At their Brussels held first Annual General Meeting, the CEOs of 14 EU carriers presented European decision makers and national regulators a comprehensive list of demands aimed at enhancing traffic flows within the block and abolishing excessive costs. Although remaining fierce competitors, through bundling their common interests legacy airlines, budget carriers and cargo operators demonstrated their mutual will to make their voices heard more effectively in the EU arena to enforce pressing goals.
That’s a lot of cash, indeed! Repeated walkouts by Air Traffic Controllers, predominantly in France, amounted to €12bn in revenue shortfalls and loss of earnings, which European carriers have
suffered between 2010 and today. “We’d like to see concrete action by the EU Commission to end these permanent ATC strikes,” urged CEO Carolyn McCall of EasyJet, when directly addressing Director
Henrik Hololei of the Commission’s Directorate General Mobility & Transport.
ATC strikes hamper employment growth
Ryanair’s straightforward speaking Chief Michael O’Leary supported her claim by dishing up critical figures. According to A4E data, 41 strike days in 2016 have pushed the overall number of strike days since 2010 to 217 accounting for over 35,000 cancelled flights and more than 7 million minutes in delays. An enormous impairment for EU carriers, leading to revenue losses of 6% and a 35 percent decrease in productivity, Michael said. Without these industrial actions caused repeatedly by a small minority in only 15 out of 28 EU member states, an estimated 140,000 additional jobs could have been created in Europe’s aviation sector, emphasized O’Leary.
CEO Willie Walsh of IAG took the same line during the meet, pronouncing that “it’s time to end holding millions of people at ransom” caused by ATC strikes. Fast settling of this annoying topic “must become the number one issue standing on the EU aviation agenda,” demanded the manager, while being applauded by his A4E colleagues.
The EU Commission takes a defensive stance
And how did EU man Hololei react to the unanimous complaints tabled by the A4E big shots in his keynote presentation? By pointing out that the Commission’s hands are tied since Air Traffic Control policies are subject to national regulators. They and their governments should be addressed by the carriers demanding a fundamental change of the current mechanisms. Nevertheless, the Estonian-national acknowledged the woes of the airlines offering his assistance for finding suitable ways out of the current plight. Europe’s aviation sector, stated Hololei, accounts for 26.4 percent of the world market. A well-functioning industry is essential for the people living in the member states, the connectivity of travelers and air freight and the Union’s entire economy. A sharp reduction of ATC strikes is necessary in order to reach this goal.
Kind words, but questionable as to whether they will lead to sustainable consequences.
A4E and Canso sign pact
However, the Brussels meet also showed that there is a ray of hope for at least minimizing the consequences of further ATC strike actions. This assumption is based on a pact annunced at the Summit between A4E and the Civil Air Navigation Services Organization (CANSO), that represents Europe’s air navigation service providers (ANSP). Both have agreed to work together constructively with A4E to enhance the performance of Europe’s air traffic management (ATM) network in the future. CANSO and A4E recognize that, where measures to help minimize the impact of industrial action on passengers and cargo transports are not already in place, for example a compulsory minimum of 72 hours notification of participation in a strike, these should be implemented by European States where possible and practical.
Walsh puts Heathrow on the dock
Other issues ranked high on the A4E agenda were excessive aviation taxes and airport charges. IAG Chief Walsh complained that: “In 2016 as much as €5.6bn were paid by EU passengers to their national tax collectors.” Having said this he referred to countries like the Netherlands or Sweden that have abolished or reduced aviation taxes, leading to immediate positive effects on the local economy, creating additional jobs, boosting air transport.
Another focus that the A4E members will put under the magnifying glass in 2017 is the aviation taxation issue. According to the association, charges at the largest European airports have increased by 80 per cent over the last 10 years while airlines reduced average ticket prices by 20 per cent. A disproportionate development.
Walsh, O’Leary, McCall and their colleagues harshly criticized the financial policies of airports, particularly those of London Heathrow that forces airlines to pre-finance their expansion plans by levying fees prior to the beginning of a project. Willie Walsh stated: “We need a mechanism supervised by independent regulators urging airports like Heathrow to take economic risks like any other market player. Instead of pleasing their stakeholders they should benefit the users.”
Clear words by Heathrow’s number one customer.
Spohr takes over from McCall
It was Lufthansa Chief Carsten Spohr when rounding off the CEO’s presentation who tabled the eco issue. He lauded the ICAO and IATA initiative, leading to the successful implementation of a global scheme in aviation to cap and reduce greenhouse gas emissions, a move which is even supported by skeptics like China, India and others. The upcoming challenge is to combine the ICAO mechanism with the existing EU ETS scheme. “As carriers we need clearance for 2017 and beyond. Airlines cannot be billed twice through two differing systems.” Spohr urged policymakers in Brussels to come to terms soon. Mr Spohr will preside over the A4E Steering Board during the next 365 days. He follows EasyJet’s Carolyn McCall, who chaired the association during the first year of its existence.
Cargolux joins in
Under Carolyn’s guidance, the former club of five grew to 14 member airlines, including Cargolux, holding up the air freight banner within A4E. “Tradeflows between the Far East and Latin America as well as to Africa could be directed increasingly via the Middle Eastern hubs are directed increasingly via the Middle East, circumventing Europe due to impending ATC strikes,” stated Cargolux CFO Maxim Strauss. This is an untenable situation which we are not willing to passively accept any longer,” Maxim reasoned whilst supporting his airline having joined the A4E club.