2. Contents
Gunther Sollinger Finding the adequate strategy for Northern airlines
Senior Vice President of airBaltic Max Nilov
Freelancer, Aviation Consulting Services
Welcome speech
Nils Ušakovs Challenges of Survival & Prospects for the Future
Chairman of the Riga City Council Guenter Seibt
General Representative of Air Berlin
Anrijs Matīss
State Secretary of Ministry of Transport of Republic of Latvia Engine of Growth in the Baltics
Bertolt Flick
Global Market Forecast 2009 – 2028 President and CEO of airBaltic, Engine of Growth in the Baltics
Andrew Gordon
Forecast Market Analysis, AIRBUS ¸ ¸.)
HAVAS (Havaalanları Yer Hizmetleri A.S
Müjdat Yücel
Extending EU`s aviation frontiers General Manager of HAVAS
¸
Mark Nicklas
Air Transport Agreements & Internal Market of EU Commission BBI-Adapting to customer needs
Marjan Schoeke
Lithuanian Aviation Sector Head of Airline Marketing of Berlin Airports
Agnė Katkutė
Civil Aviation Department of Ministry of Transport of Republic of Supporting customers’ success
Lithuania Jānis Baļķens
CEO of North Hub Services
Engine and Environmental Challenges
Stephane Auter International Airport Riga
Director of International Aero Engines AG, Engine and Environmental Krišjānis Peters
Challenges Chairman of the Board of International Airport Riga
Challenges facing aviation in the CIS airBaltic in social media
Boris Rybak Tero Taskila
General Director of Infomost CCO of airBaltic
3. International aviation conference 2010
Günther Sollinger is a Senior Vice President in Air Baltic,
responsible for external affairs. For several years he
worked for a major European airline, both in central
head office and line functions, covering areas as diverse
as network, sales and marketing, project management,
station handling and partnership & alliances. He was Area
Director responsible for Central- East Europe, as well as
country manager for Russia based in Moscow. During the
mid-1990 he was directly involved in the start-up of Air
Baltic. In 2002 he returned to the airline as Commercial
Director, advancing to his present position in 2006.
Günther graduated from Uppsala University in Sweden,
complementing his education with studies in the USA
and in Great Britain. He was a lecturer in government
at Stockholm University and the University of Uppsala.
Günther has published a number of studies relating to
the early history of aviation in both Sweden and in Russia.
He is a member of the Historical Society for Science
Günther Sollinger
Moderator and Technology, Russian Academy of Sciences, and a
Corresponding Member of the Academy of Sciences,
Aviation and Aeronautics, in Moscow.
4. Keynote speech International aviation conference 2010
Date of birth: March 2004 – November 2005
08.06.1976 Editor of the News Service of the First Baltic Channel,
prepared news releases of Lithuania, Latvia and Estonia;
Education: from January 2005 — Editor of the evening news for
In 1999 acquired Bachelor’s Degree in Economics at the Lithuania and Estonia.
Faculty of Economics and Management of the University
of Latvia. Specialization – analytical economics (the In 2004 received the Ciceron Award established by the
studies took place within the frames of the Eirofakultāte Latvian Union of Journalists and the University of Latvia
(Euro faculty) program). In 2002 acquired the Cand. for the input in journalism. Member of the Board of the
oecon degree (M.Sc. in Anglo-Saxon system) at the public organisation «Baltic Forum»
Economics Department of the Social Sciences Faculty
of the Southern Denmark University. Specialization – In summer 2005 entered into the National Harmony
European Integration Issues. Party. In November 2005 he was unanimously elected to
the post of the Chairman of the Political Union «Harmony
Work Experience: Centre». On 27th November Nils Ušakovs was repeatedly
1998 – 1999 elected to the post of the Chairman of the Board of the
Producer, Baltic Division of the Russian TV channel NTV Political Union «Harmony Centre» for two years. He is a
naturalised citizen of Latvia.
Nils Ušakovs 1999 – 2000
Chairman of Riga City Council Correspondent of LTV News, Latvian Public Television
In October 2006 elected to the 9th Saeima (Parliament of
Latvia).
April 2000 – September 2001
Editor, News and Politics Department, newspaper
On 1st July 2009 elected to the post of the Chairman of
«Respubļika»; after that till July 2002 — Editor, News and
Riga City Council.
