Facts & Figures

Fact Sheet: Infrastructure

  • Around 11% of the cost of air transport comes from infrastructure charges.
    • In 2007, airlines and their customers paid at least $54.2 billion in these charges (1)
    • In comparison, airline revenues (a proxy for the cost of air transport) totaled $508 billion (2) 
  • IATA campaigns with infrastructure providers (airports, air navigation service providers, and fuel suppliers) as well as regulators and governments to deliver cost savings and efficiency improvements. Our activities include direct consultation, negotiation and lobbying activities.
  • In all its work, IATA emphasizes the key principles of infrastructure charges:
    • Transparency
    • Cost-relatedness of charges
    • Consultation with airlines
    • Equitable charges structure
    • Single till
    • Productivity improvements

Our Approach and Strategy in 2009

  • During the crisis of 2009 our key messages were:
    • Charges must not increase in 2009: providers should offer reductions or freezes for short term relief
    • To help achieve this, providers should delay non-essential investments and costs
    • They should resolve cost under-recoveries without increasing charges
    • Governments should reduce their own cost burdens on providers such as the need for full cost recovery, cost of capital requirements, MET costs, etc

IATA Infrastructure Cost Savings

  • In 2009, IATA generated total savings of $4.3 billion in charges, fuel and taxation, of which $3.1 billion were real cost reductions. These savings were mitigated by $2.9 billion in increases.

Cost Campaign Impacts 2009

 

  • A number of providers responded favorably to the crisis last year and to IATA’s campaigns for cost savings, adopting a collaborative attitude towards the airline industry.
    • Airport: Civil Aviation Authority of Singapore (CAAS) reduced landing charges by 25%
    • ATC: The Mexican provider SENEAM announced a 50% reduction in ATC fees for 3 months
    • Fuel: The Peruvian government exempted jet fuel from a selective tax
    • Tax: The Dutch government cancelled the Dutch Air Passenger Duty
  • Yet, not all providers reacted positively to the industry’s situation, announcing increases for 2009 that will have an adverse effect on the industry:
    • BAA and the UK CAA: London Heathrow’s 86% increase
    • Delhi and Mumbai airports: 207% increase
    • ACSA (South Africa): proposing a 133% increase
    • Eurocontrol States: Various increases in 2010 unit rates up to 32%

Our Targets in 2010

 

  • IATA’s 2010 target for savings is US$2 billion, including at least US$0.5 billion in real cost reductions.
  • The results of 2009 will be much tougher to repeat in the coming year. We will have to combat the effect of struggling providers and governments seeking to fill their empty coffers with increased charges and new taxes. Our messages in 2010 are the same as always, emphasizing the need for freezes and reductions in charges. But the solutions will need to be adapted to the post-crisis economic environment. We must now focus on longer-term agreements of 3 to 5 years and on ways to avoid the explosion of under-recoveries from 2009.

(1) $42.0 billion in airport charges (ACI 2007) and $12.2 billion in air navigation services charges ( ICAO 2007)
(2) IATA 2008

 

Updated: February 2010