The UK government has today (24th January 2022) published its proposals for the slot utilisation rate for the upcoming summer season.
Divergence from EU Slot Rules
As the UK has left the EU, it means that the UK can now diverge from the rules already set in place by the EU. This fact has been trumpeted by the UK government. In summary, the UK is proposing the following for S’22 –
- A slot utilization rate of 70:30, meaning airlines will have to use their slots 70% of the time, in order to retain their historic rights to these slots. It is currently 50:50
- Without this change, the default position would have been the traditional 80:20
- The Justified Non-Utilization of Slots (JNUS) rules have been widened in an attempt to ensure that airlines do not operate ‘ghost’ flights
The EU had previously set its utilization rate at 64% for this upcoming summer.
The amended JNUS rules, means airlines do not have to operate flights where there are Covid-19 restrictions in place, such as a need for passengers to quarantine or if hotels and restaurants are closed. This brings the UK closer to the IATA recommendations in this instance.
The UK government has positioned this as a ‘step back towards normal rules.’ Transport Secretary Grant Shapps said that “Leaving the EU has allowed us to take back control of our airport slots rules, giving us greater flexibility to balance the needs of our magnificent aviation industry as it faces up to the pandemic. Today’s extension marks a step back towards normal rules, helping the sector to recover and grow as travel returns while protecting it against any future uncertainty.”
The Reaction from the Industry
The reaction to these proposals within the industry has, not surprisingly, been split along airport/airline lines.
Luis Gallego, chief executive of British Airways’ parent company IAG said the decision will “force airlines to operate flights with low passengers numbers, which will “generate unnecessary CO2 emissions.”
IATA have been lobbying for the current winter 50:50 utilization rate to be maintained within Europe, citing reduced demand due to the Omicron Covid-19 variant.
Willie Walsh, IATA DG, said the decision “makes a mockery” of the Government’s claims to be supporting the airline industry and the environment. “Although demand for flying is improving, passengers continue to face travel and domestic restrictions in many parts of the world, so it is inconceivable that international demand will average 70% this summer. Walsh added that “The Government is therefore condemning airlines to operate thousands of flights at low capacity which is environmentally stupid.”
The airlines argument has moved from ‘ghost’ flights to operating flights with few passengers. Airlines have been criticised for operating flights with no passengers on board, in order to keep the highly valued slots at airports such as Gatwick and Heathrow.
The airport view has been much more supportive.
Gatwick airport CEO, Stewart Wingate said the change means passengers will “once again benefit from a competitive aviation market, a wider choice of services and a range of airfares to suit different needs.” He went on: “The decision will also help generate many new routes and connections from Gatwick and provide a very welcome boost to the local economy and people across the region by supporting a wide range of new job opportunities in the coming weeks, as well as other business opportunities.”
Heathrow were also supportive saying “It strikes the right balance between driving recovery and promoting competition, which is positive for consumers, while recognising that the industry still faces uncertainty and needs support”
It was almost impossible to set a utilization rate, which would make both sides happy. Airlines will not wish to operate flights with little or no passengers but airports feel that airlines are holding onto slots that could be better used by other airlines. This was the subject of a complaint by Gatwick, Edinburgh and Belfast International airports to the UK’s department for Transport in December 2021. Together with Wizz Air, they accused airlines of ‘slot hoarding’ meaning that airlines were holding onto slots, they would never use. Wizz Air eventually purchased slots from Norwegian in order to gain greater access into Gatwick, last year.
The new regulations have to be ratified by Parliament and this should happen in advance of the summer schedule, which starts on Sunday 27 March 2022.
