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Time of India
28-05-2025
- Business
- Time of India
Adani proposes uniform charges for Mumbai, Navi Mumbai airports
Live Events (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel New Delhi: Adani Airport Holdings Ltd (AAHL) has asked the government to consider Mumbai and Navi Mumbai airports as a single entity for calculation of tariffs for passengers and airlines, show documents reviewed by proposal, if accepted by the government, will bring parity in charges for both the airports, likely resulting in more traffic at Navi Mumbai, the success of which is crucial for AAHL, having invested Rs 16,700 crore in building the both airports are owned by AAHL, passenger user fees, landing and parking charges will be significantly higher at Navi Mumbai, which could deter airlines from shifting to the new airport that's expected to start commercial operations in company has cited a 2021 amendment of the Airports Economic Regulatory Authority ( AERA ) Act allowing grouping of airports and designating them as a single entity. This was done to privatise smaller, loss-making airports--clubbing them with a larger one in the same region to make them attractive to investors.'Since there has been a large capital invested in Navi Mumbai, which is a green field airport, naturally tariff at the airport will be significantly higher than Mumbai, which is an established airport where capex is low and there are depreciating assets,' said a person aware of the development.'If both the airports' tariffs are calculated as one unit, the charges at both airports will be average of the two, bringing parity.'Tariff regulator AERA fixes airport charges for five years based on capital expenditure by the operator. It takes into account the airport's revenue and expenditure based on capital expenditure, operating costs, depreciation and non-aero revenue, determining tariffs so that the operator makes a reasonable has faced opposition from airlines on shifting to the new airport. The International Air Transport Association ( IATA ), an airline lobby group, said in March that the Adani group was using its ownership of both airports to forcibly move traffic to kickstart operations at Navi Adani group and the Ministry of Civil Aviation didn't respond to company announced plans to start the revamp of Mumbai airport 's Terminal 1 in October, due to which around 15 million passengers will have to be shifted to Terminal 2 and Navi difference in revenue share is another reason why AAHL wants more airlines operating from Navi Mumbai, said people involved in the to the concession agreement, Mumbai International Airport Ltd (MIAL), the company that operates the airport, has to pay 38.7% of its gross revenue with the Airports Authority of India (AAI) whereas Navi Mumbai International Airport Ltd (NMIAL) has to pay only 12.6 % of its revenue to the City and Industrial Development Corporation of Maharashtra (CIDCO).'If there is high traffic at low revenue share at Navi Mumbai airport as compared to less traffic at higher revenue share at Mumbai airport, the company will have more revenue for operating the airports,' a senior airport official said. 'So, it makes financial sense to consider them as a single entity.'Government officials said deliberations are ongoing with AAI and CIDCO on the company's proposal that would set a precedent for future cases. With as many as 15 cities having dual airports, it's necessary to establish a tariff calculation process that promotes the development of newer facilities while not burdening passengers, they a former AERA official warned that such a move may be seen as conferring an unwarranted advantage as they have different agreements and ownership structures. 'Currently, this is the only case where a single company owns both the airports in the same geography,' he said.
Indian Express
15-05-2025
- Business
- Indian Express
Mumbai airport set to increase user development fee from today
Flying through the airport in Mumbai is set to become more expensive from Friday, as the Airports Economic Regulatory Authority (AERA) approved a revised User Development Fee (UDF) that will stay in effect from May 16, 2025 to March 31, 2029. At the new rates, domestic passengers flying from Mumbai will shell out Rs 175 as UDF, while international outbound travellers will be asked to pay Rs 615. For arrival, domestic flyers will be charged Rs 75 and international flyers Rs 260. This is a big change, since Chhatrapati Shivaji Maharaj International Airport will now charge the fee both on departure and arrival — something that most Indian airports don't do. The hike, added to the airfare directly, is intended for financing a massive airport upgrade. The Mumbai International Airport Limited (MIAL), handled by Adani Airport Holdings, had sought an increased UDF of Rs 325 for domestic and Rs 650 for foreign departures. Although slightly softened by AERA, the cleared hike is seen to raise quite a lot of revenue for infrastructural development. According to sources, the increased UDF will fund a Rs 10,000 crore five-year capital spend plan for redevelopment of Terminal 1, digital system upgrade at Terminal 2, smart passenger technology adoption and sustainability efforts such as going electric and achieving net zero emissions by 2029. Earlier, the airport charged one of the lowest UDFs in the country, which was Rs 187 for international takeoffs and zero for domestic. To mitigate the effect of the increased burden on the passengers, MIAL has suggested a 35 per cent reduction in airline landing and parking fees. This might enable airlines to keep ticket prices in control. However, the real effect on fares will depend on whether the airlines take the charge on them or pass it on to customers. The new structure also corresponds with AERA's consultation paper released earlier in March, with a view to raising the Yield-Per-Passenger (YPP) at the airport from Rs 285 to Rs 332, a hike of 18 per cent. Approximately Rs 7,600 crore of the estimated investment will be recovered through the new system.
