Civil aviation policy proposals: Hybrid till model across airports will inflate airfares, say experts

• Posted in Aviation
• on July 5, 2016
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This runs contrary to the new policy’s objective of making air travel more affordable.
Airport charges are universally determined under single till, double-till and hybrid-till mechanisms. In all cases, airport operator gets a predetermined internal rate of return (IRR) as per the concession agreement. Under single-till mechanism, revenues from both aeronautical (landing, parking and ground handling) and non-aeronautical (duty-free shops, hotels, restaurants and airport infrastructure) segments are taken into account to determine the IRR.
However, under the hybrid till method, which is currently being used by joint venture airports, only 30 per cent of non-aeronautical revenue is taken towards IRR, allowing the operator to pocket 70 per cent of the non-aeronautical revenue. The idea is to encourage the operators to expand airport infrastructure. But the lower revenue base compared to single-till method practically prompts the operators to levy higher charges (UDF) on passengers and airlines. Deion Sanders Womens Jersey

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