Aircraft operators flying in European airspace will face higher air traffic control (ATC) charges starting in 2023 to cover up to €5.4 billion ($6.6 billion) in Covid-related losses by air navigation service providers (ANSPs). Five leading airline and business aviation trade groups have protested last week’s decision by European Union (EU) member states to require ANSPs to compensate for their deficits through higher charges.
According to a joint statement by Airlines For Europe (A4E), the European Regions Airline Association, the European Business Aviation Association, the European Helicopter Association, and the International Aircraft Owners and Pilots Association, the EU member states rejected the European Commission’s recommendation that they should take the long-term effect of Covid on airspace users into account when setting revised financial performance targets for ANSPs. The groups maintained that European airlines are not expected to recover financially until at least 2024.
According to the industry groups, the ANSPs based previous income targets on traffic volumes in 2019; those volumes declined by more than 60 percent in 2020 in the wake of Covid-based travel restrictions and the closure of EU borders. “This has resulted in a €5.4 billion revenue shortfall in Europe’s ANSPs, who failed to react to the drop in traffic by reducing their expenditures accordingly,” said the joint statement. “No other regulation, airport charges scheme, or normal business contracting mechanism foresees airspace users shouldering previous losses from their suppliers, especially not in extraordinary times like the Covid-19 crisis, which is clearly a force majeure event.”
According to A4E, airlines and other industry stakeholders have made far bigger cuts to their operating costs than have air traffic control companies. “While ANSP requirements fell by 60 percent, they opted to reduce their costs by just 1 percent,” said the group's managing director, Thomas Reynaert.
A4E warned that the higher ATC charges faced by airlines and other operators will undermine their contribution to reducing aviation’s carbon footprint by investing in more fuel-efficient aircraft and other measures. “States have chosen to protect their monopoly ANSPs and themselves from paying for revenue gaps from a crisis that has resulted in €22 billion in losses for European carriers,” Reynaert added.
The aviation groups argue that EU member states should have used their governments’ Covid recovery plans, as well as other funds or regulatory mechanisms, to cover all or part of the shortfall in ANSP revenues.