H1 Overflight Revenues Down 46%

EghtesadOnline: Iran Airports Company’s revenues from overflight charges decreased by 46% or $69 million in the first half of 2020 compared with the same period of 2019, according to Siavash Amirmokri, managing director of the company.

News ID: ۷۵۰۸۸۸

05 September 2020

The official noted that optimistic projections put the number of aircraft flying over Iranian airspace during 2020 at 112,000 and expected revenues to reach 10,000 billion rials ($40 million).

However, he added that a 47% decline in passenger traffic is expected at Iran’s airports by the end of 2020, IRNA reported.

“The total number of international passengers at Middle East airports will decrease by 102-113 million and revenues in this sector will be down by $18-20 billion during 2020. The number of domestic passengers in the Middle East will also decline by 21-24 million and revenues will drop by $2 billion,” he said.

Latest data released by Iran Airports Company show international air traffic in Iran is beginning to experience growth after the spread of the new coronavirus brought a significant slump in both passenger and cargo sectors.

The IAC data show the number of international takeoffs and landings, as well as the handling of passengers and cargo, during the fourth month of the current Iranian year (June 21–July 21), saw a 100%, 89% and 100% increase respectively compared with the preceding month.

In case of domestic flights, the takeoffs and landings increased by 2% while the handling of passengers and cargos fell by 2% and 11% respectively compared to the previous month.

The total number of takeoffs and landings during the month under review registered a 3% rise compared to the preceding month.

However, the total number of passengers and the volume of cargos handled during the period witnessed a 2% and 6% decline respectively month-on-month.

In the fourth Iranian month (June 21-July 21), a total of 21,767 takeoffs and landings were registered, which indicate a 28% decline from the similar period of last year.

More than 1.94 million passengers and 14,328 tons of cargos were transported during the month, indicating a 45% and 51% YOY drops respectively.

The report shows 21,552 takeoffs and landings were registered by domestic flights from June 21 to July 21, down 23% YOY. Over 1.93 million passengers and 12,960 tons of cargo were transported domestically, indicating a 39% and 44% decrease respectively YOY.

On the international front, 215 takeoffs and landings were registered, showing a 91% decrease YOY. A total of 8,605 passengers and more than 1,367 tons of cargo were transported to and from overseas destinations, indicating a 97% and %78 falls respectively YOY.

Iran Airports Company is an arm of the Ministry of Roads and Urban Development, which manages 54 airports across the country.

Plan to Offer Discount

Iran is drawing up plans to offer discounts to some foreign airlines using its airspace, IRNA quoted a senior aviation official as saying recently, after a slump in flights due to the coronavirus pandemic and regional tensions.

Nasser Aqaei, director of the state-run Iran Airports and Air Navigation Company, said the discounts would go to the top eight airlines providing transit income as well as airlines boosting their flights by 20%.

However, no general cut in fees are planned, IRNA reported.

Iran is one of many countries that charges overflight fees, which are generally used to fund services such as air traffic control, weather data and aeronautical information, Reuters reported.

The planned discounts still have to be approved by the government, Aqaei added.

Saeed Akbari, an official with Iran Airports Company, said in April that following the outbreak of the novel coronavirus, overflights have reduced to an average of 110 per day.

"The highest number of overflights these days has been 117 whereas between 900 and 1,000 flights passed over Iranian airspace per day in the first half of last year [March 2019-20]," he added.

Noting that overflight and airport services’ fees are the only sources of income for Iran Airports Company, the official said, it is facing a severe resource crunch.

“IAC is a government-run company and does not have the option of resorting to downsizing. On top of that, our employees are mostly the elites of the aviation industry so we can’t afford losing them,” he said.

Akbari stressed that even when the coronavirus outbreak ends, it would take a long time for the company to recover from this latest blow.

“The company may have to stop its ongoing development projects and cancel new contracts or implement pay cuts to stay afloat,” he was quoted as saying by the Persian-daily newspaper Etemad.