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AAPA Director General : "Other stakeholders must share burden"

16 Apr 2003

In a statement issued today, AAPA Director General Richard Stirland declared, "The dramatic fall in demand for air travel as a result of the spread of Severe Acute Respiratory Syndrome (SARS) across the region has had a devastating effect on the airlines of the Asia Pacific. People have simply stopped travelling or worse, been prevented from travelling by government action. Members of AAPA have been obliged to cut approximately 650 flights a week in April, with some members slashing up to 50 percent of their frequencies. I expect airlines to cancel more flights if the situation does not get better."

"While the malaise is very focused on certain countries and cities and the airlines operating from and to those destinations are suffering disproportionately, even airlines based thousands of miles away have been hit hard. Besides reducing frequencies and cutting costs within their control, airlines are looking at other ways in which their exposure to the financial consequences of SARS can be reduced.

"The airlines are only one element in the infrastructure established to provide global air transportation, others being airports and service providers, including for example air traffic control, security, immigration, customs and quarantine authorities. Many of these elements are both government operated and monopoly providers of services. It is not just desirable but vital to the survival of the existing air transport industry that these entities share the financial consequences of SARS.

"Airports and air traffic management services can and must reduce their charges, rents and other burdens which they impose on the airlines regardless of the fluctuations of the market.

"In addition, governments should look again at state provision of war risk insurance and at security charges for both passengers and cargo being paid for out of general taxation, rather than by impositions on the airlines. This is particularly urgent in view of the fact that U.S. carriers are already receiving government assistance in the areas of insurance and security costs.

"Similarly, other suppliers should be willing to take a realistic look at prices and payment terms in the light of the catastrophic situation; this includes everyone from the aircraft manufacturers to the fuel companies to the ramp handling agencies."

Richard Stirland stressed, " The airline industry in Asia has for many years been at the heart of the Asian economic miracle. In this dire situation its distress must be recognized, its crushing burden shared by those who benefited in the past from its prosperity. Narrow, sectional interests must be put aside to surmount the crisis; long-term vision must be demonstrated by governments in assisting the airlines in their hour of need."

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About the AAPA
The AAPA is a grouping of 17 scheduled international airlines based in the Asia-Pacific region. It is the trade association of the region's airlines, created to represent their interests and to provide a forum for all members to exchange information and views on matters of common concern. For more information about the AAPA, please visit the web site at www.AAPAirlines.org.
The 17 members comprises Air New Zealand, All Nippon Airways, Asiana Airlines, Cathay Pacific Airlines, China Airlines, Dragonair, EVA Air, Garuda Indonesia, Japan Airlines, Korean Air, Malaysia Airlines, Philippines Airlines, Qantas Airways, Royal Brunei Airlines, Singapore Airlines, Thai Airways International and Vietnam Airlines.