Vancouver International Airport (YVR)

Aeronautical fees to hold the line for next 5 years

Fuel Tax Eliminated by 2012 and YVR maintain aeronautical fees at 2010 levels until 2015

Vancouver International Airport is positioning itself for growth by freezing landing and terminal fees charged to expansion-minded airlines while the B.C. government plans to scrap its aviation fuel tax on overseas and transborder flights. Canada’s second-largest air terminal is willing to forgo extra revenue from landing and terminal fees because it still gains from the economic spinoff benefits of increased traffic, including more customers for the airport’s shops and restaurants, said Tony Gugliotta, senior vice-president of marketing and business at the Vancouver Airport Authority. Mr. Gugliotta said Monday that the “aggressive” plan calls for the Vancouver airport to hold the line on the fees, starting next year and lasting through 2015, for carriers that add seat capacity. Air Canada and WestJet Airlines Ltd. praised the new program for keeping the airport charges at 2010 levels. Industry observers say the Vancouver airport’s announcement goes beyond Toronto’s Pearson International Airport’s recent moves to boost traffic. Canada’s largest air terminal offers a 60-per-cent cut in first-year landing fees in an incentive program targeted at carriers that launch new routes into underserved or overlooked destinations. Pearson also offers a 50-per-cent, first-year discount to airlines that introduce additional flights or seat capacity along their existing network. The two airports’ efforts to bolster traffic are necessary because aviation executives are frustrated by a regime of government fees and taxes contributing to higher airfares, observers say. Those rising ticket prices have pushed many Canadian consumers to American airports, including in Seattle and Bellingham, Wash. Mr. Gugliotta and Vancouver airport president Larry Berg said they’re pleased with B.C. Premier Gordon Campbell’s pledge to eliminate the province’s tax on jet fuel of 2 cents a litre on international and transborder flights into the United States, effective April 1, 2012. Mr. Campbell, seeking to build on the tourism momentum from the 2010 Vancouver Winter Olympics, said the tax cut will help the Vancouver airport’s quest to be “the preferred gateway to North America,” notably for tourists visiting from Asia. More flights through the Vancouver airport, “particularly with our new approved destination status with China, means substantial economic benefits for B.C. through increased tourism revenues and job creation,” the Premier said in a statement Monday. David Goldstein, president of the Tourism Industry Association of Canada, called on Ontario to cut its tax of 2.7 cents a litre on jet fuel. Officials at the World Routes 2010 aviation conference in Vancouver estimate that carriers will save from $2,000 to $3,000 for a long-haul flight, once B.C. cancels its aviation fuel tax in 2012. Competing U.S. jurisdictions do not charge fuel taxes on international flights.

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• Posted 15/10/2010