CNN anchor Richard Quest explores the issues facing European aviation when the UK leaves the EU
According to Michael O’Leary, CEO of Ryanair, Europe’s largest carrier, disaster is imminent.
In July O’Leary was apocalyptic in threatening that there would be no flights between the UK and the EU if a deal was not in place by the time of departure.
Others, like IAG’s Willie Walsh, owners of BA and Iberia, sound more relaxed (for the moment) believing a comprehensive aviation agreement will be put in place in time. For him, now is not the time to panic.
It’s all possible. It’s all doable. And it’s all time consuming and expensive to put in place
For the airlines involved, it’s messy and time consuming but pretty straightforward.
UK airlines like EasyJet will need to register their EU fleet in an EU country – hence Dame Carolyn McCall’s decision to get an AOC in Austria, while keeping the UK fleet under the UK regulator.
Ryanair has the opposite problem: its UK fleet will not be able to fly under the Irish AOC, so they will need to register with the CAA (or pull out!).
All the other EU carriers, LH, KLM, even IAG’s Iberia, Aer Lingus & Vueling, will only be able to fly to the UK if a new bi-lateral agreement is put in place. The same for British Airways which will also lose its US rights until a bi-lateral agreement is agreed with the US (a Bermuda Three, perhaps?).
The bottom line: It’s all possible. It’s all doable. And it’s all time consuming and expensive to put in place.
Working out who potentially gains commercial advantage and who loses out is a mug’s game
Willie Walsh is right when he says it shouldn’t be that difficult. Because both sides are starting from the same common standard, it should be easy to put in place an UK/EU air agreement, and a US/UK Open Skies agreement.
Working out who potentially gains commercial advantage and who loses out is a mug’s game. Yes, LH/AF/KLM etc. will all be potential winners if BA has trouble across the Atlantic.
But on the other side of the same coin, they will lose out if long haul feeder traffic over their main hubs is jeopardized because no 6th freedom rights exist. Nor should politicians be eager to “make an example” by playing hardball.
Let’s see them explain to travelers and voters why they cannot get decent flights for their business trips to London or their holidays in Britain. There is one area where O’Leary at Ryanair is right: time is not on the industry’s side.
Passengers and airlines need to know the true reality: sooner rather than later
The airlines plan their schedules a year ahead. And tickets for March 2019 will start to go on sale as early as six months from now. Yes, schedules can be changed and flights canceled (as Michael has shown us).
But it will create chaos if the entire European airline industry has to re-write their summer 2019 flying program.
From my perspective, the best hope in the short term are the “transitional arrangements” that are being discussed – including possibly two years of status quo.
That will give the politicians time to sort out what should be done with aviation.
This should not be taken as an excuse for more brinkmanship and delay.
Unlike other areas of the economy affected by Brexit, with aviation there will come a day when real live passengers, will turn up to get on real planes, and sit in real seats, to travel to real destinations.
In short passengers and airlines need to know the true reality: sooner rather than later.