Aviation bodies seek airport slots relief for much of 2021

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In this news, we discuss the Aviation bodies seek airport slots relief for much of 2021.

PARIS (Reuters) – Global aviation heavyweights run by airline IATA are pushing to suspend slot access rules at airports until October 2021, they said Thursday, but will give ground low-budget carriers angry at measures they deem anti-competitive.

The draft proposal, initially reported by Reuters, was released jointly by IATA, the airport body ACI and the WWACG Slot Coordinator Association. This would prolong the current suspension of rules requiring airlines to use 80% of their take-off and landing windows or cede some to rivals.

Airport slot allocation rules have big ramifications for airline competition and market access for low-cost carriers, which were making deeper and deeper inroads before the pandemic. The current waiver expires on March 31.

“We oppose extending the slot waivers to summer 2021, as this will result in fewer flights and higher fares for consumers,” said a spokesperson for Ryanair.

“Traditional airlines at major airports will not be incentivized to operate flights,” she added. “Slot exemptions distort competition by preventing low-cost airlines from growing, while older carriers are able to reduce capacity and increase prices.”

The issue increasingly divides airlines and airports, pitting low-budget carriers largely absent from IATA with the organization’s more traditional membership.

In order to address concerns, the proposal would reinstate the “use or lose” principle during the northern summer, but reduce the rate of use required to keep slots at 50%.

“All parties agree that the normal threshold (80:20) should be replaced with a lower threshold,” says the draft document. “(The) slot requirement threshold shall be set at 50:50.”

IATA said the plan was “essential to preserve connectivity” until air traffic resumes. “The existing slot rules were never designed to deal with a prolonged industry collapse,” he said in a statement.

The proposal would also allow incumbents to bypass the 50% rule on slots they return for temporary allocation to their competitors by February – too late for scheduling, according to competitors.

It is unlikely to satisfy Ryanair or its very low cost counterpart Wizz Air.

“Wizz Air believes that any attempt to extend the current slot exemption in its entirety, partially or to lower thresholds is completely unacceptable,” its managing director Jozsef Varadi told Reuters. “Wizz Air is not participating in this effort which harms consumers, companies, taxpayers and the workforce in general.”

But easyJet, a longer-established low-budget carrier with a presence at major European airports, said it “viewed the industry proposal led by IATA as a good compromise.”

Governments will decide on any extension of the waiver and must strike a balance between competition and supporting a virtually stalled industry in long-haul markets and many regional markets.

A project with sectoral support is nonetheless bound to influence the European Commission, the US Federal Aviation Administration and other regulators, experts say.

For incumbents, it offers “protection for their slot portfolios in a season where demand is still likely too low to justify running full programs,” aviation consultant John Strickland said.

“But low cost carriers with planes available to start new services will see this as insufficient flexibility,” he added, and the plan leaves some airports “unable to accept new flight capacity while seeing revenues continue to bleed.

Reporting by Laurence Frost; additional reporting by Sarah Young in London; Edited by Edmund Blair and Susan Fenton

Original © Thomson Reuters

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