Financial relief and evidence-based policies needed for restart and recovery

7 months ago 375

Home News Press Releases Financial relief and evidence-based policies needed for restart and recovery

Government assistance will help safeguard essential operations and millions of jobs

Montreal, 16 June 2020 – Airports Council International (ACI) World has today called for urgent government assistance and relief for airports to underpin operational restart and sustain the long-term industry recovery.

The COVID-19 pandemic’s effect on the industry and broader economy has halted the airport industry at global level. ACI World estimates has resulted in a reduction of more than 4.6 billion passengers with a decline in total airport revenues on a global scale of more than $97 billion (figures in US Dollars) for 2020.

Despite this, they remain important engines of economic growth, wealth creation and employment. They employ – either directly or indirectly – more than 6.1 million globally which makes up 60% of all employment in the aviation sector and provide direct societal and economic benefits to the local, regional, and national communities they serve.

As airports in some regions embark on the first steps in restarting operations and make plans for a sustained, long term recovery, ACI World said today that this recovery needs to be underpinned by financial assistance and relief to safeguard essential operations and protect millions of jobs. ACI World is urging the adoption of the following policy responses to help the industry as it recovers:

Protection of aeronautical revenues:  Because of the sharp downturn in revenues, operators need to protect revenues such as airport charges. In a context where commercial revenues from retail, food and beverage and car parking have experienced a significant downturn, aeronautical revenues remain the sole source of funding for airports to continue to ensure the basic services required by airport passengers and users. To avoid impacts on the airport cost base, expenses related to new health related measures brought on by the COVID-19 pandemic should be covered by governments. Tax relief and concession fee waiver: urgent tax relief will provide much-needed financial oxygen to airports to ensure continuity of operations and safeguard airport jobs. Additionally, airport rents and concession fees should be waived or postponed in the form of a one-time measure for a defined period. An evidence-based and data-driven approach to slots: regulators worldwide should consider the needs of travelers and of the overall aviation ecosystem before deciding to extend airport slots waivers into the winter 2020-2021 season. Noting that several airlines have already made public announcements regarding fleet reductions, ACI World has become concerned that waivers could be used as a mechanism to isolate slots from market realities during the recovery period. In situations where waivers would be extended, strict conditions should be attached to incentivize airlines to return slots they will not use to ensure that consumers are protected from last-minute cancellations, avoid unintended impacts on the competitive landscape, and enable airports to plan operations safely and cost-effectively. Continued support for air cargo operations: airports should continue levying charges on air cargo operations to maintain essential airside and cargo facilities as passenger operations continue to be slow. Comprehensive financial relief: this should include wage subsidy schemes to help restart operations and underpin recovery. Grants and subsidies, secured financing, loans at preferential rates, and bank guarantees should be made available. Financial relief should benefit all actors in the aviation ecosystem.

“Airports need urgent relief and assistance to help them as they begin to restart operations, weather the far-reaching economic ramifications of the crisis, and help lay the foundation of a balanced recovery,” ACI World Director General Angela Gittens said.

“With the massive revenue shortfall, airports continue to face high fixed costs and rising costs related to health measures at airports coupled with creeping increases in the cost of capital are new challenges brought on by the pandemic. ACI World believes these costs need to be considered by governments and the impact they have on the airport cost base.

“Airports are keen to support traffic growth but the allocation of airport capacity also requires a balanced approach for all aviation stakeholders. Waivers on slots, or a suspension on the use-it-or lose rule, could potentially limit choice for travellers and weaken competition among airlines as part of industry recovery efforts.

“ACI World urges regulators to follow a data-driven and evidence-based approach to assess whether further blanket slot waivers are the appropriate measure in re-establishing local, regional and global connectivity.”

Notes for editors

The Policy Brief: COVID-19: Relief Measures to Ensure the Survival of the Airport Industry is available free of charge on the ACI World website. ACI World has released a detailed breakdown of the predicted economic impact of the COVID-19 pandemic on the global airport industry. Stay up to date with ACI World’s COVID-19 communications through its dedicated news hub. Airports Council International (ACI), the trade association of the world’s airports, was founded in 1991 with the objective of fostering cooperation among its member airports and other partners in world aviation, including the International Civil Aviation Organization, the International Air Transport Association and the Civil Air Navigation Services Organization. In representing the best interests of airports during key phases of policy development, ACI makes a significant contribution toward ensuring a global air transport system that is safe, secure, customer-centric and environmentally sustainable. As of January 2020, ACI serves 668 members, operating 1979 airports in 176 countries.

Media contacts

Bojana Jeremic
Manager, External Relations and Special Events
ACI World
Telephone: +1 514 373 1254
Email: mediarelations@aci.aero

Read Entire Article