Politics Department newspaper «Teļegraf»
Languages:
2001 – 2004 Russian — native,
Host and Editor of the weekly program «Nedēļas tēma» Latvian and English — fluent,
(Theme of the week), television channel TV5. Co-producer, German and Danish — basic,
Editor and Host of the pre-election show «Krievu Swedish — learning.
jautājums» (Russian Question), television channel TV5.
«Krievu jautājums» was the first extensive pre-election Hobbies:
debate in the Russian language in the history of Latvia. sports — running and cycling.
5. International aviation conference 2010
Date of Birth March 2004 - March 2006
September 13, 1973, Riga (Latvia) Non-profit organization The Norway – Latvia Business
Development Fund Ltd., Holder of the state capital share
EDUCATIoN
representative
1994 -1996
Riga Technical University, Master of Engineering scince october 2003 – December 2004
Special economics region of Rezekne, Councilor
1991 -1994
Riga Technical University, Bachelor of Engineering scince 1999 -2003
Ministry of Economics of Republic of Latvia, Director of Quality
1991
structural policy and intern market department
Riga State Grammar school No.1, secondary education
1999 -2002
4. PERIPHERAL TRAINING CoURSES
Non – profit organization Latvian National metrology centre
1993
Standardizations course, Deutsches Institut für Normung Ltd., Authorized Person of Government
DIN 1997 - 1999
1995 Ministry of Economics of Republic of Latvia, Deputy director of
Quality management, audit course, Det Norske Veritas Quality structural policy and intern market department
DNV 1994 -1997
1999 Ministry of Economics of Republic of Latvia, Head of Quality
Quality management and internal audit courses, Deutsches structural policy and intern market unit
Anrijs Matīss Gesellschaft für Qualitat (DGQ) 1993 -1994
State Secretary of Ministry of 5. WorK exPerience Ministry of Economics of Republic of Latvia, Chief specialist at
Transport of Republic of Latvia December 2009 – at present Standardization and Certification department
Ministry of Transport of Republic of Latvia, State Secretary 1989 (2 months); 1999 (2 months)
January 2008 – December 2009 The Institute of Polymer Mechanics of Latvian Academy of
Ministry of Economics of Republic of Latvia, State Sciences, technician
Secretary
6. PERIPHERAL INFoRMATIoN
June 2003– January 2008 2008 – December 14, 2009
Ministry of Economics of Republic of Latvia, Vice secretary JSC Rīgas Siltums, JSC Latvijas gāze, Holder of the state
of state responsible for industrial, business and internal capital shares
market questions
2008 - April, 2009
August 2006 – January 2008 Latvijas Standarts Ltd., Latvian National metrology centre Ltd.,
Latvian National metrology centre Ltd., Member of the Agency of Latvian Guarantee Ltd., Holder of the state capital
Board share
March 2006 - April 2006 2009
Investment and Development Agency of Latvia, Acting Award from Minister of Economics for the contribution in the
Director development of the Ministry
6. Anrijs Matiss / Presentation International aviation conference 2010
We realized from the very beginning that in such country as Latvia,
Excellencies, colleagues, Ladies and Gentlemen! which is located relatively far from the centre of Europe, with no
It is an honour and pleasure for me to welcome you in Riga on the railway link to European railway system, to provide connectivity to
second North HubRiga conference to discuss issues which are the customers and to ensure economic needs, a rapid development
important for the future of the air transport. of aviation was the necessary precondition. It included building up
and reconstruction of a new infrastructure and establishing and
It is a great opportunity to share views and experience with the then supporting an effective air carrier.
key persons and real experts in the air transport field, and I hope
it would benefit to all of us and would also allow us to find answers Since 2004, when Latvia became a member of EU and got access
to questions which emerge every day with no answers in the to common free air transport market, we have been seeing
textbooks. continuous growth of traffic carried by our national airline Airbaltic,
and also uninterrupted growth of passenger numbers for Riga
The recent natural disaster in Iceland resulted in air traffic chaos airport from mere 700 thousand in 2004, to more than 4 million
in Europe and showed explicitly that there is no substitute for air in 2009. Even now, in the period of deep crises in the national
transportation in the modern society. economy, a stable performance of Airbaltic and effective use of
transit opportunities allows to keep traffic growing.
