IATA Demands More Concessions on ATM Fees and Slot Rules

 - June 18, 2020, 8:31 AM
IATA says that, without more government relief and lifting of travel restrictions, European airlines are facing more financial hardship in 2020. [Photo: London Gatwick Airport]

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

The International Air Transport Association (IATA) has stepped up calls for more government support and a wide-ranging set of coordinated measures between states in a bid to avoid lasting damage to the airline industry. At a press briefing on Thursday, Rafael Schvartzman, the group’s regional vice president for Europe, warned that there could still be “worse to come” for the industry. He is concerned for what carriers on the continent are facing next winter given that he does not expect the summer season to provide the usual financial “cushion” and expressed concern that government support for measures such as staff furloughs is set to dry up.

In addition to demanding a consistent approach to opening up borders to restart commercial flights, IATA urged air navigation service providers to make concessions around €2 billion in air traffic management fees that will soon be due for payment by European airlines. It also asked European regulators to extend the waiver granted for the so-called 80-20 use-it-or-lose it slot allocation rules through the end of the next winter season.

On June 17, the Airports Council International’s (ACI) European branch said that it opposed an extension to the slot waiver on the grounds that it has resulted in, “high cost to airports as it allows airlines to declare full schedules, hold on to the requested slots and cancel their flights close to the date of operation, leaving airports with the operational costs involved and no revenues to cover them.” According to ACI Europe director general Olivier Jankovec it is premature to extend the waiver now, but IATA has insisted that airlines need plan schedules for the winter season during August.

According to data released by IATA, airlines in Europe are set to lose $23.1 billion in 2020, with passenger demand (as defined by revenue passenger kilometers) set to be 56.4 percent down from 2019, while available seat capacity will only be cut by 42.9 percent, resulting in excess capacity.

Schvartzman told reporters that the economic outlook has worsened in Europe since IATA issued its last airline market forecast in April. The association now sees lower passenger numbers, increased numbers of jobs at risk, and falling GDP in all European countries.

“Europe’s economies have been brought to their knees by Covid-19, and the aviation industry has been especially hard-hit,” he said. “Recent optimism over the opening of the Schengen borders should not obscure the critical seriousness of the situation.” IATA says that more than six million aviation-related jobs are now at risk in Europe.

The organization called on governments to allow a “coordinated restart” of commercial aviation services, based on the public health safeguarding measures captured in recently issued ICAO guidelines and largely mirrored in recommendations from EASA and the European Centre for Disease Control. It argued that if these measures are universally adopted, there would be no need for the quarantine requirements imposed by countries such as the UK and Spain that IATA said present a “huge impediment” to air traffic recovery. It presented results from a new passenger survey showing that between 76 and 83 percent of European travelers will not travel if quarantine is in place.

Asked by AIN whether IATA expects the European Union to lift its ban on non-essential travel into its 27 states after June 30, Schvartzman said he is hopeful of some relaxation while warning that it will likely be incremental. Referring to ongoing discussions with governments beyond Europe, he suggested that the EU may retain the ban for countries based on an assessment of their Covid-19 status. “I am confident it will happen, but it will be gradual and that’s why we are seeing this level of losses, but in the third and fourth quarters we would expect to see a gradual lifting of [travel] restrictions,” he said.

Schvartzman acknowledged that some governments, especially those outside the EU, such as the UK, are considering plans to allow flights between specific countries as defined by so-called air bridges or travel corridors. However, he said that the framework for how these might work has not been adequately defined while repeating his call for countries to take a coordinated and consistent approach to allow flights to resume.