Setting the scene
After Rikke Christensen explained how the slots flexibility allowed Virgin to be agile and pivot to cargo during the pandemic, Richard Quest asked both panelists “Does the slot regime need to be changed?” Christensen said “no”, Pierre-Hugues Schmit said “yes”. In his view, reform would improve capacity and competition. His concern was some airlines at some airports “sitting” on slots and not utilizing the 20% capacity of the 80-20 rule. He also argued that the existing rules were a barrier to entry to new carriers and thus restricting competition.
Christensen pointed out that it is very difficult to coordinate slots at both ends of the route. It was also important to note that it was only in the UK that slots can be ‘bought’, and that the system does enable slots to be handed back. She explained that the complexities were considerable, for example, the US is terminal constrained, whereas Europe is mainly runway-constrained. Schmit was challenged on his vision for slots to be subjected to a charging mechanism, rising for peak times. Christensen suggested that pricing would not allow new entrants.
Quest asked if the pandemic had “opened Pandora’s box” on change in the slot system, and whether the panelists expected change. Schmidt said that while it was important to harmonize rules on major transnational routes like US-Europe, it should be possible for regional experimentation. Christensen was adamant that we need one consistent regulation so airlines can plan at both ends of the route. Schmidt was sure there would be significant revision of the rules, whereas Christensen felt there should only be “modifications”.