Hindustan Times
09-05-2025
- Business
- Hindustan Times
Flying out of Mumbai to cost more
MUMBAI: Starting May 16, flying out of Mumbai will cost more, with the revised User Development Fee (UDF) approved by the Airports Economic Regulatory Authority of India (AERA). A UDF is a fee levied on passengers to fund the development, maintenance and modernisation of airport infrastructure. According to the revised UDF, departing domestic passengers will have to pay ₹175 each, a nominal increase of ₹55. This section of travellers comprises 75% of the total passenger air traffic at Chhatrapati Shivaji Maharaj International Airport. The revised UDF for international passengers has been rationalised with a differential rate for economy and business-class travellers. Departing international passengers in economy class will pay ₹615 each, while departing international passengers in business class will be charged ₹695 per passenger. The Mumbai International Airport Limited (MIAL) had submitted a higher levy structure, said AERA, which 'after a comprehensive due diligence has arrived at a significantly lower Aggregate Revenue Requirement that would result in a nominal increase of 21.65% over the existing airport charges.' MIAL anticipates 229 million passengers over the next five years. The authority did not respond to HT's requests for a comment on the revised UDF. User Development Fee DOMESTIC Embarking: ₹175 INTERNATIONAL Economy Class Embarking: ₹615 Business Class Embarking: ₹695
Time of India
08-05-2025
- Business
- Time of India
From May 16, flyers to pay more for tickets as user fee for Mumbai airport hiked
Mumbai: Airfares on domestic and international flights operating to and from Mumbai airport are set to cost more from May 16, as the Airports Economic Regulatory Authority of India (AERA) has approved a hike in User Development Fee (UDF). Like taxes and fuel surcharges, UDF is embedded in the cost of the airline a "Development Fee" of Rs 120 per departing domestic passengers was levied till Aug 2024, the AERA order said. Currently, only the international departing passenger pays a UDF, levied at Rs 187."The UDF will be levied on tickets booked on May 16 and thereafter," clarified an aviation source. The UDF levy will be applicable for flights booked from May 16, 2025, to March 31, the domestic front, a UDF of Rs 175 will be levied on passengers booked on flights departing from Mumbai, and a fee of Rs 75 on those arriving in Mumbai. For international flights, the UDF fee is split further based on the class booked. International departing economy class passengers will pay a UDF of Rs 615, while those arriving will pay Rs 260. For international business class passengers, the fee is Rs 695 and Rs 304 for embarking and disembarking passengers, this, the cost of one domestic ticket to and from Mumbai will go up by Rs 250, international economy return tickets will increase by Rs 875, and for business class, the hike will be Rs 999. However, if you already booked air tickets on flights departing or arriving in Mumbai post-May 16, you do not have to pay this UDF. Those booking air tickets in the next week will also be a UDF for airport facilities is a common practice worldwide, though most airports limit it to departing in its tariff order, stated: "UDF now has been determined for both embarking and disembarking passengers as a significant portion of the airport infrastructure, including aero bridges, travelators, conveyor belts, and arrival facilities inside the terminal building, are also being used by both embarking and disembarking passengers. Therefore, distributing the overall UDF charges between embarking and disembarking passengers in a suitable proportion of their actual usage of airport facilities would lead to an equitable distribution of the tariff burden amongst the users of the airport and would also spread out the costs amongst all airport users." Airports such as Delhi and Thiruvananthapuram also levy a UDF on arriving Mumbai airport operator, in their tariff proposal submitted to AERA for the Aggregate Revenue Requirement (ARR) during 2024-29, entailed an increase of 675% in the prevailing airport charges. "However, AERA, after carrying out a thorough examination of the said proposal, has arrived at a significantly lower ARR that would result in a nominal increase of 21.65% over the existing airport charges. This adjustment will enable the airport operator to meet essential capital expenditure requirements, maintain operational efficiency, and ensure service quality," it on its calculations, AERA arrived at a Yield per Passenger (YPP) of Rs 442 per departing passenger for MIAL and distributed this between domestic and international departing and arriving passengers.
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Business Standard
08-05-2025
- Business
- Business Standard
AERA sets new tariffs, differential UDF for intl flyers from Mumbai airport
Regulator AERA has fixed differential User Development Fee (UDF) for economy and business class passengers on international flights from Mumbai airport, while the fee for departing domestic passengers has been set at Rs 175. The revised tariffs have been finalised by the Airports Economic Regulatory Authority of India (AERA) for the period from May 16, 2025 to March 31, 2029. In a move to ensure equitable allocation of aeronautical charges among all concerned stakeholders, it has been decided that the UDF for domestic passengers will be Rs 175 per departing domestic passenger, which will remain constant throughout the 'fourth control' period, the regulator said in a release on Thursday. Earlier, a charge of Rs 120 per departing domestic passenger was levied till August 2024 in the form of development fees. "The UDF for international passengers has been rationalised with a differential rate for economy and business class travelers. The UDF for the international departing passenger in economy class has been fixed at Rs 615 per pax and for international departing passenger in business class it will be Rs 695 per pax. "This adjustment aligns with the 'User Pays' principle and reflects the enhanced passenger experience and expanded facilities available and used by international travellers," AERA said. The landing and parking charges for the airlines have also been rationalised downwards and kept at reasonable levels, considering competitive airport charges at similar airports. This ensures that airline operations are not unduly burdened, and that operational efficiency is maintained, the watchdog said.
