Airlines for Europe (A4E) is urging the European Commission to promptly extend the dispensation of the 80/20 use-it-or-lose-it slot rule for the entire winter season, calling its plea “totally justifiable” given the ongoing uncertainty of Covid-19 on travel restrictions and the recovery of demand. Speaking to media on Wednesday, A4E chairman and Air France-KLM CEO Ben Smith asserted that the gradually built-up slot portfolios stand as the “bedrock of the business models of our members. We bought airplanes based on slots being available.”
He acknowledged that airlines “have too many slots based on demand” but warned that they might have to operate unused slots with empty flights—known as ghost flights—in the upcoming winter season if regulators don't prolong the current waiver of the 80/20 slot rule. Such a decision, he said, would exacerbate the already huge losses European airlines expect because of the pandemic and have an “unnecessary negative impact on the environment. So it would have a double impact for us.”
The International Air Transport Association estimates that European will record €19 billion ($21.8 billion) in losses this year. The winter season is typically difficult for European airlines but “this winter will be worse” and "very challenging," said Smith.
The EU suspended in March the obligation that requires air carriers to operate slots for at least 80 percent of the time to keep the entitlement in the next equivalent season through October 24. A4E wants an extension of the waiver through March 27, 2021. The trade body, which represents Europe's largest airline groups across business models, believes the commission can deliver the dispensation via a so-called delegated act rather than having to draft a new amendment to the EU slot regulation 95/93, which would need approval from the European Parliament and the Council of the EU.
Transport Commissioner Adina Valean earlier this week indicated that the European Commission is open to prolonging the waiver for at least part of the winter season, a statement that Smith labeled a “first positive step.” However, he stressed that A4E will continue to put forward its argument that airlines need the waiver for the whole winter season.
To obtain a full-winter-season waiver, Smith appeared willing to accept a “code of conduct” to address complaints of ACI Europe that airlines have acted too late in handing back unused slots, preventing airports and slot coordinators from offering them for essential cargo flights or experimental flights.
A4E managing director Thomas Reynaert also cautioned that airlines might not be able to pay air navigation service providers until "maybe 2021." Under a deal brokered by Eurocontrol in April, the body’s member states agreed airlines could defer €1.1 billion ($1.3 billion) in air traffic control fees to help them deal with the sudden and significant cash flow crisis. The agreement requires airlines to start to pay back the deferred charges between November and the end of the first quarter of 2021. “This is money the airlines don’t have, unfortunately, and won’t have for some time,” Reynaert noted.