European Commission (EC) reportedly plans to compel airports to allow at least three ground handling providers to operate services at airports, up from the current two, according to a Financial Times Deutschland report. The EC is also reportedly planning to compel airlines to sell off their ground handling units to create more competition. The regulation proposal will reportedly be published in late Nov-2011. In a separate proposal, the EC also reportedly plans to toughen the rules on when airlines lose their take-off and landing slots. As part of the plan, airlines would lose a slot if they use it less than 85% of the time, compared with 80% currently.
European Commission to make changes to ground handling provision; slot usage: reports
You may also be interested in the following articles...
"Too little competition in the American (airline) market". EU head: US consolidation goes too far
At the ACI 26th General Assembly in Athens on 21-Jun-2016 the European Commission's DG Competition Henrik Mørch said that the EC has generally approved JVs but is closely watching consolidation trends. As reported in a CAPA news brief, Mr Mørch said that the EC is interested in how much consolidation can be justified with efficiency gains for the consumer.
He added that, while the European aviation market is more fragmented than the American market, taking the level of consolidation that exists in the US and applying it to Europe is "not necessarily something we would advocate for...there's too little competition in the American market in our view".
However, the level of concentration on the North Atlantic, the principal market where JVs have been approved by the Commission, is greater than in North America – the market that Mr Mørch considers too concentrated. Meanwhile, European fragmentation weighs heavily on its airlines' yields and holds back their profitability.
Europe's aviation strike spike could signal a cyclical peak - with downturn to follow
One swallow does not make a spring and nor does a rash of aviation strike news guarantee a turning point for the aviation industry. But the signs are ominous. In the month of Jun-2016 (to 20-Jun-2016), there have been 136 articles on CAPA's website mentioning the word 'strike'. This compares with 81 for the first 20 days of Jun-2015. For 2016 so far (1-Jan-2016 to 20-Jun-2016), the 's' word has occurred in 594 articles – about 20% more than in the same period in each of the past two years. If this rate continues, 2016 could be the biggest year for strike-related articles since before the global financial crisis.
The vast majority of the Jun-2016 articles – 80% – relate to Europe. A significant source is air traffic control disputes, particularly French ATC. There have also been strikes and/or strike threats involving airport workers and ground handlers. Among European airlines, Air France has generated the most coverage for its ongoing dispute with its pilots, and it may also face a cabin crew strike. Lufthansa has not yet faced a strike by its employees this year, but has not yet reached new agreements with pilots or cabin crew after industrial action last year.
History tells us that labour's demands grow as profits rise. The apparent increase in industrial action this year could be a signal of an approaching peak in the airline profit cycle. There are other causes of unrest, such as impending French labour legislation, but the correlation reflects some history.