7. Anrijs Matiss / Presentation International aviation conference 2010
From the ministry’s point of view it is utmost important to facilitate Results
development setting and introducing the right air policy principles.
More than 90 direct destinations to/from Riga.
That includes helping to set the right strategy goals for the
national carrier, ensuring that the infrastructure, and first of all, the More than 4 million passengers in 2009.
airport capacity meets the growing traffic demand, the necessary
regulations are introduced timely, airport and air navigation Uninterrupted growth of the Riga airport and the Airbaltic traffic up
tariffs are just and do not put the excessive burden on carriers, to this day including period of crisis.
and bilateral air services agreements with the third countries
concerned are concluded. Effective east – west and north - south link .
8. Anrijs Matiss / Presentation International aviation conference 2010
CHALLENGES
Economic uncertainty in Europe, recession in the
national economy
Action Lack of airport capacity
Action
Airline attracts more transit traffic including from the non EU
countries to compensate shrinking of the domestic market. Building of a new terminal; Government decides to support Riga
Ministry facilitates the intergovernmental bilateral negotiations on International Airport and Airbaltic’s common decision to participate
air services agreements to support such policy. in a new terminal project.
(Recently agreements concluded: with Armenia, Tajikistan,
Uzbekistan, Kirgizstan, Turkmenistan, Jordan, Lebanon Bahrain;
ongoing negotiations with Iran etc.)
9. Anrijs Matiss / Presentation International aviation conference 2010
Environmental issues; emission trading
The emission trading scheme which is accepted at EU level and
supposes to mitigate pollution created by air transport does not
create equal conditions for large EU carriers, established long
time ago, and the new rapidly growing carriers from the new EU
member states. This is particularly important in countries where
there is no alternative mode for the air transport.
There should be a global decision on limitation of aviation
emissions.
Regulatory environment supporting development
Effective participation in the decision taking in the air transport
field in the EU.
10. Global trends in the aviation industry International aviation conference 2010
Andrew Gordon became Director Market Analysis
at Airbus in 2001. In this role he is responsible for
facilitating the production of the Airbus Global Market
Forecast, which details future demand for all civil aircraft
of 50 seats or more. Andy is also accountable for analysis
and forecasting of products as diverse as business jets,
regional aircraft and military derivatives.
Prior to this appointment Andrew worked for a ten-
year period for British Aerospace Airbus as part of the
Forecasting & Market Evaluation Team, where he was
involved in providing analysis for many of the market and
product related decisions including the A380 project.
In 2001, at the creation of Airbus as a single entity,
Andrew moved to Toulouse, to work directly for Airbus in
the Market Forecasting & Research Group, now part of
the Strategy and Co-operation team.
Andrew Gordon
Forecast Director of AirBus
Andrew Gordon began his career with BAE/Airbus in 1991
and prior to this he worked for one of the UK’s largest
banks.
Andrew has a Masters Degree in Marketing from the
University of the West England. He is married and lives
near Toulouse. In his free time he enjoys rambling, golf
and is also playing cricket for Toulouse Cricket Club, where
he is the Club Secretary.
11. Andrew Gordon / Presentation International aviation conference 2010
Premium ticket volume and revenue growth
Premium Premium
revenues volumes
Premium revenues
(left scale)
June 9th 2010, North Hub Riga,
International Aviation Conference
Andrew Gordon
Director Market Analysis
Premium volumes
(right scale)
Source: extract from IATA
12. Andrew Gordon / Presentation International aviation conference 2010
Agenda The aviation cycle, several cycles impacting in series
The last Cycle (s)
The recovery
Global Market Outlook
The Baltic Market Outlook
Source: Global Insight, ICAO & IATA
13. Andrew Gordon / Presentation International aviation conference 2010
Recovery tracking Recovery and the volcano…
WORLD ECONOMY WORLD TRADE
World real GDP year-over-year quarterly evolution (%) World trade year-over-year quarterly evolution (%)
History Forecast History Forecast
We are We are
here
h here
h
2007 2008 2009 2010 2007 2008 2009 2010
May
WORLD PASSENGER TRAFFIC passenger WORLD FREIGHT TRAFFIC
World ASKs year-over-year monthly evolution (%) traffic up World FTKs year-over-year monthly evolution (%)
5.6%
April
freight
traffic
t ffi up
24%
2007 2008 2009 2010 2007 2008 2009 2010
Source: Global Insight, OAG, IATA, ATA, AEA, Airbus
14. Andrew Gordon / Presentation International aviation conference 2010
Passenger traffic above pre-crisis level
Could we live without flying?
