Users of Dublin airport in 2019 pay the daa up to €9.65 each time they use the airport’s infrastructure. Flying from Dublin to Stansted and back for example incurs four sets of aircraft charges, as each of the airports’ facilities are used twice.
Last month, the Commission for Aviation Regulation (CAR) proposed as part of its draft determination on Dublin airport charges that the price cap be set at €7.50 per passenger for the next five years (2020-2024). The press statement issued by the CAR stated that the proposed new price cap included all of the airport’s future investment plan, costing some €1.8bn. The CAR invited the views of interested parties by a deadline of 8 July.
The daa’s responding press statement expressed extreme concern at the proposed price cap especially because in the daa’s view the lower average charge would not allow the airport operator to implement its investment programme. On 14 June, the Irish Times reported that the airport CEO, Mr. Dalton Philips, had “stood down” work on new investment at the airport in protest at the proposed reduction in the price cap, seeking instead that the price stay close to €9.65 in the next regulatory period. Mr. Philips also set out the daa view on the Marian Finucane Show last Sunday morning (inter alia claiming the lower price cap would lead to a ‘yellow pack’ airport).
On the face of it, one might easily wonder whether higher (investment) spending could be funded from lower charges. This post is an analysis of that aspect of the proposed airport price cap.