EU rules that are decisive for the activity of regional airports seem headed for revision in the coming months. The European Commission is looking to reconsider its guidelines for the public financing of airports and state aid for airlines based at regional airports. The stakes are crucial for the regions and regional airports, since the guidelines set rules for the financing of airports by public authorities - particularly at regional level - and determine the conditions in which airlines may seek aid for the start-up of new routes based at regional airports.

The Commission has to draw up a report on the way the rules operate by the end of the year, paving the way for possible changes. For the regions concerned, now is the time to make their voices heard. The EU executive is exploring, for instance, the idea of adapting the criteria on which it judges the legality of public aid for new routes.

This is already a sensitive subject, particularly now as the economic crisis deals a hard blow to regional airports and causes a chain reaction on employment and the economic development of their home regions. Studies show that airports are economic development tools that have major repercussions on employment, commercial activity and tourism in the area. It is estimated that 1,000 jobs are created for every million passengers using an airport ⁽¹⁾. Since mid-2008, however, figures on the use of regional airports have declined and in July 2009, more than 70% saw a decrease in passenger numbers, some by even more than 30%, compared with 2008 averages.

Admittedly, not all are affected in the same way. The airport at Charleroi (Belgium), for example, which strongly promotes its low-cost image, finds that the crisis has worked to its advantage, with figures rising by more than 40% over the last three months compared with the same period last year. The fact remains, though, that regional airports are particularly vulnerable. The main reason is that, in contrast to large airports, they often depend on one or just a few carriers, airlines that are prepared to change their base of operations more easily than those operating at major hubs. Regional airports in particular suffer from this situation (fewer passengers means lower income from aviation and commercial activities) as do their regions.

ADAPTING START-UP AID

As the crisis wears on, the biggest challenge for regional airports is to maintain a certain level of traffic. To put it plainly, they have to avoid closing routes and if possible open new ones. The incentives that regions and airports offer to airlines are often crucial in this respect. In the case of regional airports, the Commission’s temporary easing of rules for granting state aid to companies in difficulty as a result of the crisis is not particularly useful precisely because it only concerns companies in financial difficulty. Many airlines based at regional airports, even those in good financial health, do not think twice about shutting down routes that fail to show the expected return - even if because of the crisis - if such routes are not supported by public aid.

What regional airports need most now is continuity in the public aid schemes put in place to support the launch of new routes. Yet the guidelines limit such aid to three years at most. When they were adopted, in 2005, the Commission argued that the new routes had to be profitable within three years and be capable of operating without public aid after that period.

With the advent of the crisis, things are not quite so simple and the airports fear for the future of certain routes in which they - and the regions - have invested aid and which have not reached the breakeven point due to lower use for over a year now. For these airports, it is of paramount importance to be able to continue to support such routes, failing which they may simply disappear. Closing routes would directly affect the airports concerned and their host regions. ACI-Europe, the professional association of airport operators, is therefore pressing for the extension to five years - rather than three - of public aid for the start-up of new routes. “It is of the utmost importance,” says the association, “to support the economy of the regions concerned during this crisis by allowing them to maintain existing routes and develop new ones.”

What regional airports need most is continuity in the public aid schemes put in place to support the launch of new routes 
⁽¹⁾ York Aviation, The social and economic impact of airports in Europe, 2004