ACI Europe

A Vision for European Aviation

On the 18th January, 2006, ACI Europe and Eurocontrol held a combined press conference on the future of European aviation. Here Mr Roy Griffins, Director General of ACI Europe, outlines the key areas the conference focused on.

The Capacity Crisis

ACI Europe and Eurocontrol (the organisation for air navigation) share a common understanding of the mounting crisis the aviation industry is facing – over the next 5-10 years – due to the rapid growth in air traffic and insufficient capacity. European air traffic is expected to double by 2020 to 2 billion passengers. Unfortunately, current levels of existing airport infrastructure are inadequate to meet this anticipated demand. This will lead to Europe’s airports becoming the main bottleneck in the air transport chain and regardless of how far European airport operators squeeze the most out of existing capacity the reality is that new runways and terminals are the only way to accommodate future demand.

It would be irresponsible and wasteful not to make the best use of existing capacity. Europe’s airports are working with industry partners like Eurocontrol to see that existing airport capacity is used in the safest, most efficient and sustainable manner possible. Their successes include: Airport Airside Capacity Enhancement (ACE); improved runway safety: and SESAR – the Single European Sky Implementation Programme – to name a few.

However, regardless of how far airport operators squeeze the most out of existing capacity the reality is that new runways and terminals are the only way to accommodate future demand. Europe’s airports must be able to build the terminals and runways to accommodate anticipated demand; otherwise airtravellers will soon face widespread delays and severe congestion at Europe’s main airports. Already many of Europe’s airports find themselves under pressure.

Eurocontrol's core activities span the entire range of gate-to-gate air navigation service operations - from strategic and tactical flow management to controller training; from regional control of airspace to development of leading-edge, safety-proofed technologies and procedures, and the collection of air navigation charges.

As early as 2010, forecasts Eurocontrol, over twenty major European airports will have a capacity shortage if passenger demand continues to grow as anticipated.

Facing the Challenge Together

Europe’s projected capacity shortfall presents significant environmental and financing challenges for airport operators. They must be able to provide the necessary investment and facilities to cope with sustainable growth and meet the expectations of their customers. Yet, building new airports or expanding current facilities has become an increasingly difficult,lengthy and sometimes impossible task, including:

• Planning permission / environmental challenge
• Financing

If Europe’s aviation industry is to tackle the capacity crisis then Europe’s airports, air navigation service providers, airlines and manufacturers must work together (and regulators and legislators must play their part too).

Permission to Grow and the Environmental Challenge

The challenge for the aviation industry is to create the requisite political will to tackle the capacity crisis .Together we need to help European, national and local policy makers understand the contribution that aviation makes to people’s lives and economic growth/development. Critically, the aviation industry needs to take on the environmental challenge, as sustainable development is key to future growth .Infrastructure development will not be allowed unless it meets the environmental challenge/test. Brave decisions need to be made by both industry and policymakers. The alternative is congestion, poor service,less competition and a failure to meet people’s need sand expectations. No one wants this as a legacy.

Paying for the Future

Travelers and airlines alike rightly expect delivery of a(high) quality service. To ensure this, airport operators need to make long-term decisions for the future .Airport planning cycles range from between 10, 20 or even 30 years. Airlines – given the more variable nature of their business – have much shorter perspectives. To meet the projected growth in air traffic and the needs of their customer’s European airports are providing massive levels of investment in infrastructure and facilities. In fact, European airports are expected to spend in excess of US$10 billion annually over the next decade.* This is particularly true at Europe’s main airports. For example, BAA will have invested more than £8 billion – in its London airports(Heathrow, Gatwick, and Stansted) – over the eleven-year period 2003-2014. The centrepiece of this investment programme, Heathrow Terminal 5, remains on schedule and on budget with a total cost of approximately £4.2 billion at 2004 prices.

Aéroports de Paris has already invested €2.4 billion between 2000 and 2004, and plans to invest a further€2.5 billion over the next five years.

Failing to invest for the future now would be damaging for the long-term well being of the entire aviation industry.

As with any Product, Such Investment has to be Paid For

Airport investment is largely funded by airport charges,which are regulated – in one form or another –throughout Europe, and tend to be low.

Airline claims of excessive airport charging are not supported by the facts. The reality is that airport charges, used to fund infrastructure investments,are a relatively small proportion of airline costs .Airport charges have remained stable at about 4 percent of airline operating costs on average over the last 30 years.

In view of the shared requirements of both airports and airlines for adequate infrastructure and facilities we must work together to reach a rationale balance.

ACI Europe Charges Study

Following the publication last year of our ‘Building for the future study’ ACI Europe is commissioning an in-depth and far-reaching examination of the financing of major airport investment. This study will assess the capital requirements for Europe’s airports over the next10 years, and how these requirements can be funded.We hope this can form the basis for joined-up industry thinking on building for the future.

The long-term success of aviation in Europe is predicated on our ability to address the capacity crisis we face. To do this effectively we must work in partnership. Exchanging criticisms rather than seeking sensible common ground serves only to lessen our effectiveness. We need instead to focus on those challenges, which threaten to undermine the future of our industry – capacity and environmental concerns.We must strive to convince decision makers of the social and economic importance of aviation for the success of the EU economy; while maintaining our focus on providing a safe, secure, sustainable, high quality service to Europe’s air travelers.

Biography

Roy Griffins is Director General of ACI EUROPE. Mr Griffins has served as the UK Director General of Civil Aviation from 1999 to 2004. He has also served in both the UK Permanent Representation in Brussels and in the British Embassy in Washington DC, where his portfolio included UK/US air services, aerospace trade and shipping policy. Mr Griffins was made a Companion of the Order of the Bath (CB) in the UK's2003 Queen's Birthday Honours list