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Tuesday, November 5, 2024

Higher charges to support SMC investments in NAIA

The Department of Transportation (DOTr) said Friday the higher airport charges and passenger terminal fees at Ninoy Aquino International Airport (NAIA) would enable the San Miguel Group, the new concessionaire, to recoup some of its investments.

DOTr Secretary Jaime Bautista said the airport charges, which include landing and take-off as well as parking fees, would increase before end-2024.

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“Airport charges are not a big percentage of the airline’s expenses. We are working with the airlines on this,” he said.

Bautista also said passenger terminal fees would also increase by 2025.  He said the proposed increase to P950 from P550  is subject to review by the interagency committee.

“The last increase was in 2000, so [it has been] 24 years without an increase. We also have the lowest passenger terminal fee if you compare it to other airports in other countries,” he said.

“It’s about time.  We need to implement reforms. We need to modernize the airport, so if we want a better experience, of course there will be a cost,” he said.

Bautista said the government is on track to turning over the operations and maintenance (O&M) of NAIA to SMC Group within the year.

The SMC-led New NAIA Infrastructure Corp. (formerly SMC SAP & Co. Consortium) signed a P170.6-billion contract in March 2024 to operate, maintain and upgrade NAIA for 15 years, extendible for another 10 years.

San Miguel Group earlier said it is mobilizing at least P88 billion in capital investments within the first six years and at least P122.3 billion in capital investments for its entire 25-year concession period.

The government expects to generate P900 billion in revenues in the course of the 25-year concession period, inclusive of the P30 billion upfront payment, P2 billion annual payment and 82 percent government revenue share.

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