Airlines: Concern Over Rising Operating Costs

Given the increase in port charges announced for 2020 and the high cost of aviation fuel, concern is growing among the airlines that use Costa Rica's Juan Santamaria airport.

Tuesday, November 19, 2019

According to a statement from the International Air Transport Association (IATA), Aeris, airport operator of the Juan Santamaria terminal, has confirmed that the rates will have a significant increase next year, because recent investments will be depreciated quickly to coincide with the expiration of the management contract in 2026.

For IATA, "... paying for an asset on an accelerated basis - before the end of its lifetime - results in an inappropriate increase in costs to passengers and airlines operating in San Jose, that is, a rate not related to the real cost.

Accelerated depreciation contradicts the charging principles established by the International Civil Aviation Organization (ICAO), which indicates that the charges should be related to the airport's current operating costs.
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There are other solutions, according to Peter Cerda, IATA Vice President for the Americas, "... among the measures applicable to curb the increase are an extension of the contract to the operator, the depreciation of the assets according to their lifecycle or the addition of a residual value to the assets."

Cerda estimates that the fuel price formula applied by the Costa Rican Petroleum Refinery (RECOPE) makes this item on average 20% more expensive than in other relevant airports in the region.

The position of IATA reinforces the announcement of Volaris, which days ago said that for now do not plan to execute any growth plan in Costa Rica, because the operating costs in the country will rise considerably in 2020.

Managers of the low-cost airline say that the increase in fares to Juan Santamaria airport scheduled for next year will represent a 59% increase in the cost of operation of the company in the country.

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