Subscribe to our free, weekly email newsletter!



Air cargo concerns surface in the EU

By Patrick Burnson, Executive Editor
October 10, 2011

Amid the many other worries troubling the Eurozone, comes news that states are falling behind in their commitments to improve the region’s notoriously inefficient air traffic management.

The International Air Transport Association (IATA) has alerted its members to the latest independent Performance Review Body (PRB) report and the draft recommendations from the European Commission, which notes that states are falling behind in their legislated commitments to deliver improvements in operational, financial and environmental operations.

“Everybody agrees that high costs, delays, environmental waste and circuitous routings are not acceptable. But the problems are not going to fix themselves. Airlines have invested in aircraft and technology to operate at the highest levels of efficiency—often times ahead of what ANSPs are capable of. And we are ready to help drive efficiencies further. But it is the responsibility of states to ensure that their air navigation service providers are delivering what is needed,” said Tony Tyler, IATA’s Director General and CEO.

Last year, states committed to improve the cost efficiency of air navigation services by 3.5 percent annually for 2012-2104. At the request of individual states this was reduced from the Performance Review Body’s proposed target of a 4.5 percent annual gain in cost efficiency. “Watering down the targets to 3.5 percent is costing the competitiveness of Europe’s connectivity EUR 1 billion a year. Now because of inaction we are facing a further hit of EUR 256 million. When targets are agreed, state leadership must ensure that they are met. This is not the time for complacency,” said Tyler.

The PRB report shows that 21 of 29 European states failed to make adequate contributions to the cost-efficiency target. According to the PRB report, the 10 air navigation service providers (ANSPs) who are contributing least to the cost reduction targets are: Malta, Cyprus, Estonia, Hungary, Slovakia, Germany, Spain (continental), United Kingdom, Czech Republic and Finland.?The total shortfall is 2.4 percent according to the PRB, which will equate to a total cost of EUR 256 million of unrealized savings for 2012-2014.

“The real story is with the ‘Big Five’ ANSPs – Germany, UK, France, Italy and Spain. Being responsible for 54 percent of the costs of air navigation services in Europe, the success of the performance scheme is dependant on these states meeting their share of the required cost reductions with no shortfall,” said Tyler.

The performance improvement targets are an integral part of the Single European Sky Package II (SES II) approved by the European Union’s Transport Council in March 2009. “The SES cost-efficiency objective is a 50 percent reduction in air traffic management costs by 2020. The latest reports indicate that the ANSPs are hardly achieving cost containment, let alone the needed reductions,” said Tyler. Alongside improving cost efficiency, SES aims to increase airspace capacity by over 70 percent, improve the safety record by a factor of 10 and reduce the effects of air transport on the environment by 10 percent.

The PRB’s report further noted that that six performance plans (Austria, Greece, Poland, Spain, United Kingdom, and FABEC—covering Germany, Belgium, France, Luxembourg, the Netherlands and Switzerland,) do not make adequate contributions to meeting the EU-wide capacity target.

“If the European ANSPs cannot meet modest short-term goals, then there is no chance of meeting the significantly more ambitious but necessary targets that are required for the second phase of the Performance Scheme (2015-19). States and ANSPs need to close the gap and return to course,” said Tyler.

About the Author

image
Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

Now that the deal, which had to clear several regulatory hurdles in multiple countries, is official, FedEx executives were able to speak a little bit more freely, albeit being somewhat guarded in regards to certain integration specifics at the same time.

As the July 1st date for complete compliance looms, shippers are seeking help to cope with the mandatory changes instituted by the International Maritime Organization (IMO) to the Safety of Life at Sea Convention (SOLAS).

As of July 1, only containers with a verified gross mass will be cleared to be loaded onto a ship under the International Maritime Organization’s Safety of Life at Sea (SOLAS) Verified Gross Mass (VGM) amendment. Shippers hoping that the implementation of the ruling will be delayed or deferred are whistling in the dark, say industry analysts.

Amid the many worrisome economic indicators kicking around of late, something along the lines of good news came about this week in the form of United States new home sales data, issued by the United States Department of Commerce this week.

In March, the SCI came in at 0.4, which FTR described as “a near neutral reading” on the heels of four months of more favorable market trends for shippers.

Article Topics

Blogs · Air Cargo · Global Logistics · Global · All topics

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2016 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA