At airports?
Yes, these are charges made to airlines by airports for using their runways.
While they are paid by airlines, they result in higher fares so should be viewed as a direct charge on consumers.
Rising costs: Head of AIG Willie Walsh warned passenger fares would be pushed higher
Who sets it?
The Civil Aviation Authority yesterday announced it had capped the rate for airports for five years from 2014.
More... Air passengers face paying higher fares despite airport landing fee price caps, warns boss of BA parent Willie Walsh Taken for a ride: How the hidden price of a taxi from the airport could add £400 to the cost of your holiday 30 SECOND GUIDE: DEMISINGThe exact figure differs from airport to airport, with Heathrow’s rates capped 1.3 per cent below inflation, measured by the retail prices index, and Gatwick’s rates 1 per cent above RPI.
It said this would protect consumers from rising rates.
Will it?
Airline bosses don’t think so. Willie Walsh, head of British Airways’ parent IAG, warned the move would push passenger fares higher.
He said an ‘over-priced, over-rewarded and inefficient’ Heathrow Airport had already benefited from a decade of ‘inflation-busting’ hikes which had already seen landing fees triple.
So who is right?
The Board of Airline Representatives in the UK, which represents 80 airlines, said the price-caps were ‘a step in the right direction’ but did not go far enough.
Virgin and BA argue any rise in rates will add to recent hikes and push ticket prices up again.
Because airlines’ margins are already razor-thin, the companies do not have the capacity to absorb increasing rates.