The 80/20 airport slot rule may be back, and change UK aviation for ever

Airport Coordination, which manages slot allocation at ‘full’ UK airports, issued a guidance note to airlines yesterday. It reiterated that there is NO slot waiver in place for the Winter season, which starts at the end of October, and gave no indication that one would be granted.

You can see the guidance note here.

At congested airports, including Heathrow and Gatwick, airlines are granted the right to keep their existing seasonal slots as long as that slot is flown 80% of the time. If utilisation drops below 80% over the course of the Summer or Winter season, the slot is forfeited. It returns to a central pool, overseen by Airport Coordination, and allocated to another airline which has requested slots.

A slot waiver was put in place in March covering the Summer season. This has allowed airlines to run only a fraction of their services without the risk of slot loss.

The situation for the Winter season, which begins on 25th October, is more complex. Some airlines, in particular Wizz Air, have pushed for the waiver to be ended. There is a belief that the waivers are damaging competition because there are airlines which wish to operate services from airports such as London Heathrow if only slots were available.

The European Commission is believed to have some sympathy for this approach.

For clarity, it is the European Commission – and not Airport Coordination – who will have the final say. These decisions are outside the control of individual countries because – as airlines need slots at both ends of a flight – the allocation process needs to be mirrored at all major airports.

What would happen if the 80/20 rule returned?

You may think that this may be the end of the British Airways domination of Heathrow. My guess is that you would be wrong.

By moving its Gatwick short haul services to London Heathrow, BA has given itself some slack. It would clearly be very difficult for BA to use 80% of its Heathrow slots, but it does at least have the necessary aircraft available.

BA can also call on the broader resources of IAG. We would see Vueling, Iberia and Aer Lingus stepping up their flights out of London Heathrow considerably.

Many of the flights would go out empty, but BA, and the wider IAG group, does at least have the aircraft to fly them.

(BA would lose its London Gatwick slots for the Winter season if it went down this route. With easyJet and Wizz Air likely to grab as many as they can during the reallocation, it could mean the end of British Airways at the airport.)

Foreign carriers have bigger problems

The real panic will come from foreign carriers. With very few foreign airlines currently running flights into Heathrow, how are they to retain their slots?

Carriers like, say, Oman Air would literally have to pay a private jet operator to run an empty aircraft out of Heathrow twice per day, on four days out of five.

The slots could be leased to other airlines, but how many carriers would be interested in running services into Heathrow for just one Winter season?

You can easily see how British Airways could benefit from the 80/20 rule coming back. If key foreign carriers lost their slots to fly into Heathrow during future Winter seasons, it would clearly strengthen BA’s position considerably. How many carriers would want to keep their Summer slots if they had no rights to fly over Winter?

Let’s see what happens. There is still time for the European Commission to announce a waiver, but with only two months to go, time is running out.