since Oct-2009
ASKs (billion)
Ash cloud grounds U.S. produce,
fish and parts
Source: OAG, Airbus
15. Andrew Gordon / Presentation International aviation conference 2010
Recovery tracking Traffic recovery anticipated for 2010
US AIRLINES WESTERN EUROPEAN AIRLINES
ASKs year-over-year monthly evolution (%) ASKs year-over-year monthly evolution (%)
May May
passenger
traffic down
p
passengerg
traffic up
World air traffic growth (%RPKs)
1.7% 1.3%
Best case
2007 2008 2009 2010 2007 2008 2009 2010
EMERGING ECONOMIES* AIRLINES REST OF WORLD AIRLINES
ASKs year-over-year monthly evolution (%) ASKs year-over-year monthly evolution (%)
May
May passenger
passenger traffic up
traffic up 1.2% Worst case
15.3%
15 3%
2007 2008 2009 2010 2011
Estimate (Forecast) (Forecast)
2007 2008 2009 2010 2007 2008 2009 2010
Source: OAG, * 54 emerging economies, Airbus Source: ICAO, Airbus Market Research and Forecasts
16. Andrew Gordon / Presentation International aviation conference 2010
Air travel has proved to be resilient to external shocks… Air travel remains a growth market
20-year
World annual traffic (RPKs - world annual
ld l
World annual traffic (RPKs - trillions)
trillions) traffic growth
+38%* 4.7%
+36%
+36%* ICAO Airbus
total traffic GMF 2009
2009
* since 2000
E
Source: ICAO, Airbus Source: ICAO, Airbus
17. Andrew Gordon / Presentation International aviation conference 2010
Agenda The Airbus Global Market Forecast (GMF) 2009
The recovery 20 year aircraft demand f
i ft d d forecast, aircraft >19 seats
t i ft 19 t
Traffic forecast modeling 156 distinct traffic flows
Global Market Outlook Detailed study of network evolution including new routes,
markets and deregulation hot spots
Model the impact of evolving airline models
e.g. Low cost carriers
The Baltic Market Outlook Fleet build-ups covering >750 passenger airlines,
190 freight carriers
Available as a book, interactive pdf and on the web.
, p
18. Andrew Gordon / Presentation International aviation conference 2010
Taking into account key industry drivers Large potential to increase propensity to travel
Economics Demographics Networks 10 Seychelles Bahamas
• Growth • Population growth • Global cities Cyprus
• Emerging markets Barbados Malta Macao UAE Ireland
New Zealand
• Hubs
Maldives
• Age profiles Singapore
• Cycles
St Lucia Bahrain Spain Hong Kong Australia
• Disposable income • New routes j
Fiji Trinidad Puerto Rico
Greece
Kuwait
Canada
UK
Qatar USA
Sweden Denmark Switzerland
Mauritius
• Urbanisation • Deregulation
France
1
Trips* per capit - 2008
Finland
Cape Verde Malaysia Latvia Saudi Arabia Portugal Brunei Italy Germany Belgium
South Korea Japan Netherlands
Panama Taiwan
Samoa
Suriname Croatia Estonia Israel
Jordan Mexico Czech Rep.
2 trips
Hungary per
Turkey Slovenia
Slovakia capita
ta
BrazilRussia
Poland
Equatorial Guinea
China
0,1 Algeria
Botswana
Bosnia
India
Belarus World average
Angola 0.11 trip
Nigeria
per
Bangladesh
Lesotho
capita
Afghanistan
0.05 trip
0,01 per
Passengers Airlines Aircraft
Iraq
Chad capita
Niger
• Ticket price • Fuel • Seats Speed, utilisation
Seats, Speed
• Comfort • Range • Frequency, load factor
• Origin and destination • Fleet mix • Range 0,001
0 5 000 10 000 15 000 20 000 25 000 30 000 35 000 40 000 45 000 50 000 55 000
• Connectivity • Business models • Replacement
• Environment • Legislation/taxation • Fleet mix Passengers originating from a particular country
2008 Real GDP per Capita
• Environment • Environment Note: GDP in 2005 US$
Source: IATA PaxIS, Global Insight, Airbus
19. Andrew Gordon / Presentation International aviation conference 2010
Large potential to increase propensity to travel Air transport is still emerging for 85% of the world
10
China
Seychelles Bahamas
India
Barbados Malta Cyprus Macao UAE Ireland
Maldives New Zealand
Singapore
5.7
Australia
Middle East
St Lucia Bahrain Spain Hong Kong
Canada Qatar
UK Switzerland
j
Fiji Trinidad Greece Sweden Denmark
Puerto Rico Kuwait
Asia* billion
Mauritius France
1
Trips* per capit - 2008
Finland
Cape Verde Malaysia Latvia Saudi Arabia Portugal Brunei Italy Germany Belgium
South Korea Japan Netherlands
Panama Taiwan
Samoa
Africa people
Suriname Croatia Estonia Israel
Jordan Mexico Czech Rep.
CIS
Hungary
2008
Turkey Slovenia
Slovakia
ta
BrazilRussia
Poland
0,1
China
Algeria
Equatorial Guinea
Botswana Latvia Latin America
India
Bosnia
Belarus World average
Eastern Europe
Angola
Nigeria
Bangladesh
Lesotho
Afghanistan
0,01
Iraq
Chad
Niger
Western Europe 1
billion
0,001 North America people
0 5 000 10 000 15 000 20 000 25 000 30 000 35 000 40 000 45 000 50 000 55 000
Japan
p 2008
Passengers originating from a particular country
2008 Real GDP per Capita
Note: GDP in 2005 US$
Source: IATA PaxIS, Global Insight, Airbus * Asia excludes India, China and Japan
20. Andrew Gordon / Presentation International aviation conference 2010
Low Cost Airlines have continued to grow More larger aircraft will be needed as LCC routes grow
Worldwide LCCs market share (% seats offered) Number of airline routes
41%
of the LCC
capacity
LCC Routes* > 500 daily seats.
21% of
seats now 19%
offered by of the LCC
LCCs capacity
2006 2007 2008 2009
History Estimates
*Airport pairs operated by a specific airline
Source: OAG, Airbus Source: Airbus, OAG. Number of LCC routes* > 500 daily seats.
21. Andrew Gordon / Presentation International aviation conference 2010
Great potential for growth for LCCs in Asia Pacific Aircraft size increased in all regions over the last 35 years
Intra Asia Pacific LCC market share (% seats offered) Average aircraft capacity (number of seats) per flight
Aircraft
+41%
41% getting
+34% bigger
+31%
12% of seats +28%
now offered
by LCCs in +21%
Asia/Pacific
A i /P ifi +16%
2006 2007 2008 2009
Aircraft >90 seats only
Source: OAG, Airbus Source: OAG, January 2009
22. Andrew Gordon / Presentation International aviation conference 2010
Single Aisles getting bigger Emerging markets driving World urbanisation
2%
Population (billions)
13%
Urban Population
48% Today
T d
46%
5%
Rural Population
29%
45% Source: UN,Airbus
12%
Source: Ascend January 2008 Western Pax only
23. Andrew Gordon / Presentation International aviation conference 2010
A network of cities : 92% of the long haul
The number of mega-cities will more than double
traffic is from and/or to 37 “mega-cities”
37 “mega cities” in terms of
mega-cities 82 bi cities where long-haul passengers
big iti h l h l
international air traffic demand will want to fly between in 20 years
More
Mega-cities
Mega cities
A
A B
A
Destinations with more than 10 000 daily long haul pax Destinations with more than 10 000 daily long haul pax
24. Andrew Gordon / Presentation International aviation conference 2010
Growth in the size and number of mega-cities The A380 network keeps growing
30 A380s delighting passengers around the world
Main long haul VLA routes by 2028
long-haul
London
Manchester
Frankfurt
Toronto Paris
Zurich Beijing
Tokyo
New York Seoul Los Angeles
