The 80/20 Use It or Lose It LHR Slot Rules

Old Jun 28, 20, 3:22 pm
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The 80/20 Use It or Lose It LHR Slot Rules

I understand that’s been paused for the current summer, I imagine the winter will be similar, BUT who makes the decision? Is it the EU even though we’re quite likely to be on WTO terms by 1 Jan?
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Old Jun 28, 20, 4:00 pm
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Long term I would be surprised if the UK government doesn’t stick to something close to the 80/20 rule even if they have the ability to change it. It’s long been government policy to encourage greater competition and to maximise the use of the runways capacity. You can’t do that without a usage rule. The only tweak I wonder if you might see at either a UK or EU level is something to stop/discourage slot sitter flights because of the environmental impact.
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Old Jun 28, 20, 4:30 pm
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Whilst BA will be sweating about their slots, another interesting debate and twist is the 3rd runway or expansion London airports have needed. What does Covid have on these plans?

The supposed infrastructure delivery taskforce could press on with LHR but if Willie is correct in his predictions for air travel to resume to 2019 levels by 2023/4 then there will be a slight stronger case against expansion for those that have opposed expansion.

The news on here in the last few days certainly puts into perspective the devastation CV19 is having, if true. The US in itself is incredibly alarming. Dr Fauci is very right when he has we all have a responsibility in this and we part of the process.
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Old Jun 28, 20, 5:13 pm
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rockflyertalk As nobody in their right mind see's the expansion being completed pre '26 at ( unlikely) best I'm not sure it's such an issue.
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Old Jun 28, 20, 5:25 pm
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I guess it will depend on the situation in the long haul market. At the moment there’s no real sign of a boost in demand for US, South Africa, Brazil, India etc. If they’re classed as ‘Red’ by the Government then it won’t be feasible to operate all the slots at LHR, given how much traffic originates from these countries.

If the rules do apply by October, BA/IAG are in a good position. They can fill their long haul slots with short haul slot sitters to Edinburgh/Geneva/Paris etc and even bring up some LGW routes. Virgin wouldn’t realistically be able to cover all of its slots if nobody is flying to the US, there best bet would be to lease them to someone like Eastern Airways or Czech Airlines.

I doubt a decision will be made until August/September though when we have a clearer picture. Even then the winter could bring other spikes, so who knows.
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Old Jun 28, 20, 5:34 pm
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Originally Posted by TWCLAM View Post
rockflyertalk As nobody in their right mind see's the expansion being completed pre '26 at ( unlikely) best I'm not sure it's such an issue.
Ah yes! How many decades from initial discussions will that be?! I count myself relatively young, I pray we go to Mars and beyond, at least in my lifetime before we see a 3rd runway or another London airport.
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Old Jun 28, 20, 6:16 pm
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It's a reasonable assumption Mr Musk will have landed on Mars before runway #3 becomes operational and tbh probably at a fraction of the cost
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Old Jun 28, 20, 6:39 pm
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Originally Posted by BAeuro View Post
I guess it will depend on the situation in the long haul market. At the moment there’s no real sign of a boost in demand for US, South Africa, Brazil, India etc. If they’re classed as ‘Red’ by the Government then it won’t be feasible to operate all the slots at LHR, given how much traffic originates from these countries.

If the rules do apply by October, BA/IAG are in a good position. They can fill their long haul slots with short haul slot sitters to Edinburgh/Geneva/Paris etc and even bring up some LGW routes. Virgin wouldn’t realistically be able to cover all of its slots if nobody is flying to the US, there best bet would be to lease them to someone like Eastern Airways or Czech Airlines.

