TWTWTW 15 June to 19 June
Monday saw most EU countries re-open internal borders but not to all citizens of all countries, leaving Schengen still fractured and travellers at a loss as to which countries they could enter without restrictions, which countries they were not allowed to visit and which countries needed which COVID-19 health documentation, tests or tracing app. To help make sense of the jigsaw, the European Commission launched a dedicated website dubbed Re-open EU offering “real-time” information covering some 30 indicators on transport, public health and tourism. Well, not really real time. When the TWTWTW team checked the platform, the information provided was updated June 10 for Denmark, June 11 for Spain and Portugal, June 12 for Belgium… Also, don’t be fooled by the Re-Open EU label. It is Re-open intra-EU. Borders into the EU remain largely shut, at least to July 1. Lastly, don’t be too excited by the plentiful of “We’re back in the air” pledges. Some 7,930 flights took place in the European network, according to Eurocontrol. While this marks the busiest day since mid-March, activity is still 81% down on last year’s levels.
We had hoped to write at least one TWTWTW blog without mentioning Lufthansa. But no such luck. The German aviation group again splashed into the headlines, this time thanks to its announcement it has a surplus of 22,000 full-time positions or 26,000 positions when including half-time contracts. Yes, that is correct, 22,000 FTEs or about 15% of its global workforce across its divisions and subsidiaries. The “personnel overcapacity,” as Lufthansa diplomatically describes it, is based on the company’s assumptions about the course of business over the next three years. Current assumptions, that is. “This excess capacity could even increase if we do not find a way to get through the crisis with competitive personnel costs,” it warned. What is the saying? Never let a good crisis go to waste.
On Tuesday IATA tabled a new set of demands to help steer its member airlines through the traditionally low-yield winter season. “Airlines are still fragile,” argued the body’s director general Alexandre de Juniac. “People are returning to the skies but the horizon of uncertainty of the COVID-19 crisis is extending. Forward bookings are down, and people are hedging their travel bets by booking closer to the time of travel.” Conclusion: airlines will need more help from governments. All help is welcome, but continued financial assistance, extensions to wage subsidies and corporate taxation relief measures and, no increases ofairport andair navigation service charges and fees are very welcome. Particularly welcome is, you guessed it, the extension of the waiver from the 80-20 use-it-or-lose-it slot rule throughout next winter season. “Governments need to grant that by no later than the end of July to provide at least that certainty for this beleaguered and battered industry,” insisted de Juniac. Roger that.
Believe it or not, but Wednesday saw Lufthansa again dominate the headlines. In the latest episode of what is becoming a soap opera-like situation, the group casted doubt over its €9 billion rescue package that it so painstakingly negotiated with the German government and that, after some concessions, received the blessing from Brussels. The culprit this time is the company’s largest single shareholder, 79-year-old billionaire Heinz Hermann Thiele. The Munich entrepreneur, who used Lufthansa’ depressed share price to increase his stake from 5% to about 15%, is against the planned 20% shareholding by the German state. “Lufthansa does not need a state participation for restructuring and recovery. If the federal government helps, it should make it minimally invasive and not be equipped with all possible rights,” he told the Frankfurter Allgemeine Zeitung. “In my opinion, not all possibilities have been exhausted,” he said. Thiele advocated Lufthansa renegotiates the deal, a move promptly rejected by Germany’s Finance Minister, Olaf Scholz. Even though Thiele did not explicitly say that he would vote against the bailout at the company’s general meeting, his comments did give Lufthansa a fright. But not for long. The group hit back and threatened it would need to file for insolvency proceedings if the rescue package fails to be approved at an extraordinary meeting on June 25. Yes, this is the same Lufthansa that two weeks ago told the world that the rescue package was more than it needed, but helpful in allowing it to secure its place at the top of the airline league table.
ACI Europe meanwhile had recovered from IATA’s blunt call to swiftly prolong the waiver from the 80-20 use-it-or-lose-it slot rule. No need to rush it as we are still four months away from the start of the winter schedule, it pointed out, stressing that an extension beyond the end of October should be data-driven, evidenced-based, and take into consideration the economic viability of the entire air transport ecosystem, including airports. According to the airports’ trade association, airlines plan to operate full programs at a number of airports for the winter season with their request for slots even exceeding those made last year for the same period. This, it noted, “indicates that airlines’ assumptions as regards activity levels are not aligned – indeed are at odds – with their request for an extension of the airport slot waiver. There is a danger here that airlines use the airport slot allocation system and the flexibility afforded by the waiver to ensure airport slots cannot be reallocated and keep competition at bay.”
Thursday saw EASA acknowledge we are in 2020 and it is time to step out of its ivory tower. Packed with new competences under the revised basic regulation from end 2018 and bestowed with even more competences on the physical wellbeing of air passengers in this COVID-19 era —a move pushed by DG MOVE and not really appreciated by DG SANTE— the Cologne-based aviation safety agency revealed a revamped website with a novel dedicated area for passengers. Dubbed “EASA Light” —not to be mistaken for the really no-frills fares passenger can buy, or maybe some new airline, although to be fair that would be EASA Lite —the passengers portal “will make it much easier for members of the public to understand the core activities of EASA and the Agency’s overall contribution to making air travel safe. The launch is particularly timely as it coincides with the restart of flight operations in Europe,” touted EASA Executive Director Patrick Ky. On Friday we were reminded that the wheels of justice turn slowly. Dashing the hopes of British Airways, easyJet and Ryanair for a quick overturn of the UK’s 14-day quarantine rules, the country’s high court will only hear in early July their legal challenge to Boris Johnson government’s quarantine measures that came into effect in early June. These require most inbound travellers to self isolate for two weeks, although there are more than 40 categories of travellers exempt. The three carriers claim that the regulations are irrational and disproportionate, their solicitors Blackstone Chambers said in a statement. BTW, the UK’s mandatory quarantine is getting a lot of consideration, although the country certainly is not alone in imposing self-isolation for incoming travellers.