EC slot restrictions anger Euro regionals

 - May 19, 2008, 12:12 PM

The European Commission (EC) has issued long-awaited slot-allocation reforms that would allow slot coordinators to exclude aircraft “below a certain size” from airports and give lower priority to scheduled air routes on which “satisfactory service by other means of transport [such as road and rail] exists.” The proposals, published June 28, have provoked furious opposition from the European Regions Airline Association (ERA), which has accused the EC of pushing through contentious market access-related changes in a package of proposals that was supposed to cover strictly technical procedures for slot coordinators.

While forwarding the initial proposals for consideration by the European Union’s Council of Ministers and Parliament, EC vice president for transport and energy Loyola de Palacio also instructed her staff to begin yet another wave of study and consultation aimed at introducing a “market mechanism” for the allocation of slots (most likely a system of auctions or leases). No timetable has been set for this more radical second phase of reforms, which are expected to favor major airlines at the expense of regional airlines and other smaller operators.

The first set of proposals has now started to work its way through the legislative processes of the European Council and Parliament. It is expected to be formally referred to the Parliament’s Transport Committee within the next few weeks, although progress will likely be slowed because of summer recess. Nonetheless, ERA officials warned that “the legislative clock is now ticking,” and implored members to back an urgent campaign to get the proposals overturned.

ERA is now lobbying hard to have what it considers to be market-sensitive proposals dropped from the supposedly technical reforms and shelved for discussion under the second phase of study and consultation. The association also objects to a proposal requiring coordinators to give new services priority over the re-timing of existing services and for preference for “new entrants” on services between congested hubs and regional airports.

According to ERA air-transport policy director Andrew Clarke, the EC’s definition of a regional airport would exclude many airports that specifically serve local communities in Europe. Furthermore, the association has alleged, the EC’s  plan to encourage new operators would be undermined by its declared intent to discriminate against “smaller aircraft” and routes that are deemed to have satisfactory ground transportation links. Clarke also complained that the EC’s definition of “new entrant” would effectively exclude the increasing number of European regional airlines that operate in some form of partnership or alliance with major carriers.

The EC has declared its intent to tighten “use it or lose it” rules governing slot allocation, while promising not to make “radical” changes to time-honored “grandfather rights.” At least 12 of the 15 EU member states are understood to have opposed early EC plans to allow heavily deregulated slot trading, leading to the watered-down proposals published in late June.

The Association of European Airlines (EAA) representing larger carriers, has also slammed the EC proposals on the grounds that they seek to stimulate “new entrants” without correctly addressing actual market conditions. EAA has objected  that the EC team has focused on airport pairs rather than city pairs, ignoring that many new low-cost carriers are bypassing major airports to use those more distant.