IATA Slams 30% Increase in North Atlantic Airspace Fees

 - November 29, 2022, 8:16 AM
Air navigation service providers in Iceland and Denmark are responsible for managing some sections of airspace over the North Atlantic. (Image: NATS)

The International Air Transport Association (IATA) has demanded that Danish and Icelandic air navigation service providers (ANSPs) scrap increases averaging 30 percent for fees paid by airlines to use routes across the North Atlantic. On Tuesday, the industry group complained that the increases due to take effect on Jan. 1, 2023, were announced by the two air traffic management agencies without any user consultation.

“This is a cash grab by two monopoly suppliers with no justification. It must be stopped,” said Peter Cerda, IATA’s regional v-p for the Americas. “Why should airlines pay a higher price for a service by a monopoly supplier that has not changed and with nothing to justify the higher cost? Rather than ramping up charges, the providers should be looking to achieve efficiencies that will keep costs under control. And if efficiencies cannot be found, then it is time for these suppliers to sit in consultation with their customers to review proposals.”

IATA called for a consultation in accordance with ICAO guidelines. It said that a transparent process for reviewing airspace fees should include an analysis of differences in the ANSP cost structures, traffic data for the past five years, and a forecast for traffic in 2023.

The group said it has lodged a formal complaint with both the Danish Transport, Construction, and Housing Authority and Iceland's Isavia ANS agency. Denmark oversees the management of airspace around Greenland.

During a Royal Aeronautical Society conference in London on November 29, IATA head of economics Andrew Matters said factors such as reduced disposable income and rising airline ticket prices are making it challenging to predict future traffic growth. Nonetheless, the association expects the overall number of passenger journeys to double by 2040 to 7.8 billion.

Matters told conference attendees that the Asia-Pacific region will see the strongest annual growth rate over that period at an average of 4.5 percent, compared with just 2.3 percent in Europe. As the air transport industry strives to meet its net-zero carbon objective by 2050, IATA sees the adoption of sustainable aviation fuel as making the biggest contribution (65 percent of the total emissions reduction), followed by offsetting or carbon capture (19 percent), the introduction of new technology (13 percent), and changes to infrastructure and operations (3 percent).