Study raises concerns about Europe’s recovery path
By VICTORIA MOORES
The rapid recovery of the European aviation industry might be reaching a plateau, according to Olivier Jankovec, the director general of ACI Europe, who shared his concerns with Routes Europe delegates on May 9.
Jankovec explained that traffic for the first three months of 2023 was just 11% down overall on pre-pandemic levels, but ACI is beginning to see some stagnation.
“We're not progressing further in getting closer to recovery, so I wonder whether we actually may be reaching a kind of recovery ceiling,” he said.
Jankovec said that the market was “kind of stuck” around the minus 11%-12% level, which is different from the month-on-month improvements seen in late 2022.
The patchy recovery is making the situation even more obscure. European countries that had the most stringent travel restrictions are now seeing exponential growth, while others are lagging. “Performance gaps remain across national markets; they've actually widened quite significantly,” he said.
Surprisingly, Russian airports are now “pretty close” to where they were 2019, despite sanctions triggered by the Ukraine conflict. While this is based on partial data, Jankovec said it was indicative of a redistribution of Russian traffic flows away from Europe and North America, in favor of the “huge” Russian domestic market, as well as booming links with Uzbekistan, Kazakhstan and Central Asia.
Jankovec also believes that broader demand shifts in the European market may be here to stay, such as the rise of leisure travel and people combining personal and business trips. “What we are seeing clearly is a new aviation paradigm,” he said.
Another shifting paradigm, according to Jankovec, is airline-airport power dynamics. On May 9, the opening day of Routes Europe, ACI Europe published a report on how the structural market changes resulting from the pandemic have increased the power of airlines over airports. Jankovec claimed that the reality of airport competition remains “largely ignored” by national regulators across Europe, while airlines “enjoy unrestrained pricing power.”
IATA regional VP for Europe Rafael Schvartzman, who was the next speaker on stage, said he had listened carefully to Jankovec’s comments. He said the majority of the time, airlines and airports have a very strong partnership.
“Obviously, we have our differences,” he said. “I think the structural challenges that we have are much bigger, in my view.” Schvartzman gave the example of the “irrational” proposal for capacity cuts at Amsterdam Schiphol.
“None of us here have ever lived in an economy that doesn't depend on oil,” Schvartzman said.
Looking at that higher level, Schvartzman is concerned that high-level sustainability mandates, such as the EU’s Fit for 55 eco-legislation, are not triggering enough action at country level.
“Most countries in Europe are waiting for the big countries to produce [SAF],” he said. “No European country will be in a condition to produce enough to export anything, because this is transformation to a level we've never seen before. So, it is important that every country takes action.”
Returning to the ACI perspective, Jankovec sees potential for European airports to become “enerports,” acting as sustainable fuels providers for their countries, as well as their airline customers.
