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TO EVEN PLAYING FIELD CPA extends incentives to other airlines
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Posted on Aug 16 1999
The Commonwealth Ports Authority will extend the incentive it has granted to Northwest Airlines to all other airlines servicing the CNMI to prevent any accusation of discrimination, according to Carlos H. Salas, CPA executive director.
CPA has earlier approved Northwest’s request to extend its airline incentive program until October 2000 on condition that it would upgrade its aircraft from DC 10 to B747. The incentive, which took effect on May 1, 1999 was supposed to end on February 29, 2000.
Northwest has announced that it will use B747 by October this year between Guam and Tokyo, Saipan and Tokyo. such move would result in an increase in seat capacity in both markets by 32 percent or an additional 630 seats per week for each Guam and Saipan market.
The upgrade of aircraft is the result of the significant decision made by the Guam and CNMI governments, and airport authorities to reduce the aircraft landing fees in both stations, said Martin Gross, general manager for Philippines and Micronesia.
By March 2000, the incentive will be based on the new airport rate to make sure that the ports authority will be able to pay its $20 million debt.
CPA has granted a 50 percent cut in departure and arrival fees to all signatory airlines servicing the CNMI to entice them to increase traffic and revive the ailing tourism economy.
The incentive will be given to carriers that can provide an additional 15 percent increase in the total number of passengers that they bring into the CNMI.
Despite the downturn in tourism economy, CPA was forced to increase its rate because it was under pressure to generate the much-needed revenues to meet debt service coverage.
Salas said the CPA board will still conduct a study on the financial effect of extending the incentive by seven more months.
Northwest Airlines, the world’s fourth largest airline, flies daily between Guam and Saipan to Tokyo, Japan with connecting flights to nine U.S. gateways and over 250 North American destinations.
