The rise in air traffic demand has thrown airport capacity into the spotlight, which has become a major issue for passengers and cargo alike as both experience problems arising from slow growth of infrastructure.
There is no direct substitute for the physical expansion of airports to resolve this crisis. But there is a need to manage scarce capacity with a fair, neutral, and transparent system until sufficient capacity can be built. For that, IATA’s Worldwide Slot Guidelines is critical.
Despite minimal airport development of note, the WSG’s ability to manage scarce capacity has enabled growth in all parts of the world. There were more than 2,000 additional routes at European slot-coordinated airports between 2010 and 2017, for example, allowing an extra 155 million passengers to travel.
Importantly, new entrants—including low-cost carriers (LCC)—have thrived under the WSG. According to Eurocontrol, LCC flights grew 61% between 2007 and 2016. The top airports for LCCs in Europe in terms of movements are Barcelona, Dusseldorf, London Gatwick, and Stansted—all level 3 airports (the most congested).
There is a need to manage scarce capacity with a fair, neutral, and transparent system until sufficient capacity can be built. For that, IATA’s Worldwide Slot Guidelines is critical
“In the past five years, HKExpress has opened a dozen new routes out of Hong Kong’s essentially full airport that had no competition or only one incumbent carrier, with the effect of making all of these destinations available to far more travelers through lower fares and increased competition,” says Stephen Milstrey, Manager, Network Planning and Scheduling, HKExpress.
“The historic determination guidelines in the WSG enabled this by allowing us to slowly convert generally unusable, short series of slots into valuable, full-season slots.”
The WSG, despite the huge pressure on congested airports, has enabled airlines to increase passenger choice and competition and driven forward aviation’s economic benefits. It has allowed the industry to grow and provide consumers the destinations and connectivity they demand.
Nevertheless, there have been calls for a radical shake-up of the system and some regulators have experimented with potential alternatives.
The WSG, despite the huge pressure on congested airports, has enabled airlines to increase passenger choice and competition and driven forward aviation’s economic benefits
In large part, this has been brought on by the increasing severity of the capacity crunch. In a worst-case scenario, there could be more than 300 slot-coordinated airports in 10 years’ time. Major hubs such as London Heathrow, Amsterdam Schiphol, and Hong Kong are already full to the brim. The slot pool is empty.
Regulators are thus concerned about how to develop the process to allow for new entrants to compete. Coupled with this is a desire to improve the monitoring of slots, so that incumbents do not abuse the WSG process.
There are several concerns with some of the views being put forward, however. Primarily, if the system descended into individual airports pursuing their own agendas, the resulting patchwork of processes would certainly confuse and constrict the network. A take-off slot at airport A only has value if there is a corresponding landing slot available at the other congested airport B at the right time.
“As a global industry, aviation needs a global solution,” says Lara Maughan, IATA’s Head of Worldwide Airport Slots.
Major hubs such as London Heathrow, Amsterdam Schiphol, and Hong Kong are already full to the brim. The slot pool is empty
Also, airport calls to have greater control over how their facilities are used neglects a crucial fact: only an airline should decide where and when to fly and what aircraft to use.
Congested airports rarely share the risk associated with starting new routes, given their strong demand, whereas airlines are making decisions related to fleet investment, new markets, and in many cases opening routes to destinations that will take more than one or two seasons to establish.
Moreover, even when there is nothing left in the slot pool, the WSG still has value in optimizing schedules. Airlines still manage to grow despite the congestion, moving slots to take account of new fleet, new demand, and slot availability at the other end.
Slot mobility—swapping or transferring slots to other airlines in a secondary process—allows airlines to best use slots to meet consumer demand with speed and agility. The majority of secondary slot exchanges take place for no monetary compensation as they allow the carriers involved in the exchanges to optimize their operation.
Even at the so-called super-congested airports, airlines can eventually get access through the WSG; Aeromexico, Air Astana, Hainan Airlines, Philippine Airlines, and Vietnam Airlines have all started operating at Heathrow in the last few years.
And once they have entered the market, carriers can grow, as demonstrated by HKExpress at Hong Kong International Airport. It has grown from a fleet of five aircraft to more than 20 in a short period (2013–2018).
We cannot solve the capacity crisis with the WSG, only ensure all available capacity is allocated fairly. Making sure the WSG is as good as it can be is why we’re focusing on the strategic review
Though research and analysis has shown that the WSG is the best solution available, Maughan accepts that there is a need to improve and clarify the process. With this in mind, IATA launched a strategic review of the WSG in July 2016.
To ensure the views of all stakeholders are taken into account, the review is being undertaken in conjunction with Airports Council International (ACI) and the Worldwide Airport Coordinators Group (WWACG).
“We cannot solve the capacity crisis with the WSG, only ensure all available capacity is allocated fairly,” says Maughan. “Making sure the WSG is as good as it can be is why we’re focusing on the strategic review.”
The scope, timelines, project details, and management have been established and agreed by the three parties. Initial conclusions and recommendations will be presented to the Strategic Review Management Group by November 2018, with the Review completed in 2019. Some early ideas might even make it into the January 2019 edition of the WSG. And regulators will be kept in the loop at all times.
The review is composed of four task forces (Slot performance monitoring, Access, Historic Determination, Level 2 Airports). Clarification on performance monitoring, a greater focus on transparency and independence, and the possibility of a revamped new entrant rule are likely to be areas of especial interest. The timelines and process details involved in slot allocation will also be examined in light of today’s dynamic market and new technologies.
“As the global coordinators association, with many years of experience managing the slot process at the world’s busiest airports, our members have an excellent overview of the different challenges and issues from different parts of the globe,” says Eric Herbane, COHOR (French Airport Coordination) and WWACG Chair.
IATA is fully committed to the WSG and its ability to support the growth of the aviation industry and certainly not reluctant to ensure the review delivers meaningful outcomes
“We contribute this expertise and experience in defining the best possible processes for the future WSG and therefore fully support the strategic review.”
Herbane stresses that independent coordination is a key principle of the WSG, to ensure the neutral, fair, and transparent approach is maintained, and while there are areas of the WSG that need review and enhancement, “broadly the policy and process work.”
“The WSG is essential,” Maughan reiterates. “If governments and airports resorted to local and unique solutions, it would cripple airlines’ efforts to provide their customers with the services their want, to the places they want to fly, when they want to fly, and at a price they want to pay.
“IATA is fully committed to the WSG and its ability to support the growth of the aviation industry and certainly not reluctant to ensure the review delivers meaningful outcomes.”