Aviation Intelligence Reporter February 2024
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New Commission, New Agenda: ACI’s Proposals for Action
By Olivier Jankovec, DG Airports Council International – Europe
Every 5 years, as the EU goes for parliamentary elections and the designation of a new
European Commission, the bloc’s overall political direction and strategy is reassessed
and renewed. While in the past there was usually a great deal of continuity in the
resulting policies, the 5 years cycle which is now ending (2019-2024) radically changed
the EU’s course. Covid-19 and climate change brought about unprecedented
disruptions to EU policy. The former significantly damaged the Single Market. Freedom
of movement took an unprecedented hit and strict State aid rules were essentially thrown
out of the window – albeit temporarily. The latter reflected the urgent realism of radical
change, with the Green Deal setting out the green (and digital) transformation of our
economy and societies – based on the legally binding dual objective of climate neutrality
by 2050 and a 55% reduction in greenhouse house gas emissions by 2030.
Predictions: Hard to Make, Particularly When About the Future
Every company, every organisation, has to balance the skills of its employees to
optimise its operations. Those skills range from accounting to engineering, to
economics, to analysis, to industrial design. It is not easy, arguable it is impossible, to
get that balance right. That is why every company is forever tinkering with org charts,
with organograms and with reporting lines. Fashion plays a part in this, too. Once,
almost every airline was run by a pilot. Then they were run by lawyers. It is hard to put a
cigarette paper between the particular advantages the personality types of those two
groups, nor what each brings to the table.
Recently, it is the turn of the accountants. Ask Boeing how that is working out. There is
a very strong argument that the shift in focus from engineering first and foremost, to a
laser-like focus on share price has not been without incident at Boeing. Sure, loose
bolts can happen at any time, but if the focus is speed of production, not engineering
excellence, something has got to give. Finally, getting the accountants’ attention was
the fact that what gave was the share price.
Sardinia: Playground of Italy’s Ruling Class
We have written before about the concerns the Italian government has about market
forces applying to airfares between mainland Italy and Sardina. They do not like the
fact that when market forces apply, and demand outstrips supply, the fares go up. The
solution that the Italian populist government arrived at was to put a price cap on airfares,
driving down supply. The cap applied immediately, for the summer just passed, but in a
stroke of legislative brilliance, was subject to review and debate only 60 days thereafter.
The brilliance is obvious if you think of it from their point of view. The fact that Sardina is
very popular with the ruling class of Italy, and the location of many of their preferred
holiday houses is of course simply a coincidence. The cap had the effect of limiting the
number of normal holidaymakers that could get to the island and crowd out the in crowd, whilst simultaneously making their trips not subject to market forces and market
pricing. Still, even they could see that it was so egregious that whilst it bought some
time, there would continue to be a need for this sort of creative legislative genius into the
future. Is there anything more populist than pretending to be acting in the interests of
the people whilst arranging things to your own benefit?
Cargo: Doing the Heavy Lifting
Mainstream aviation conferences rarely feature cargo. That, those in cargo will note, is
bloody typical. They are down-to-earth in cargo. The European Aviation Conference
addressed this imbalance in Luxemburg at the end of last year. The figures speak for
themselves. About 5% of world cargo travels by air, but it is 35% of the value of world
trade. That is measured in the trillions, annually. Less than 10% of the world will travel
on a plane, but many, many more than that will produce, work on, or process, items that
have been or will be air cargo. Flower pickers in Kenya are unlikely to fly to Europe, but
their livelihood depends on the flowers doing so. The economic impact of air cargo is
multiples of that of passenger traffic. Yet, aviation policy focuses on passengers.
In Space, No-One Can Hear Your Industry Maturing
Between 1993 and 2023, the number of operational satellites in space rose from 300 to
more than 9000. By 2030, that number is projected to hit 58,000. Most of the growth is
in the low Earth orbit space. These are satellites that orbit much closer to Earth than
traditional geostationary satellites. This proximity means lower latency, faster broadband
and new applications, aircraft tracking and remote sensing capabilities.
The largest LEO constellation is SpaceX’s Starlink. To date, SpaceX has launched only
one third of its planned 12,000 satellite mega constellation. Nonetheless, Starlink
represents less than half of the operational LEO satellites. Unlike GEO constellations,
which for global coverage require 3-4 satellites with 15-20 year lifespans, after which
they are moved into graveyard orbits, LEO constellations require hundreds to thousands
of satellites designed for a shorter, 3-7 year lifespan. This allows iterations of improved
satellites. These de-orbit via combustion in the Earth’s atmosphere. More and more
rockets go up to replenish the constellations as more and more satellites come down.
Time for the UK to Rejoin EASA
By Dr Barry Humphreys, Aviation consultant
It has been over seven and a half years since the UK voted to leave the European
Union, four years since it formally did so. Brexit is now well behind us. We shouldn’t be
too sanguine, but there is some cause for optimism that a more mature relationship may
be emerging. The head-banging Europhobes in London and the fanatical federalists in
Brussels have gone (relatively) quiet, or at least are less influential, and been replaced
by politicians and officials who seem to realise that a more practical and co-operative
relationship is in everyone’s interests. After all, the UK is clearly not going to rejoin the
EU, not any time soon anyway, so we might as well make the best of what we have. A
likely new Labour Government elected later this year will only help.
One significant sign of this change was the announcement last September that Britain
would become an Associate Member of the Horizon project, a €94 billion science funding
and co-operation scheme widely regarded as a European success story. Pre-Brexit, the
UK had been a major participant in Horizon, building on the back of its established
scientific research base and as a result gaining more funding than it paid into the
scheme. The assumption seems to have been that despite Brexit, the UK would remain
closely involved, as are several other non-EU countries. For its part, the UK
Government continued to negotiate a close working relationship, but was repelled by the
EU (arguably in contravention, incidentally, of the EU/UK Trade and Co-operation
Agreement). It was only with the settlement of the Northern Ireland protocol, the so called Windsor Framework, that final agreement on Horizon was possible.