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European airports report on crisis fallout, renew call for competitive relief measures

Direct News Source

12-Nov-2009 European airport trade body ACI EUROPE today released a fresh report on the impact of the crisis on the airport sector, entitled Renewed Call for Competitive Relief Measures.

With 82% of European airports reporting falls in traffic so far this year and more than 105 million passengers expected to be lost by the end of 2009, European airports are experiencing their worst ever trading conditions.

Falling revenues resulting from declining passenger numbers and airlines' capacity reductions, combined with higher capital costs, have severely deteriorated financial performance across the sector. This has prompted far reaching cost cutting, including staff reductions of 20% or more at several airports, as well as €2.8 billion reduction in capital expenditure for the top 25 European airports.

Although there are tangible signals that the air traffic downturn is bottoming out, the pace of air traffic recovery in the winter will remain slow and gradual - mainly driven by low cost airlines. A sustained recovery is unlikely before mid-2010, with the first half of the year expected to grow only marginally.

Against this background, European airports have nonetheless confirmed the bulk of their capital investments - standing at €50 billion for 2008-2013. The long lead-times involved in airport development and the fact that air traffic will double by 2030, leave limited margins of manoeuvre for reducing investment levels. This is about being ready for the rebound, and delivering the facilities that will be needed by airports' communities, the travelling public and airlines. In the short-term, these investments will make a significant contribution to economic recovery and job creation.

At the same time, European airports have reconsidered their charging policies vis-à-vis airlines in a responsive and responsible way. Whenever possible, they have decreased their charges, froze them or reduced initially planned increases. This is about safeguarding their competitive position in the crisis to protect their route network and incentivise traffic recovery.

As aviation continues to be one of the most affected industries by the global crisis, ACI EUROPE is renewing its call to the EU and national governments for competitive relief measures benefiting all aviation industry stakeholders.

Olivier Jankovec, Director General ACI EUROPE said "Just like other sectors of aviation, airports are being hard hit and face both the prospect of slow air traffic recovery and structural market changes. We are not asking for hundreds of billions of euros in financial aid. We are simply asking for a true industrial policy for aviation - a policy which focuses on the competitiveness of the European aviation system and the unique role it plays in fostering economic growth by connecting people, places and businesses."

He added "This means that the absolute priorities should be: 1 - Do not add costs for the industry through new regulatory initiatives and reduce existing costs, in particular by repealing unjustified taxes and providing public financing for aviation security. 2 - Incentivise traffic recovery through full liberalisation of aviation and more flexibility for start-up aid at regional airports. 3 - Keep focused on long term