EU plans Air-Traffic fee changes that may hit budget carriers

Tourism

European Union countries will align rules for imposing air-traffic control fees next month, a step that may increase costs for no-frills airlines such as Ryanair Holdings Plc and EasyJet Plc.

The new system to take effect on January 1 requires the fees for guiding takeoffs and landings to make up a bigger share of total air-traffic charges, which also include en-route payments. The adjustment threatens to hit airlines that take off and land more often.

„The scheme may lead to a limited increase of costs for airline companies mostly relying on short-haul routes,” the European Commission, the 25-nation EU's executive arm, said in a statement yesterdayin Brussels. The commission projects a cost rise of about 2% for short-haul routes. The EU wants airlines to pay the full cost of air-traffic control around airport terminals so that carriers flying over avoid financing a service they don't use and can benefit from a reduction in en-route charges.

Airlines pay €7 billion ($9 billion) a year to be guided through the European skies. On a per-flight basis, that's twice the US rate. The new fee system is part of EU efforts to reduce airspace fragmentation by creating a „single European sky.” The single-sky initiative's central aim is to cut costs for airlines by allowing them to fly more direct routes through military airspace and by reducing the number of civilian control centers. (Bloomberg)

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