SriLankan clarifies Daily FT report on ground handling move

Thursday, 25 May 2017 00:00 - - {{hitsCtrl.values.hits}}

SriLankan Airlines in a statement yesterday denied the Daily FT report published on 24 May 2017 stating that the airline intends to increase ground handling charges by 30%.

It said the reality was that the rates in existence at Bandaranaike International Airport (BIA) since 1997 would be continuing. What has been initiated however, is a process that streamlines ground handling charges with individual airlines as per services defined in the Standard Ground Handling Agreement (SGHA).

Herein there would be a few airlines who enjoyed concessions to the published rates based on previous negotiations quoting reciprocity (where that airline provides ground handling services to SriLankan at their home-base and SriLankan provides ground handling services to them in Colombo) having to pay more as a result of such benefit ceasing to exist for SriLankan.

In the same way, there are other airlines that are to benefit with reductions to charges due to published concessions based on volume as well as more services being added.

Therefore, it would be grossly incorrect to quote an increase in rates based on a few airlines losing concessions as a result of changes in the business contours.

The fact that ground handling rates have remained unchanged since 1997 is to be noted in the context of SriLankan being the sole ground handler at BIA. Also to be appreciated is the fact that Colombo›s ground handling rates remain competitive when compared with other stations in the region that have the presence of a sole handler.

It is also untrue to state that Colombo›s ground handling rates have deterred airlines from operating to Sri Lanka, as the cost considered here is a small share of an airline’s direct operating cost; hence having little or no influence over an airline’s decision to serve a specific destination. Furthermore, Colombo sees new operators commencing services to BIA every season, whilst the regular operators keep increasing frequencies.

Editor›s Note: Daily FT stands by its report.