with Qantas revealing its fuel bill has increased by more than 30% since May. Under the current model, airlines flying a Boeing 737-800 with 174 seats from Melbourne to Brisbane incur a per passenger cost of about $13 for Airservices Australia’s services. Under the first proposed price change, the per passenger cost would increase to about $14 in April 2024. Airlines currently pay Airservices about $35 a passenger to fly an Airbus A380 with 853 seats from Singapore to Sydney. Under the first proposed rise, this would increase to about $37 in April.<br/>
https://portal.staralliance.com/cms/news/hot-topics/2023-12-01/general/airfare-pressure-watchdog-to-consider-rise-in-air-traffic-control-fees
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Airfare pressure: Watchdog to consider rise in air traffic control fees
Airlines flying in Australia may soon pay more for air traffic control services, which could result in a rise to already inflated airfares. Airservices Australia – the government-owned body that oversees air navigation in Australia – has proposed to the competition watchdog to increase its fees for the first time since 2015. The Australian Competition and Consumer Commission [ACCC] will seek industry consultation until January 19 before making a determination. If the suggested price increase is implemented, international and domestic airlines will pay an average of 19% more for navigation and aviation firefighting services across four rises between mid-2024 and 2026. Airservices has not increased fees since a 0.4% rise in 2015. It dropped its fees by 2% in 2019 after a restructure to “rebalance revenue growth driven by international airline operations over 2018”, a spokesperson said. “Airservices is seeking to increase prices to rebalance charges to changes in demand and enable us to continue to fund frontline service delivery and invest in key programs to support the industry’s ongoing recovery and future growth,” a spokesperson said. The fee increase is not good news for travellers expecting cheaper airfares or airlines juggling already inflated fuel bills due to the wars in Ukraine and Gaza. Qantas Airways and Virgin Australia have recently moved to partially offset sustained rises to their fuel bills through ticket prices, with Qantas revealing its fuel bill has increased by more than 30% since May. Under the current model, airlines flying a Boeing 737-800 with 174 seats from Melbourne to Brisbane incur a per passenger cost of about $13 for Airservices Australia’s services. Under the first proposed price change, the per passenger cost would increase to about $14 in April 2024. Airlines currently pay Airservices about $35 a passenger to fly an Airbus A380 with 853 seats from Singapore to Sydney. Under the first proposed rise, this would increase to about $37 in April.<br/>