I doubt a decision will be made until August/September though when we have a clearer picture. Even then the winter could bring other spikes, so who knows.
Devil's advocate - is there anything stopping Virgin operating (inefficient) European flights to preserve slots?
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Old Jun 28, 20, 7:03 pm
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Originally Posted by rockflyertalk View Post
Whilst BA will be sweating about their slots, another interesting debate and twist is the 3rd runway or expansion London airports have needed. What does Covid have on these plans?
If there's no 3rd runway hopefully the government will introduce Air Passenger Duty onto connecting passengers, to discourage Heathrow's use as a hub (unless unavoidable) and to free-up seats for point-to-point passengers.
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Old Jun 28, 20, 7:18 pm
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Originally Posted by ENTP View Post
Devil's advocate - is there anything stopping Virgin operating (inefficient) European flights to preserve slots?
I guess they could...but they would have to get slots at other airports and market the services/get advertising up. I also don’t know if running A330s around Europe when demand is down anyway would just make Virgin lose more money. They could try and get some cargo services though.
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Old Jun 29, 20, 2:33 am
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Originally Posted by cauchy View Post
If there's no 3rd runway hopefully the government will introduce Air Passenger Duty onto connecting passengers, to discourage Heathrow's use as a hub (unless unavoidable) and to free-up seats for point-to-point passengers.
Interesting idea. Then Gatwick, Manchester or even a new Thames estuary airport becomes the new hub airport like NRT/CDG, mainly catering for US bound flights and European connections...
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Old Jun 29, 20, 3:47 am
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Originally Posted by SKRan View Post
Interesting idea. Then Gatwick, Manchester or even a new Thames estuary airport becomes the new hub airport like NRT/CDG, mainly catering for US bound flights and European connections...
Mad. We recently had a Govt Review which explained clearly how a hub works. If you want a direct flight to CHS on point to point, you need some feed in addtion to your p2p. LHR had London’s very strong p2p as well as legacy connectivity which makes it a decent hub and supports a load of frequencies that would otherwise not be viable even with London’s very strong market. Splitting that, as was tried by BA over LHR/LGW was a complete failure. And a hub at MAN just doesn’t pass muster. APD is just another tax to raise money, it’s got almost nothing to do with managing demand, it’s just more desperately needed revenue without actually raising income tax.
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Old Jun 29, 20, 4:12 am
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Originally Posted by skipness1E View Post
Mad. We recently had a Govt Review which explained clearly how a hub works. If you want a direct flight to CHS on point to point, you need some feed in addtion to your p2p. LHR had London’s very strong p2p as well as legacy connectivity which makes it a decent hub and supports a load of frequencies that would otherwise not be viable even with London’s very strong market. Splitting that, as was tried by BA over LHR/LGW was a complete failure. And a hub at MAN just doesn’t pass muster. APD is just another tax to raise money, it’s got almost nothing to do with managing demand, it’s just more desperately needed revenue without actually raising income tax.
Oh, I'm not arguing for a de-hubbing of Heathrow. It's more that, in some senses, not charging APD is effectively a subsidy towards BA's connecting passenger business. There's a subtle balancing act between freeing up seats and slots for use on "thick routes" to promote competition (e.g. letting JetBlue in to compete on NYC, BOS, etc) and facilitating "thin routes" (e.g. CHS) by removing the APD. It depends what you want to prioritise in a small way - Norwegian driving down prices on NYC or nonstop access to obscure American cities.

Of course, if the APD has no effect on this HMRC may as well take the money!
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Old Jun 29, 20, 6:00 am
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Originally Posted by skipness1E View Post
I understand that’s been paused for the current summer, I imagine the winter will be similar, BUT who makes the decision? Is it the EU even though we’re quite likely to be on WTO terms by 1 Jan?
The EU withdrawal bill brought all EU directives onto the UK statute books. It's up to the UK to make a physical change to the EU regs from that point. For example, if the UK wants to agree a deal with the US, we will most likely have to lower our food welfare standards to allow the sale of chlorinated chicken, hormone fed beef and chocolate and other products with insects in them. It's a positive knowing action they must take to change standards.

It will be the same for this requirement. The only thing I've lost track on was whether changes had to go through parliament or if the executive were going to sign changes without debate and scrutiny.
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Old Jun 29, 20, 7:47 am
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Originally Posted by cauchy View Post
If there's no 3rd runway hopefully the government will introduce Air Passenger Duty onto connecting passengers, to discourage Heathrow's use as a hub (unless unavoidable) and to free-up seats for point-to-point passengers.
The difficulty with that is, like any hub, the connecting passengers sustain a lot of Heathrow's value to the UK by being able to offer such an extensive range of destinations, making it attractive to international businesses etc. For example, the BA flights to New Orleans, Cape Town, etc would not be viable without connecting passengers making up a proportion of the load. Start losing those to Amsterdam etc and businesses using these and having their European base here will be liable to move away.

Talk to the Canadians in Montreal about what a good idea Mirabel international airport was, because the city only thought about people travelling to Montreal, not about the substantial connecting business they used to have, which was not only lost but is generally felt to have accelerated the decline of Montreal, once Canada's pre-eminent commercial city, to be supplanted by Toronto.

Regarding the Heathrow slots, they are ultimately under the control of whatever organisation the UK government places them with. This is why it just seems so unwise for Walsh/Cruz to antagonise the UK government, as has been happening. It only needs the government to say "Use it/Lose it prevails", and Easyjet/Ryanair will be in those slots at Heathrow in a flash, to BA's long term disadvantage.
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