Business · Companies · 8 hrs ago

GMR proposes higher, distance-based fees at Bhogapuram airport

GMR proposes higher, distance-based fees at Bhogapuram airport

GMR has proposed higher passenger fees at the new Bhogapuram airport in Andhra Pradesh, with charges varying by domestic journey length.

The plan sets different fees for trips up to or over 1,000 km and would raise some charges to more than double their first-year levels by FY31.

Airport fees, known as user development fees, are added to ticket prices and collected by airlines for airport operators.

GMR says the increases would help recover investment and financing costs, while experts warn they could make flying less affordable and reduce demand.

IndiGo has objected to the distance-based fees, saying higher airport charges could discourage travel in India’s price-sensitive market.

AERA must decide whether to approve the proposal; it regulates charges at major airports, and an interim order set flat fees at Bhogapuram.

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What people are saying

G.S. Bawasecretary general of the Air Travellers Association
Passengers are already burdened by high airfares. Such proposals make flying less attractive. If allowed, private airports will soon start determining UDF based on body weight.
via Mint
IndiGoairline
We would request AERA not to consider the airport operator's proposal to have different UDF rates based on distance.
via Mint
Willie WalshIndiGo chief executive
Airport charges are too high and so this market would do much better if we had lower taxes.
via Mint
effective monopolies
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