At RDC, we've been taking an in-depth look at the charges in place at more than 3,000 airports available within our AirportCharges platform and found that not only can charge calculations involve multiple steps with hard to identify input parameters, but that the selection algorithms required to correctly identify the correct charge calculation to be used can be incredibly complex.
Passenger Charges - how hard can they really be?
When people think of passenger charges at an airport (which account for c60% of an average turnaround cost), the starting position for many is to think that most charges can be condensed to a unit rate applied on a per passenger basis and that the decision of which charge to apply might be as simple as deciding between a domestic and an international service. This can be the case: take (FRA/EDDF) Frankfurt International for example, where the calculation is relatively straight forward (involving the removal of transit and transfer passengers) with a couple of choices based on destination type.
(FRA/EDDF) Frankfurt International’s PLS calculations and selection criteria
But even for PLS charges, one of the most universal charges in place across the world, things can soon get complex. To identify the correct PLS charge rate at (MAN/EGCC) Manchester International (a place close to my heart), the time and date of the flight, the number of annual movements operated by the carrier, the noise QC of the aircraft and the Stand Code of the aircraft must be known to correctly chose one of 27 charge calculations. The airline would also need to know the peak and off-peak timing bands in place at the airport, as well as the seasonal date bands in place.
Movement Charges - just a unit rate multiplied by the MTOW, right?
Moving beyond passenger charges, the determination of which movement based charges should be levied (which account for c40% of the cost for a turnaround on average and include charge items such as landing fees, noise & emission charges and infrastructure rates) can be incredibly specific and involved. Starting off with the most simplistic charges, such as those at (NQY/EGHQ) Cornwall Airport Newquay, the only input needed is the MTOW of the aircraft and then the calculations are very easy to apply:
(NQY/EGHQ) Cornwall Airport Newquay’s Runway calculations and selection criteria
At the other end, some airports differentiate charges by factors such as the type of airframe, the movement type, the noise QC of an aircraft and whether an aircraft is on a specific bonus list, as well as considering time of day, seasonality and MTOW of the aircraft. These complex considerations are more likely to be found at European airports, such as (CGN/EDDK) Cologne Bonn where 29 different combinations of the above factors need to be considered to arrive on the correct charges for landing fees (examples of which are shown below):
Examples of (CGN/EDDK) Cologne Bonn’s Runway charges and selection criteria
Yes, but all the inputs are simple, right?
Finally, the inputs needed to accurately calculate the charges can be hard to identify or might not be commonly known. So while MTOW and the number of passengers on board are easily identifiable by the airline or airport, factors such as NOx emissions per engine or Approach and Flyover noise values, might only be known to colleagues in technical flight departments (such as (HND/RJTT) Tokyo Haneda’s noise charges, shown below):
(HND/RJTT) Tokyo Haneda’s noise charge calculations and selection criteria
Surely everyone wants simplicity - so why is it so complex?
Why an airport’s charges are structured they way they are comes down to many factors. From a regulatory “user pays” perspective, some airports introduce very refined charges to be as fair and transparent about who pays for what they use, particularly for things like infrastructure charges, air bridge usage, PCA etc. Some airports use their charges to try and influence behaviour from their operators, such as discouraging the use of noisy aircraft with noise charges, charging users more for landing at time at night time (to discourage night flights and thus reduce noise complaints), or to encourage better use of the airport infrastructure during quieter times (through reduced charges in off-peak / winter periods). Some airport’s charges are just poorly thought out, without really considering the impact on a user trying to determine the correct charges to be imposed.
Over time, as an airport grows and develops in different ways, additional charges tend to be added to reflect the changing investments made, or to reflect changes in operations. And because no-one likes change, making wholescale adaptations to charging structures happens very infrequently - new charges tend to get bolted on to existing charges, rather than undergoing a holistic review.
How can AirportCharges help?
AirportCharges has grown as a platform to include charges on more than 3,000 airports around the world. We make it easy for users to accurately calculate the charges which they would be subject to, regardless of how complex an airport’s charging structure, calculations and selection algorithms are.
Banner image by CHUTTERSNAP on Unsplash
