Saturday, October 16, 2021

Tougher EU airport slot rules trigger Asia retaliation threat, risk industry trade war

Regulators in Asian hubs such as Hong Kong have threatened to retaliate against an EU plan to force airlines to start using frozen takeoff and landing slots during the coronavirus pandemic, a move that has hit Europe’s carriers. to fly thousands of miles in empty seats.

Officials controlling slots at major Asian airports are set to slap similar ‘use it or lose it’ conditions on European carriers flying to cities in Asia – a take on the disproportionate impact of COVID-19 industry raising the possibility of a trade war.

After a rare unity during the pandemic, when carriers were being pulled out or trying to stay afloat, industry leaders say the controversy has rekindled fundamental differences in a fragmented region as the world is a multi-faceted world. – Stages the recovery of speed.

“Is this a trade war? Definitely the germ of one,” said former Australian aviation negotiator Peter Harbison, chairman emeritus of the Sydney-based CAPA Center for Aviation Consultancy.

“And it will be pronounced as more airlines collapse and international markets remain closed, or at best, uncertain.”

Tensions have risen since July, when the European Union announced plans to force airlines to use 50 percent of their rights or lose them to rivals from next month. That move partially waived reinstated competition rules as airlines struggled to survive the pandemic.

But while the EU decision reflects a traffic recovery that is well underway in Europe’s predominantly short-haul market, Asian carriers are protesting that they will be unfairly penalized because of their long-haul networks. Will take longer to recover.

In Asia, longer quarantines for passengers and airlines operated just 14 percent of their 2019 international capacity in July, down from the 2019 levels seen in Europe at 46 percent and North America at 48 percent, according to International Air Shows Transport Association (IATA) data.

Cathay Pacific warned publicly last month that the slow recovery in Hong Kong meant it risks losing prized overseas airport slots and damaging the city’s hub status.

Taiwan’s China Airlines and Korean Air Lines expressed concerns about EU rules in statements to Reuters.

In Europe, Lufthansa—the EU carrier with the most flights to Asia—said that tougher EU regulations could ultimately hurt the climate as well as airlines if they had to fly empty planes to keep slots. is forced to. Air France and KLM said their decisions to fly were not based on airport slots.

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‘Shock phase’ over

The EU broke global industry recommendation and made tighter rules for the winter schedule season, which runs from October to March, following heavy lobbying by low-cost carriers such as Ryanair, large short-haul networks and European airports. Along with, many of which are privatized and trying to produce returns.

“We are no longer in a state of immediate shock,” said Aidan Flanagan, safety and capacity manager at Airports Council International Europe. “We are now in a position where the market is stable, with significantly lower levels than in 2019, but it remains stable.”

The European Commission said in July that a 50 percent utilization rate – down from 80 percent in normal times – was chosen to ensure good use of airport capacity and benefit consumers. It also made exceptions so that airlines are not required to reach 50 per cent, while strict measures such as quarantines that make travel difficult remain in place.

The commission did not immediately respond to a request for comment.

6 weeks to reply

Once travel restrictions are lifted, Asian carriers will have to promote flights to the EU within six weeks or risk losing slots even if there is slow demand for return.

“It is unreasonable to expect people to work when there is no demand,” said Lara Maughan, IATA head of Worldwide Airport Slots. “It’s really a small window in which to reorder that whole operation once the restrictions are lifted.”

René Mesokolua, managing director of German airport slot manager FLUKO, said his organization had been informed that some Asian countries were telling European airlines that they would be required to fly 50 percent or lose their slots in retaliation for EU rules. would be at risk.

Hong Kong and South Korea are among those taking a tough stand against European carriers, an industry source said, who was not authorized to comment publicly on the matter.

Hong Kong officials confirmed that reciprocal provisions are in place, but declined to comment on specific matters.

The Korea Airport Schedule Office did not respond to a request for comment, but Korean Air, a member of the country’s slot working group, confirmed the provisions.

Meanwhile, the United States on Thursday announced more liberal winter weather rules for international carriers than the European Union, despite the potential for conflict between Asia and Europe.

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This News Originally From – The Epoch Times

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