Monday, Feb 13, 2012
--Etihad to up fuel surcharge by $3 per passenger on European flights starting March 1
--Strongly opposed to unilateral measures imposed by the EU, CEO says
By Alex Delmar-Morgan
Of ZAWYA DOW JONES
DOHA (Zawya Dow Jones)--Abu Dhabi-based Etihad Airways said Monday it will increase its fuel surcharge by $3 per passenger on European flights starting next month to offset the costs of the European Union's emissions tax system.
The increase of $3 per passenger for flights into and out of Europe and $0.03 per kilogram for cargo shipments will take effect from March 1, Etihad said in an emailed statement.
The European Union's emission tax on airlines, effective from January 1 this year, mandates that carriers hold permits for the carbon dioxide emitted during flights in and out of the EU member-countries. The scheme aims to reduce the industry's carbon footprint through a cap-and-trade mechanism that limits permissible emissions.
Most aviation industry leaders on Monday, speaking at the Singapore Air Show this week, continued to mount criticism and opposition to the ETS.
Several countries like the U.S., Russia and China have expressed opposition to the ETS, with China earlier this month forbidding its airlines to pay the carbon tax, escalating the dispute.
While it is unclear whether a global agreement is possible by April 2013, when airlines are due to make the first set of payments, IATA has called for deferring the implementation of the ETS.
The EU Transport Commissioner Siim Kallas meanwhile said in an interview that although the EU is willing to be flexible with its emissions tax on airlines, it won't suspend the tax unless countries can agree on an ambitious alternative.
"As an airline we are strongly opposed to the unilateral measures imposed by the European Union on our flights into and out of Europe, especially as they include areas outside European airspace," Etihad Chief Executive James Hogan said in the statement Monday.
Middle East airlines, who have invested in modern fuel-efficient aircraft, oppose the scheme, saying costs will soar.
State-owned Gulf carriers Etihad, Dubai's Emirates Airline and Qatar Airways are among the three fastest growing airlines in the world. Their dominance has however drawn criticism from more established U.S. and European carriers who accuse the Gulf trio of receiving unfair subsidies and tax breaks.
-By Alex Delmar-Morgan, Dow Jones Newswires; +974 6659 9818; alex.delmar-morgan@dowjones.com
Copyright (c) 2012 Dow Jones & Co.
(END) Dow Jones Newswires
13-02-12 1442GMT
