Airlines at UK airports will be free to cancel flights over the summer of 2021 without losing their slots.
Airport Coordination Ltd, the body responsible for allocating slots at UK airports, has confirmed that the 80/20 “use it lose it” rule on airport slots will be waived at UK airports for the summer 2021 season.
This waiver has been in place since the start of the summer 2020 season. There had been complaints from some airlines that this waiver was benefiting incumbent airlines and inhibiting competition.
easyJet and JetBlue have both been unsuccessful in applying for slots at London Heathrow for the summer 2021 season.
easyJet and JetBlue had applied for 98 and 42 weekly slots respectively from the pool at Heathrow and none were awarded.
They were far from alone. Each season a large number of airlines apply to Airport Coordination Ltd for slots from a pool of available slots. Almost all get nothing. Slots from the pool are very hard to come by as they only become available when forfeited or handed back by an airline, which most go to great lengths to avoid.
Other airlines that were unsuccessful in applying for slots include Air Baltic, Alitalia Cityliner, Blue Air, Brussels Airlines, Eastern Airways, Loganair, WestJet and Widereo. Unsurprisingly, Norwegian did not apply for any slots at London Heathrow this summer. Only Shenzhen Airlines managed to secure a mere 4 weekly slots.
That does not mean that any of these airlines won’t serve Heathrow this summer. Blue Air will fly from London Heathrow to Bucharest from 1 December 2020 and Cluj-Napoca from 1 March 2021.
Airport Coordination Ltd, the body responsible for governing the allocation of slots at London airports, has granted an extension of the waiver of “use it or lose it” rules until the end of the winter season.
However, reform of the slot waiver process is proposed by the European Commission to address concerns that it restricts competition.
Ordinarily airlines are required to use their airport slots for 80% of a season to avoid forfeiting them. Following a ruling by the European Commission airlines are currently benefiting from a waiver of this rule. This means they can cancel as many flights as they like without risk of losing their slots.
There had been doubts as to whether the waiver would be extended into the winter season. Indeed, only three weeks ago, ACL advised airlines that they should plan for the waiver not to be extended into the winter.
European Commissioner for Transport Adina Valeăn has today, Monday 14 September, issued a statement announcing the Commission’s intention to extend the slot waiver.
The Commission has published a report for the European Parliament and Council identifying shortcomings with the current process, namely that incumbent airlines are not handing slots back to slot coordinators in sufficient time for others to use on a temporary basis.
Adina Valeăn has made it clear in her statement that as full slot waiver has been granted for the whole winter season, incumbent airlines are expected to follow the spirit of the waiver and hand back slots sufficiently early for other airlines to use them.
Currently, airlines operating from London airports benefit from a relaxation of “use it or lose it” rules which govern their ownership of slots.
Ordinarily airlines must use their slots at London airports for 80% of the time in the winter or summer season to retain their slots. This is to prevent airlines from hoarding slots to keep out competitors.
Earlier this year, Airport Coordination Ltd agreed to relax this rule for the summer 2020 season following a ruling from the European Commission.
By all accounts, air travel is not expect to meaningfully recover until well into 2021. Airlines face a tough winter. With the winter season now less than two months away, there are no indications that ACL is preparing to relax its “use it or lose it” rule for London airports over the winter season.
ACL has today, Wednesday 26 August 2020, issued guidance to airlines in the expectation that “use it or lose it” rules will return for London airports from Sunday 25 October 2020.
For airlines, this presents a challenge. If they do not use their slots, particularly at London Heathrow, these will be forfeited and ultimately acquired by competitors for free.
At the same time, the overwhelming priority for airlines is the preservation of cash. Many airlines are actively ensuring that every single flight they operate is on a cash flow positive basis. Airlines could operate “ghost flights” to preserve their slots. This will cost money and leave them exposed to criticism for its impact on the environment.
This rule could still change, but it will still give airlines very little notice.
Qatar Airways and Japan Airlines are to temporarily relocate to London Heathrow Terminal 5.
Both airlines had temporarily relocated to Terminal 2 due to the closure of Terminals 3 and 4.
They will now move to Terminal 5 from Monday 27 and Wednesday 29 July 2020 respectively where they will join fellow Oneworld alliance members American Airlines, BA and Iberia.
Note that at the time of publication, this is not reflected in all online timetables.
It may seem odd these airlines are moving terminals twice due to COVID-19, this is most likely due to systems issues at Terminal 5 which were originally designed for BA.
Although not confirmed, timetables indicate that Finnair will relocate to Terminal 5 from Saturday 15 August.
In terms of other Oneworld alliance members, Cathay Pacific, LATAM, Malaysia Airlines, Qantas, Royal Jordanian, Royal Air Maroc and SriLankan Airlines remain at Terminal 2, to the extent they are operating international flights from London Heathrow.
Currently, Heathrow airport does not expect Terminal 3 to reopen until late 2020 at the earliest. This will depend on how demand recovers in the autumn. Terminal 4 is not expected to reopen until 2021 at the earliest.
