European Airlines Seek EU Financial Assistance

Don’t weaken our competitive position, the Association of European Airlines tells EU policy-makers. The events of September 11th have taken the global airline industry into uncharted territory, and according to AEA estimates its member airlines will, in the remainder of the year, suffer losses arising from the tragedy of 2.5 billion Euro. More than 100 aircraft will be grounded. At least 20,000 jobs may be lost, and many more if any airlines are forced into bankruptcy.

In the USA, the government there responded rapidly with a package of assistance to airlines of huge proportions. This has maintained the aviation infrastructure in the USA and ensured the terrorists were not successful in destroying a major industry.

European aviation faces similar challenges and similar risks, and Europe needs to consider similar responses.

The U.S. aid package includes some $15 billion – $10bn in loan guarantees and $5bn in cash. Half of the cash has already been distributed to a large group of airlines, in sums ranging from $819 for a small Florida commuter carrier to $390 million for United Airlines.

The Association of European Airlines told the EU that a vital sector of the European economy was under threat, through circumstances beyond its control. The question asked of the commission was what instruments are there whereby support and relief can be given to the industry, while protecting the evident benefits that the deregulated Single Market has brought to Europe?

A typical example, said the delegation, would be the expected increase in costs related to additional security measures triggered off by the attack – costs which, the AEA believed, should be borne by the states.