Airport surcharges are chasing vacationers south
The Kelowna International Airport is losing close to 250,000 passengers each year to airports south of the border as consumers search out cheaper flights in the United States.
And while those passengers may be better off in the pocketbook, it’s the Kelowna area economy that is hit hardest by what is a nation-wide trend that the Okanagan is not immune to.
“It’s a tremendous strain on the Canadian economy,” said Sam Samaddar, Kelowna International Airport director.
“We estimate that we could be losing between 230,000 and 250,000 passengers a year out of our catchment area.
“It affects all of the industries that are here: Tourism being one of them, the hotel industry being another.”
Samaddar was reacting to a recent study by the Hotel Association of Canada that found 21 per cent of leisure travelers said they had travelled by car the United States to purchase a less expensive airline ticket last year.
A further 11 per cent said while they hadn’t done it in 2010, they may travel to the U.S. for a cheaper flight this year.
“There is a fair bit of tax burden on the Canadian passenger these days and we know because of the difference in cost between Canada and the U.S., a lot of Canadian travelers are traveling by car to the U.S. to pick up a flight,” said Samaddar.
In the U.S., the federal government bears the cost of many of the same surcharges Canadian passengers are hit with, escalating the price of tickets in Canada.
According to Samaddar, Canadian passengers are on the hook for airport improvement fees, security fees as well as navigation fees that airlines are charged to move from one airport to the other.
“The philosophy is very different in the U.S.,” said Samaddar.
“They look at their transportation system as a national network where in Canada we are asking the users to pay for the security.
“To me, that’s a national issue.”
Samaddar said the Canadian Airport Council has joined together with other groups, like the Hotel Association, to lobby government to make changes to the way fees are handled.
“At the end of the day it boils down to cost and the consumer is going to go where it has the least impact on them,” he said, noting that it’s not a new trend but one that is impacting the economy in Canada more and more.
One area where Kelowna is better off than some is in the level of competition between airlines.
“The positive thing for Kelowna that you might not see in other airports is that we have competition between airlines so you do get competitive pricing,” he said.