Bengaluru International Airport Ltd. (BIAL), the operator of the Bengaluru International Airport (BIA), has decided to levy the long pending User Development Fee (UDF) of Rs 260 on all outbound domestic passengers, from January 16, 2009.

According to an official release by BIAL yesterday, the Ministry of Civil Aviation (MoCA) has given nod for levy of UDF.

Albert Brunner, CEO, BIAL said

"UDF is a crucial revenue stream for us although we have not been allowed to charge the amount we requested for. This is a beginning. The presently approved UDF is an ad-hoc. The final UDF will be decided by the ministry after further reviews or by the regulatory body appointed by the Government,”

With the crash in domestic traffic, monthly losses have zoomed in excess of Rs. 200 million per month, BIAL desperately needed the UDF. All development at the airport has been stopped by BIAL, with a lack of UDF being cited as the main reason.

Based on the September 2008 traffic, BIAL stands to earn about Rs. 66~70 million a month, which will not fully cover their shortfall. Their existing UDF request of Rs. 675 will allow them to fully cover their shortfall, but with the Ministry approving only Rs. 375 as UDF for Rajiv Gandhi International Airport (RGIA) at Hyderabad, an airport which is larger both in size and investment than BIA, I see no way for the Government to approve BIAL's request and justify their decision. Added to this a figure of Rs. 675 is considered too exorbitant by everyone.

In my opinion, a UDF of Rs. 375 would be an acceptable compromise between the needs of BIAL and the cost on passengers. Keeping in mind the total crash in regional air traffic, a segment where costs are critical, it might behoove BIAL to keep the UDF at the presently approved Rs. 260 for regional flights.

In the mean time, to make ends meet, BIAL will have to critically analyse, and reduce their expenditure. BIAL should also put the aero-city and other real-estate projects on top priority for additional income.

After 7 years, Mr. Albert Brunner will not be extending his contract with Bengaluru International Airport Ltd. (BIAL) which comes to an end in early 2009, and will step down as Chief Executive Officer.

Mr. Brunner who joined BIAL as CEO in 2002 is synonymous with the new Bengaluru International Airport. He is expected to take up another overseas assignment with the Unique Airports organisation, which operates Zurich airport, and is a partner in the BIAL consortium.

BIAL Chief Operating Officer Marcel Hungerbühler, will take over as CEO on February 1, 2009.

Marcel Hungerbühler has been the Chief Operations Officer of BIAL over the last two years and was instrumental in the start-up process and the operations of the airport. He brings with him 38 years of experience from the aviation industry and has held various high level management positions with Swissair and Swissport prior to joining BIAL.

Despite my differences with Mr. Brunner, about HAL airport, knowing him for over 4 years, he is a person, I have tremendous respect and admiration for. At a Rotary club meeting I was attending, a member asked Mr. Brunner, "What has your India experience taught you ?"; after some thought, came the answer -- "Patience"

With true grit, tenacity, and patience, over the last 7 years, Albert Brunner has guided the new airport project to a reality called Bengaluru International Airport. BIAL will miss his leadership. I wish him continued success and achievements.

Marcel Hungerbühler is an equally wonderful person. Very practical, empathetic, pragmatic, cooperative, and totally down to earth; but, I caution anyone, who would think Marcel is a pushover. He is tough as they come.

Albert has built the airport, Marcel is the perfect successor to run it. Congratulations Marcel. God bless with all the success.