A
Dubai
A B
Jeddah Hong Kong
A Bangkok
Singapore Airlines
g p
Emirates Singapore
Qantas
Air France
Lufthansa
Sydney
Additional airline-announced Johannesburg
J h b
routes for 2010 shown dotted Auckland
Melbourne
Over 138,000 revenue flight hours in over 15,000 revenue flights
(as f J
( of June 3rd, 2010)
d
Destinations with more than 10 000 daily long haul pax More than 5.4 million passengers have already enjoyed the A380 experience
25. Andrew Gordon / Presentation International aviation conference 2010
The main drivers of tomorrow’s traffic growth Airbus Global Market Forecast highlights
World fleet forecast 2008 2028 Change
Growing Middle East passenger and cargo hubs
RPKs (trillion) 4.58
4 58 11.58
11 58 +153%
In Asia, more people able and wanting to fly everyday
Passenger aircraft 14,016 28,111 +100%
LCCs in Asia growing in number and traffic share
New passenger aircraft deliveries - 24,097 -
More potential through deregulation, particularly in
Asia and Africa Dedicated freighters 1,731 3,865 +123%
Growing urbanisation and a resulting increased
New freighters deliveries - 854 -
demand between major cities
Total new deliveries - 24,951 -
Passenger aircraft >= 100 seats
26. Andrew Gordon / Presentation International aviation conference 2010
Asia to lead in world traffic by 2028 New aircraft demand will average 1,248 per year
20-year world
annual traffic
growth Number of new aircraft
4.7%
RPKs (billions)
% of 2008 Traffic by airline domicile % of 2028
20-year
World World
growth
RPKs RPKs
26% 2008 traffic 2009-2028 growth 6% 33%
28% 4.3% 26%
31% 2.4% 20%
5% 6.9% 8%
4% 5.8% 6%
3% 5.9% 4%
3% 5.2% 3% % units: 68% 17% 8% 7%
% value: 39% 27% 15% 19%
Passenger and freighter aircraft
27. Andrew Gordon / Presentation International aviation conference 2010
Agenda Baltic region’s traffic more than quadrupled since 2000
ASK development, 2009 vs. 2000
The Recovery
North America
Global Market Outlook
Intra
No nonstop regional CIS
traffic in 2000 +257%
+446%
The Baltic Market Outlook Western
Central
C t l
Europe
Europe +643%
+322%
Intra
I t regional traffic
i l t ffi +257% Middle East and
International traffic +361% North Africa
Overall traffic +358% +544%
Source: OAG (September traffic), Airbus
28. Andrew Gordon / Presentation International aviation conference 2010
Expanding international network from Baltic countries Traffic to Central and Western Europe dominating
Traffic (million ASK)
North America
Baltic region
2000 Africa and Middle East
Central and West Europe
CIS
45
International 2009
nonstop routes*
routes
121 International
nonstop routes*
* International routes: Routes from airports in Estonia, Latvia and Lithuania to airports outside these countries
Source: OAG (September traffic), Airbus Source: OAG (September traffic), Airbus
29. Andrew Gordon / Presentation International aviation conference 2010
No coincidence airBaltic has grown its presence too
Traffic (million ASK) Traffic share (on ASK)
1,000 50%
800 40%
North America
Baltic region
Africa and Middle East
Central and West Europe
CIS
600 30%
400 20%
200 10%
0 0%
1995 1997 1999 2001 2003 2005 2007 2009
Source: OAG (September traffic), Airbus
30. Extending EU`s aviation frontiers International aviation conference 2010
Mark Nicklas joined the European Commission’s Air
Transport Directorate in 2003. He has been a key
member of the EU team in the EU-US air transport
negotiations. As policy officer in the European
Commission’s unit for air transport agreements and
internal market, he has been involved in EU air transport
negotiations with various third countries (e.g. US,
Australia, New Zealand, Latin America, Mediterranean).
In addition, he has dealt with the implementation of the
internal aviation market in the EU. Since June 2010, he
is assisting the European Commission’s Director for
Air Transport in the coordination of the EU air transport
policy.
Prior to joining the European Commission, he worked as a
manager in the telecommunications industry in Germany
(Deutsche Telekom; T-Mobile International).
Mark Nicklas
Air Transport Agreements & Internal Market He studied economics and business administration at
of EU Commission Hohenheim University (Germany). He holds a Ph.D. in
economics.
