ACI World Calls for ‘Economic Equilibrium of Airports’

Airports Council International (ACI) World is calling on regulators to restore the economic equilibrium of airports through financial compensation or through future airport charges for the benefit of the traveling public.

More specifically, ACI is urging governments to acknowledge the changed risk profile of airports due to the pandemic and to provide regulatory support to restore economic equilibrium for unrecovered costs.

The association representing world airports is stressing that airport charges have not adjusted to actual market and demand conditions.

“It is vital that international and national regulators support the economic sustainability of airports as crucial players in the health of the entire aviation ecosystem,” said ACI World Director General Luis Felipe de Oliveira.

ACI World Director General Luis Felipe de Oliveira. Photo source: ACI World.

“Restoring the economic equilibrium of airports through financial compensation or through future airport charges is necessary for investing in the infrastructure needed to accommodate the growth of air travel and meet decarbonization targets,” he said.

According to ACI, the Covid pandemic led to a 61 percent global decline in airport passenger traffic in 2020 compared to 2019, dropping from 9.2 billion passengers in 2019 to 3.6 billion passengers in 2020.

The impact on revenues in the years following has resulted in capital expenditure reductions, says ACI, adding that in some cases where government financial support or other relief measures were insufficient, airports also had to re-finance their operations.

Airports, de Oliviera notes, face high fixed costs irrespective of economic conditions and do not have the same level of flexibility in managing capacity.

“Under a regulated regime of airport charges that do not adjust to actual market and demand conditions, there should be full awareness of the fact that the regulated formula that protects airlines in good times also requires protecting airports in bad times,” he said.

The association cites InterVISTAS research according to which there is a need for a shift towards light-handed airport charging models. The data shows that the direct cost of airport charges -levied on both passengers and airlines- to consumers is small in terms of the final ticket price, including airline ancillary charges.

ACI World is calling for a new approach to economic oversight to ensure better use of airport capacity through flexible pricing, the fostering of infrastructure development for connectivity, achieving decarbonization targets, maximizing socio-economic benefits, and providing charges incentives to address issues of congestion, noise, and climate change impacts.

“All such advantages encourage the growth of a sustainable aviation ecosystem for the benefit of travelers and communities in all regions,” said ACI.