NEW DELHI: The financial turbulence that airlines are experiencing these days due to soaring fuel cost, is pushing airport developers to think on lines of building low cost airports. GMR Group is looking at this model, where efficient greenfield airports could be built in smaller cities for anywhere between one-fifth to half the cost of the Rs 2,500-crore airport it has built in Hyderabad. Such airports would mean lower charges for airlines, helping their survival and also no extra charges for passengers that would help reverse the trend of lower demand. Cities that already have an operational runway could get a new low-cost terminal for as low as Rs 150 crore, said a senior GMR official. This thinking comes shortly after airlines are bleeding heavily due to high global oil prices and delayed payments to airports by them have become common. Recovering costs of fancy airports through levy of user development fee (UDF) has also become a touchy issue in these times of high surcharges and taxes. "We are looking at developing very efficient basic airports with quality of service is of highest standards. These airports would not have too many fancy things, like perhaps one aerobridge for each million passenger traffic annually," said the official. While the blueprint is being finalised, the group estimates that in a city like Pune a low-cost airport could be built for Rs 1,000 crore, while cities of size of Coimbatore, Amritsar or Udaipur could get an airport for half this cost. The GMR group said it would be adding a low-cost terminal at its Hyderabad airport once annual traffic reaches the 12-million mark by 2011-12. Delhi, where the same group is modernising the IGI Airport, is also likely to get a low-cost terminal. Interestingly, the demand for low-cost terminals was raised some months back first by the pioneer of low-cost travel in India, Air Deccan founder Captain G R Gopinath. He had even formed a consortia with some leading industry players but the idea did not click then. But the record spurt in crude prices that has crippled the airlines financially, has now given a fresh impetus to the idea. "Fancy airports can either be built with government support or levying very high charges on airlines and UDF on passengers. In the current scenario, this is increasingly becoming a difficult option for cities where traffic is going to be less than 10 to 20 million. So low cost but ultra efficient airports are the need of the day," said an airline official. Creation of low-cost airports with economical charges has been a major demand of Indian LCCs as they offer relatively cheaper tickets while paying the same amount as airport charge as full service carriers.
Jun 23, 2008
Developers plan Low Cost Airports
NEW DELHI: The financial turbulence that airlines are experiencing these days due to soaring fuel cost, is pushing airport developers to think on lines of building low cost airports. GMR Group is looking at this model, where efficient greenfield airports could be built in smaller cities for anywhere between one-fifth to half the cost of the Rs 2,500-crore airport it has built in Hyderabad. Such airports would mean lower charges for airlines, helping their survival and also no extra charges for passengers that would help reverse the trend of lower demand. Cities that already have an operational runway could get a new low-cost terminal for as low as Rs 150 crore, said a senior GMR official. This thinking comes shortly after airlines are bleeding heavily due to high global oil prices and delayed payments to airports by them have become common. Recovering costs of fancy airports through levy of user development fee (UDF) has also become a touchy issue in these times of high surcharges and taxes. "We are looking at developing very efficient basic airports with quality of service is of highest standards. These airports would not have too many fancy things, like perhaps one aerobridge for each million passenger traffic annually," said the official. While the blueprint is being finalised, the group estimates that in a city like Pune a low-cost airport could be built for Rs 1,000 crore, while cities of size of Coimbatore, Amritsar or Udaipur could get an airport for half this cost. The GMR group said it would be adding a low-cost terminal at its Hyderabad airport once annual traffic reaches the 12-million mark by 2011-12. Delhi, where the same group is modernising the IGI Airport, is also likely to get a low-cost terminal. Interestingly, the demand for low-cost terminals was raised some months back first by the pioneer of low-cost travel in India, Air Deccan founder Captain G R Gopinath. He had even formed a consortia with some leading industry players but the idea did not click then. But the record spurt in crude prices that has crippled the airlines financially, has now given a fresh impetus to the idea. "Fancy airports can either be built with government support or levying very high charges on airlines and UDF on passengers. In the current scenario, this is increasingly becoming a difficult option for cities where traffic is going to be less than 10 to 20 million. So low cost but ultra efficient airports are the need of the day," said an airline official. Creation of low-cost airports with economical charges has been a major demand of Indian LCCs as they offer relatively cheaper tickets while paying the same amount as airport charge as full service carriers.
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