The operator of Dublin Airport has struck after the body responsible for setting airport passenger charges released its latest decision on what was reportedly the busiest day of the Christmas season.
Passenger fees at the country’s main airport could rise from next year, sure to draw the fire out of airlines – currently in the midst of a post-Covid recovery but still facing high costs fueled by inflation.
Dublin Airport is the only airport in the country where passenger fees are regulated.
On Friday, the Commission for Aviation Regulation (CAR) announced that it had set an average base fare cap of €7.59 per passenger for the period 2023-2026 following an interim review. The fee cap will start at €7.59 next year. In 2024, 2025 and 2026 the price caps are €7.53, €7.48 and €7.77 respectively.
The current cap is €8.11.
But if inflation rises as expected and Dublin Airport can deliver its huge investment plan on time, the real fare caps just announced will be converted into nominal fare caps including inflation of €8.68 in 2023, €9.23 in 2024 and €10.30 converted in 2025 and €11.73 in 2026.
Dublin Airport’s two largest customers are Aer Lingus and Ryanair.
The Commission’s third review of pricing in 2019 was a direct response to the pandemic.
CAR said its final setting compares to the average passenger fee of €8.52 it proposed in an earlier draft.
The final fixing is also much lower than the range of €13.04 to €14.77 sought by Dublin Airport, which is operated by the DAA, the semi-public company that also controls Cork Airport.
The CAR said the prices it set would allow Dublin Airport to generate €2.8 billion in revenue. This includes €1.4 billion from airport charges over the next four years and a further €1.4 billion from activities such as retail, parking and real estate leasing.
The CAR said its pricing differs significantly from what Dublin Airport was looking for for a number of reasons.
The commission said the airport expects a slower recovery in passenger numbers than the CAR and also suggested a higher return for investors. Dublin Airport also forecast that operating costs would grow much faster than CAR’s own forecast.
The CAR has forecast passenger numbers at Dublin Airport to reach 31.7 million next year and in 2024 to surpass the 32.9 million that flew through its doors in 2019. The CAR expects that
will reach 35.7 million in 2026. The DAA expects Dublin Airport to handle 40 million passengers by 2030.
“We note the Commission for Aviation Regulation’s final decision on Dublin Airport’s fare cap for the period 2023-2026. Aer Lingus will review the content of the finding in detail in the coming days,” said an airline spokesman.
Ryanair has criticized the final decision, claiming the new charges are “unjustified”.
“The DAA should invest less time and money in wasteful vanity projects like the proposed €200m taxiway tunnel – and instead use those resources to provide lower prices, more capacity and better facilities for passengers to get through security without waiting can have long queues,” said Ryanair CEO Eddie Wilson.
In contrast, in response to the CAR decision, a spokesman for airport operator DAA said the charges were not high enough.
The DAA said the decision on passenger fees would “have an adverse impact on the number of employees the regulator will allow for vital security, cleaning and other key jobs at the airport over the next four years.”
“This goes against the interests of airport users, our passengers and airline partners, who share our desire for efficiency, quality service and investment in key strategic infrastructure,” DAA said.
“CAR advisers ban security staff each year and by 2026 up to 240 of the staff needed at Dublin Airport, severely undermining the daa’s proposal to keep queues under 30 minutes (a CAR service quality target).”
DAA said changes in passenger charges have “virtually no discernible impact on the price an airline charges for a flight” but said they “have a significant impact on the standard of customer service and the level of capacity Dublin Airport can offer as we have repeatedly warned against for several years”.
DAA said it would now consider CAR’s determination, but noted: “CAR’s decision to halt this desktop analysis on the busiest day of the Christmas season (December 23) at Dublin Airport, as CAR will close its offices until December 2. January closed while DAA staff will work over the Christmas and New Year holidays to ensure passenger reunions, holidays and homecomings are facilitated.”
DAA Chairman Basil Geoghegan said: “The Irish taxpayer is being neglected in its financial allowances for airport staff, despite the obvious needs of CAR passengers and customers,” Basil Geoghegan said.
https://www.independent.ie/business/daa-hits-out-as-decision-on-new-dublin-airport-passenger-charges-issued-on-busiest-day-of-the-christmas-season-42241522.html DAA makes decision on new Dublin Airport passenger charges to be issued on ‘busiest day of the Christmas season’