ACI EUROPE HITS BACK AT CALLS TO CLOSE SMALL, UNPROFITABLE AIRPORTS

ACI Europe has reacted with dismay today to the call by an environmental group for the closure of all small regional airports across Europe unable to achieve profitability within a five-year period.

Transport & Environment (T&E) made what ACI Europe has labelled “the shocking policy recommendation” as part of an ‘analysis’ of State aid to selected airports used by Ryanair.

ACI claims that T&E’s ‘analysis’ is based on an “erroneous interpretation” of the current EU Guidelines on State aid for the aviation sector and a total disregard for the societal value of air connectivity.

According to ACI Europe, the T&E paper alleges to look at a number of “airports likely to receive State aid”, which are “likely to be loss making”.

It thus, says the trade body, only provides “a snapshot of likely State aid”.

“Clearly, sound policymaking should not be based on a snapshot nor on presumptions as to what happens in a highly competitive market” states ACI Europe.

ACI Europe goes on: “Contrary to the picture that T&E is painting, the objective sought by the 2014 EU State aid Guidelines was certainly not to eliminate operating aid to loss-making airports – nor to force them to close down.

“In fact, the Guidelines’ objectives was to preserve ‘good connections between the regions and the mobility of European citizens, while minimising distortions of competition’ in the aviation sector. 

“As part of that, the Guidelines expressly recognise the need to allow – under strict conditions & limitations – operating aid to smaller regional airports as a result of the structural profitability issues they are facing.

“Indeed these airports are handicapped by both higher costs per passenger (due to their lack of economies of scale) and lower aeronautical and commercial revenues per passenger (due to the seasonality of their traffic, less densely populated catchment areas & less affluent customer base).

“Today, 71% of airports smaller regional airports (handling less than 1 million passengers/annum) are loss making.

“In addressing what amounts to market failure, the Guidelines purposely support the vital role that smaller regional airports play for regional development – in particular social and regional cohesion.

“These airports serve as a lifeline for their communities, enabling access to essential air services (such as air ambulance) as well as economic and social integration through air connectivity.

“Since 2009, these airports have seen their total air connectivity expanding by +42.1% on the back of gains of +14% in direct connectivity and +63.5% in indirect connectivity.

Calling for the closure of all small regional airports on account that they are structurally not profitable as T&E does would not only isolate but also alienate regional communities – with considerable economic, social, political negative impacts.”

According to ACI Europe, small regional airports only account for 3% of total EU air traffic, therefore closing down those that are unprofitable would have a negligible impact on reducing CO2 emissions but, as previously mentioned, far reaching economic, social and political consequences. 

By considering only negative externalities, it warns that T&E follows an asymmetric and biased approach at odds with what the incoming President of the European Commission outlined yesterday for effective climate action.

In her speech to the European Parliament, Ursula Gertrud von der Leyen made clear that “what is good for the planet must also be good for our people and our regions” and that “we must leave nobody behind”.

“T&E’s call for closing down loss making regional airports clearly does not stand that test,” ACI Europe concludes.