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In this new installment we will analyze the success of the reduction of boarding fees in Santiago de Chile like another example to follow in the region.
The aviation continues to grow in Latin America at a good pace, but it is not free of problems or obstacles that limit the development of the industry and we can highlight two important axes, the infrastructure plus Taxes and fees.
The case of Chile
Thanks to an interesting new report generated by HIGH, We can know detailed information and statistics on the effects of the reduction in boarding fees at the Arturo Merino Benítez Airport in Santiago, that leaves us a new example for the entire region.
One of the great challenges facing the aviation industry in Latin America and the Caribbean is airline operating costs., especially the fuel, which represents close to 30% of operating costs, and fees and taxes that increase operating costs and discourage, to some extent, the ability to increase the competitiveness of destinations and turn the region into a tourism power.
It should be noted first of all, that the boarding fees at the Santiago Airport are managed by the Civil Aviation Directorate of this country and not by a private entity or concessionaire, which has facilitated decision making.
Colombia, the other example
As we reviewed in a previous installment, Colombia is taking important steps to increase its air traffic and therefore, stimulate the country's economy by generating more jobs and tourism.
For instance, Cartagena airport reduced by 2015 international shipping fee $92 USD a $38 USD. As a result of this measure, on 2015 International passenger traffic in Cartagena grew 30%. On 2016 grew a 21%, on 2017 a 20%, on 2018 a 41% and so far 2019 a 11%. Cartagena airport doubled its international traffic in a period of 3 years and three new routes that previously did not exist were inaugurated with flights to Amsterdam, Lima and Atlanta.
The airline industry stimulates the entire economy, generating direct and indirect jobs, investment and tourism, Therefore the importance of these measures, where in Colombia the implementation of a differentiated VAT for air tickets and fuel is also being analyzed.
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Let's be serious, the tickets did not go down at all. The airlines lied when they said that would lower the tickets. The tickets are the same, except that now the airlines pay less fees and less money for the state of fraud.
Airlines do not pay boarding fees, what went down, and that is what the passenger pays, not the airline. If the tickets did not go down, why the passenger flow increased?
Very good for Chile two weeks ago I passed through Santiago on a trip to Argentina and the new terminal was beautiful and they went down to 26 The airport tax continues to grow on both international and domestic flights.
In contrast, Ecuador and Argentina with more expensive rates 116 U$ international 18u$ national Quito and Buenos Aires 70 international u$ but 2$ national .
That is why national traffic grows fully in Argentina but international traffic also collapses obviously due to the Argentine economic crisis but it is also an opportunity for South American countries to wear it since it is super cheap but for that they should charge rates more in line with the Latin American reality.
The international rate of Quito is $53.
But adding all the ecodelta rates 50u$ and 10 migration and others 10 Arrival rate to the country by plane ends up being only 124U$ in Ecuador..
Obviously, those who buy from abroad do not pay the ecodelta
You are mixing fees with taxes and that is wrong..
For God's sake, if our authorities do not understand this, there is no way to do it, Ecuador per se is expensive due to dollarization for the region, not to mention our rates. Thank you for your follow-up on airport cases, I follow them closely.
Thank you Fernando for commenting.