One option is to buy them from another airline. As Oman Air did in 2016 when it bought a single slot pair from Kenya Airways for $75m. Selling Heathrow slots is something struggling airlines often do to raise cash, not that it ever solves their underlying problems.
Another way is to simply ask for them. A small number of slots are available and slots can be released into a pool on the rare occasion airlines choose to hand them back.
Most get absolutely nothing. And if they do, as all airport slots are not the same, they may not be taken up.
Passengers do not need to do anything differently. They will not be stopped by any members of staff. Whilst Heathrow insists that no personally identifiable data will be gathered, passengers also have the option of taking a different route to avoid the cameras if they wish.
Terminal 3 has closed. Terminal 4 closed to passenger flights on Sunday 3 May.
The last airlines to transfer flights from Terminal 4 to Terminal 2 did so on Sunday 3 May. These are Air France, Air Malta, Alitalia, El Al, Etihad Airways, Kenya Airways, KLM, Kuwait Airways, Korean Air and Malaysia Airlines.
This means that all airlines other than American Airlines, BA and Iberia now operate from Terminal 2.
Rail services to Terminal 4 are suspended from Sunday 8 May.
No date has been given for the reopening of Terminals 3 and 4. Heathrow airport says Terminal 3 may reopen later in 2020 depending on how demand recovers in the autumn. Some airlines such as Virgin Atlantic will be keen to move back to Terminal 3 due to the infrastructure they have in place there.
It’s plausible that this may prompt a reorganisation of airlines at Heathrow. Some airlines may leave Heathrow permanently. Heathrow airport say Terminal 4 will not reopen until 2021 at the earliest. It is not an easy terminal to operate from due to its location, and could be mothballed for some time, if not permanently closed.
Heathrow airport has confirmed that Terminals 3 and 4 will close temporarily in “the coming weeks”.
Airlines operating from these terminals will transfer their flights to Terminals 2 and 5.
This follows a fall in passenger flights of 75%. No date has been given for the change. Nor has it been confirmed which airlines which move into which terminals.
The logical move is for Oneworld alliance member airlines such as American Airlines, Cathay Pacific, Finnair, Japan Airlines and Qantas to move to Terminal 5.
SkyTeam member airlines such as Air France, Delta and KLM and non-aligned airlines such as Virgin Atlantic could move to Terminal 2.
There is a lot of complexity behind the scenes before these moves can be agreed.
For example, Terminal 5 was originally designed around BA’s own systems and processes. When Iberia moved into the terminal many years ago, it took a long time for Iberia flights could operate from the terminal under their own flight numbers.
There are also industrial relations issues with airlines having their own employees and handling agents at Heathrow.
Given the upheaval required behind the scenes to facilitate these moves, this does suggest that flights at Heathrow will be reduced substantially for some time.
The latest guidance on Coronavirus from Heathrow can be viewed here.
Heathrow will also move to a single runway operation from Monday 6 April 2020. Flights will alternative between the Northern and Southern runway each week as per this schedule.
Update Saturday 2 May 2020
The transfer of airline operations is taking place in phases. Here are confirmed transfers to date:
Cathay Pacific, Emirates and Pakistan International Airlines has transferred flights to Terminal 2 from Thursday 16 April 2020.
Japan Airlines has transferred flights to Terminal 2 from Saturday 18 April 2020.
Iran Air has transferred flights to Terminal 2 from Sunday 19 April 2020.
Beijing Capital Airlines, Finnair, Qantas and Qatar Airways have transferred flights to Terminal 2 from Monday 20 April.
American Airlines and Virgin Atlantic have transferred flights to Terminal 2 from Tuesday 21 April.
Philippine Airlines has transferred flights to Terminal 2 from Friday 24 April.
Gulf Air has transferred flights to Terminal 2 from Saturday 25 April.
China Southern Airlines has transferred flights to Terminal 2 from Wednesday 29 April.
Saudia and Middle East Airlines (MEA) have transferred flight to Terminal 2 from Thursday 30 April.
SriLankan Airlines and Bulgaria Air moved to Terminal 2 from Friday 1 May.
KLM, Alitalia, Kenya Airways, Kuwait Airways, Etihad Airways, Korean Air, Air Malta, El Al, and Malaysia Airlines will all relocate from Terminal 4 to Terminal 2 from Sunday 3 May.
Note these changes are being announced at very short notice and may also be subject to further change at short notice.
London Gatwick is to temporarily close its North Terminal from Wednesday 1 April 2020.
All existing airport operations will be consolidated in the South Terminal.
The airport’s single runway will also only be used for scheduled flights between 14:00 and 22:00 each day.
The runway will remain available for emergency landings and diversions outside of these hours.
The North Terminal is currently used by airlines such as easyJet, Emirates, Qatar Airways, Tui and Virgin Atlantic. easyJet is currently operating a skeleton schedule. Virgin Atlantic has temporarily transferred all operations to London Heathrow.
The few flights remain operating by these airlines will transfer to the South Terminal. This is currently used by airlines such as Aer Lingus, British Airways, Ryanair and Vueling.
This arrangement will continue for at least one month. London City airport has also closed until the end of April at the earliest. London Heathrow airport is expected to shortly announce terminal closures.