Virus Outbreak Prompts Relaxation of '80/20' Slot Rule

 - February 19, 2020, 3:39 PM

This story is part of AIN's continuing coverage of the impact of the coronavirus on aviation.

The International Air Transport Association (IATA) is urging regulators and slot coordinators to recognize the Covid-19 outbreak as an exceptional circumstance and put in place measures to ensure airlines do not lose their historic slots for services to and from China. Not allowing for an alleviation of the 80/20 “use it or lose it” rule—requiring air carriers to operate the slots for at least 80 percent of the time in a series of five weeks to keep the entitlement in the next equivalent season—would hinder a quick recovery of air traffic when the epidemic subsides, the global airline trade body cautioned.

“What we look for is a globally aligned level playing field where airlines can adjust temporarily their schedules owing to health or safety reasons or because flying is commercially not sustainable due to a sudden drop in demand outside their control,” Lara Maughan, head of worldwide airport slots at IATA, told AIN. “We do not want an airline to fly just to preserve its slots; this is not the point of the slot rules. These aim to make the best use of scarce capacity at slot restricted airports,” she asserted. But, she stressed, “not alleviating the 80/20 rule does not help anybody.” If an airline loses its slots—on both ends of the route—it will need more time to rebuild its network and schedules. That, in turn, will leave the affected airports in an uncertain position for the next season.

The worldwide slot guidelines and the EU slot regulation 95/93 recognize reasons—force majeure events outside the air carrier’s control or extraordinary circumstances—for a justified non-use of slots. For IATA, the Covid-19 outbreak allows for a justified non-use of slots and airlines thus should not lose their grandfathered rights. The Civil Aviation Administration of China (CAAC) granted a dispensation of 80/20, initially at Wuhan Tianhe International Airport and soon thereafter waved the “use it or lose it” slot rule at its other slot coordinated airports, including Beijing Capital International Airport, Beijing Daxing International Airport, Shanghai Pudong Airport, and Guangzhou Baiyun International Airport.

The CAAC reacted with “real speed and attention to detail,” Maughan said, adding that Canada and the EU also quickly alleviated the 80/20 requirements for their home-based airlines and Chinese carriers alike. The U.S. FAA has not yet provided a clear statement and airlines do need to contact the administration on an individual basis. “But when they do, they are being perceived positively,” she said. “But this is taking a lot of time.”  

The European Commission has been “extremely helpful and has expanded the alleviation to slots for services to Hong Kong also,” Maughan noted. Not helpful, she said, was a case in which the vast majority of European slot coordinators took the “common sense and industry approach that the coronavirus accounts for exceptional circumstances, while one slot coordinator working under the same EU slot regulation took a very rigid and dogmatic approach.” That coordinator, which she refused to name, would not allow dispensation of 80/20 until Brussels issued specific guidelines.

According to people familiar with the situation, Airport Coordination Limited (ACL)—the slot coordinator for 41 airports worldwide, including London Heathrow and Dubai International—did not immediately classify the coronavirus as an exceptional situation. In an emailed statement to AIN, ACL CEO Edmond Rose said that “in the case of the Covid-19 outbreak, ACL and other coordinators are prepared to consider such alleviation for flights from China and in some cases for flights from Hong Kong, which will then result in the airlines retaining their grandfather rights to the slots.”  The airlines have to cancel any slots for which they are seeking alleviation and the slots can then be re-allocated for other flights, he added.

According to Maughan, several full freighter operators have started using some of the vacated slots for services to China because belly-hold freighter capacity has significantly decreased as international passenger flights to mainland China have almost halted.

Overall, most coordinators worldwide have positively received airlines’ requests for the alleviation of the 80/20 rule, Maughan said. “What we are not seeing is a quick enough reaction,” she added. “We need to look three to six months forward.” She also cautioned for a geographic spread of a collapse of traffic from mainland China and Hong Kong to other Asian hub airports. Slot coordinators might have to address the requirement for an 80/20 dispensation there too, she said.