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5 May, 2008 05:40

Airport tariffs take off

Russia's Federal Tariff Service has redefined the way airlines will be charged for using the country's airports. This comes in the wake of rapidly growing fuel prices, which have risen by 20% since the beginning of the year.

Russia’s Federal Tariff Service has announced its first substantial increase in airport fees since 2005.

The new tariff model for take-off and landings, air safety, use of terminals and general passenger services has gone up by a third on average.

The cost per passenger for using an air terminal in Moscow for an international flight is now $US 8.53 for a foreign carrier and $US 2.94 for a Russian one.

All rates will now be set in rubles as opposed to the U.S. dollars, as collecting fees in the falling US dollar leads to a loss in profits.

Analysts consider foreign carriers will suffer from the increases in the air tariffs the most.

“Tariffs for foreign air companies, including airport fees, are three times higher than for domestic carriers. This accounts for 18 to 25 per cent of a company's expenditure pattern,” said Mikhail Saino from the Broker Credit Service.

The increase in tariffs is, of course, passed on to the passenger and is included in the final ticket price.
 “Basically if there is a change in the passenger service charge from the airport authority's side, of course we have to reflect this, but this is definitely not an initiative of the airline,” said Jan Toth of Czech Airlines.

Moscow’s airports are learning how to maximise profit and infrastructure development, introducing new terminals, retail outlets and security procedures in recent years.

It has been estimated Moscow airports get approximately half their profit yield from tariffs.

The new tariff system, which is implemented by the federal government, will enable airports to come closer to the fees charged by other European countries. The changes will hopefully provide passengers with better service.