Airlines want airport fees cut further

The Taipei Airlines Association (北市航空運輸公會) yesterday released a seven-point petition appealing to the government to bail them out of a financial squeeze caused by the spread of severe acute respiratory syndrome (SARS).

"Not only China-bound flights are negatively impacted, domestic travelers are also shying away from flights," Solo Su (蘇賢榮), the association's secretary general, said yesterday.

The disease has seriously threatened survival of local air carriers, he said.

On behalf of six local airlines, the association urged the government to postpone the monthly collection of charges at domestic airports, including landing fees, maintenance fees, land rental and noise fees, until August.

Chinese-language media reported that the Ministry of Transportation and Communications approved the postponement last night, citing Lee Lung-wen (李龍文), director of the ministry's Department of Navigation and Aviation.

Lee also was quoted as saying that all airlines will enjoy a reduction in landing fees which will range between 15 percent and 50 percent this year.

The association also urged the government to consider cutting the fees at CKS International Airport, which the association said are around 30-percent higher than most airports in Southeast Asia.

"In addition to a reduction in the number of flights, these measures will greatly help to cut costs," Su said.

The association also asked the government to cut the 5 percent value-added tax on air tickets, as well as taxes on jet fuel, and offer low-interest loans for a period of up to two years.

Su said that the association will soon hold detailed discussions with airlines to finalize any changes.

In response to the petition, the Ministry of Transportation and Communications said that more talks need to be conducted before the government can make the adjustments.

But an aviation official who refused to be identified, said that following fallout from the Sept. 11 attacks in the US, the government cut airport charges, including landing fees, by 25 percent to 30 percent last year and agreed to maintain the same rates this year.

"The relief measures drained government coffers of over NT$200 million last year," he said.

The official also said the call for preferential loans is not needed since cash flow at most local airlines is normal.

"Airlines profited last year and their passenger capacity may have been negatively impacted, but the cargo business is growing," he said.

International airlines that fly Hong Kong endorsed the association's petition.

"EVA looks forward to the government's positive response to the petition," EVA Airways Corp's (長榮航空) spokesman Nieh Kuo-wei (聶國維) said.

He said that the government should make lowering landing fees a top priority.

China Airlines Co (中華航空) spokesperson Roger Han (韓梁中) said that his company also supported the association's requests.

Nieh and Han both said that their companies' financial situations are still manageable and that preferential loans were not needed.

To compete for passengers, EVA yesterday decided to include medical insurance along with its airfares until July 31. The deal will provide a maximum coverage of NT$200,000, with a daily compensation of NT$2,000, to passengers if they contract SARS while on the carrier's flights.

An industry watcher said that international and local airlines have been suffering losses since April and are in need of governmental help.