31. Mark Nicklas / Presentation International aviation conference 2010
Extra-EU traffic flows
Extra-EU passenger traffic is 35% of total EU traffic
Extending EU’s Aviation
Frontiers
Mark Nicklas
Internal Market, Air Transport Agreements & Multilateral Relations
European Commission
North Hub Riga Aviation Conference
Riga, 9 June 2010 1 2
32. Mark Nicklas / Presentation International aviation conference 2010
From 27 National Air Transport Markets
International Air Services Agreements to 1 Single European Market
Air traffic between two states is traditionally
governed by restrictive bilateral air services
agreements (ASAs)
Before 1992: national markets within the
EU were protected and fragmented through
Restrictions on: restrictive bilateral air service agreements
How many and which carriers may fly? between EU Member States
How many weekly flights (frequencies)? After 1992: One Single market without
To which cities / airports?
Pricing restrictions on market access and pricing
“Open Skies” agreements - opened market
2004/2007: Enlargement to 27 Member
States
access, but based on national ownership
Common EU rules in all areas of aviation
EU aviation policy – aiming at market opening, The world’s largest and most successful
ownership normalisation and regulatory
convergence example of regional market integration and
3
liberalisation in air transport. 4
33. Mark Nicklas / Presentation International aviation conference 2010
Unprecedented Challenges Key Objective:
Ensuring Sustainability of the Sector’s Growth
1. Global economic downturn Means:
2. Volatile fuel prices 1. Continue to lead towards highest safety and
security standards – a pre-condition for growth
3. Increasing environmental pressure 2. Ensure environmental sustainability
Comprehensive approach
4. Security measures
1. Tackling the capacity crunch
5. Increasing costs from congestion – on land and Avoid/reduce bottlenecks on the ground and in the air
in the air 1. Competitiveness of the industry
Cost reductions, efficiency and consolidation
6. Most recently: volcanic ash in Europe No bail-out – but accelerating structural reform
Removal of out-dated ownership and control restrictions
1. Extend benefits of market opening
5 6
34. Mark Nicklas / Presentation International aviation conference 2010
Going Beyond Europe: The Three Guiding Principles in EU External
Pillars of the External Dimension Aviation Relations
I. Bringing existing bilateral agreements into Relations must be based on agreements that
line with Community law respect Community law. If not:
II. The creation of a “Common Aviation Area” Agreements vulnerable to legal challenge
with neighbouring countries Uncertainty for commercial operators
Parallel process of market opening and Level playing field allowing all airlines to compete
adoption of EU legislation on a fair and equal basis
I. Conclusion of ambitious global agreements Regulatory convergence
with key partners (US, Canada, Australia, No «one fits-all» approach: Agreements depend on
New Zealand, India, China, Russia, Brazil…). relations to third country
7 8
35. Mark Nicklas / Presentation International aviation conference 2010
Pillar I: “Community Designation” Progress on the EC designation
Requirement of the EU internal market
104 non-EU states have accepted Community
Objective: designation
To allow EU carriers to benefit from the
right of establishment within the EU, Nearly 900 Bilateral ASAs (around half) have
including non-discriminatory access to air been brought into conformity with Community
routes to third countries.
law (representing 70% of extra-EU traffic)
New clause:
Any EU Member State can designate any 41 “Horizontal” Agreements covering nearly
licensed EU carrier with an establishment 700 ASAs
in its territory
No changes in traffic rights granted in
bilateral agreements
9 10
36. Mark Nicklas / Presentation International aviation conference 2010
Pillar II: A Wider Common Aviation Area Common Aviation Area with Neighbouring
Countries by 2010 – progress
Southern and Eastern neighbouring countries
Pre-accession context: Western Balkans (ECAA)
ECAA Agreement signed in June 2006
New candidate: Moldova
Morocco (Euro-Mediterranean agreement)
EU-Morocco Agreement signed in December 2006
Negotiations concluded with Georgia and Jordan in 2010
Ongoing negotiations with Ukraine, Israel, Lebanon Negotiation mandates for Tunisia, Algeria
Open to other countries, including from Central Asia
Ambition: “Towards a single market of more than 50 states and 1 billion inhabitants”
58 States – Approx. 1 Billion inhabitants 11 12