aviation in the european union – an overviewclacsec.lima.icao.int/.../sesion1/calleja.pdf · 2...

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Aviation in the European Union – an Overview

Daniel CallejaDirector of Air TransportEuropean Commission

EU-Latin America Civil Aviation SummitRio de Janeiro, 24-26 May 2010

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Presentation Outline

The Single EU Aviation Market – A Success of Regional IntegrationEU-Latin America Aviation MarketCommon Aviation Policy ChallengesGoing Beyond Europe: EU External Aviation PolicyConclusion: EU-Latin America Aviation Relations – Enhancing Cooperation

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The EU Today

• 27 Member States• 490 Million Inhabitants • One Single Market

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Before 1992: national markets within the EU were protected and fragmented through restrictive bilateral air service agreements between EU Member States

After 1992: One Single market without restrictions on market access and pricing

Common EU rules in all areas of aviation

The world’s largest and most successful example of regional market integration and liberalisation in air transport.

From 27 National Air Transport Markets to 1 Single European Market

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What Have We Achieved?Successes of the Single Market

…more competition…

Intra-EU routes with more than 2 carriers have increased by 310% between 1992 and 2009

…and…

Number of Intra-EU27 routes with more than 2 carriers

0

50

100

150

200

250

300

350

400

450

500

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Source: OAG summer schedules

Rou

tes

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What Have We Achieved?Successes of the Single Market

…more choice …Number of Cross-border Intra-EU routes has increased by 220% (1992-2009)

…and…

Number of international Intra-EU27 routes

0

500

1.000

1.500

2.000

2.500

3.000

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Source: OAG summer schedules

Nbr o

f rou

tes

(city

to c

ity)

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What Have We Achieved?Successes of the Single Market

…lower fares…Emergence of market for low-cost air services(now over 1/3 of the Intra-EU market).

Supply by carrier type within EU27

0

1

2

3

4

5

6

7

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

Source: OAG w inter schedules

Wee

kly

seat

s av

aila

ble

(mill

ions

)

IncumbentOthersLow cost

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Passengers actually carried

0

5.000.000

10.000.000

15.000.000

20.000.000

25.000.000

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

EU–Latin America Aviation Relations:Growth in EU-South America & Caribbean Market (PAX)

22.1 million

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EU–Latin America Aviation Relations:Number of carriers operating (Scheduled Pax)

Number of scheduled passenger carriers

0

5

10

15

20

25

30

35

40

45

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

19

38

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Largest Markets – on Latin-America sideLargest EU-Latin American Pax Markets - 2008

0

1.000.000

2.000.000

3.000.000

4.000.000

5.000.000

6.000.000

BR MX DO CU AR VE CO

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Largest EU-Latin American Pax Markets - 2008

0

1.000.000

2.000.000

3.000.000

4.000.000

5.000.000

6.000.000

7.000.000

8.000.000

ES FR UK DE NL PT IT

Largest Markets – on EU side

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Unprecedented Challenges

1. Global economic downturn2. Volatile fuel prices3. Increasing environmental pressure4. Security measures5. Increasing costs from congestion – on land and

in the air6. Most recently: volcanic ash in Europe

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Key Objective: “Ensuring Sustainability of the Sector’s Growth”Means:

1. Continue to lead towards highest safety and security standards – a pre-condition for growth

2. Ensure environmental sustainabilityComprehensive approach

3. Tackling the capacity crunchAvoid/reduce bottlenecks on the ground and in the air

4. Competitiveness of the industry Cost reductions, efficiency and consolidationNo bail-out – but accelerating structural reformRemoval of out-dated ownership and control restrictions

5. Share success of further market access

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I. Bringing existing bilateral agreements into line with Community law

II. The creation of a “Common Aviation Area”with neighbouring countries

Parallel process of market opening and adoption of EU legislation

III. Conclusion of ambitious global agreements with key partners (US, Canada, Australia, New Zealand, India, China, Russia, Brazil…).

Going Beyond Europe: The Three Pillars of the External Dimension

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Pillar I: Progress on the EC designation

104 non-EU states have accepted Community designation

Nearly 900 Bilateral ASAs (around half) have been brought into conformity with Community law (representing 70% of extra-EU traffic)

43 “Horizontal” Agreements covering 725 ASAs (since September 2004)

Horizontal Agreements with: Brazil, Chile, Mexico, Panama, Paraguay, Peru and Uruguay

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Pillar II: A Wider Common Aviation Area

58 States – Approx. 1 Billion inhabitants

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With key and like-minded partnersAim: to “normalise” aviation by combination of:

Market openingRemoval of investment barriers (airline ownership)Regulatory convergence

EU-US Agreement (1st and 2nd stages)First stage agreement has been in effect since 30 March 2008Second stage agreement initialled on 25 March 2010 following eight rounds of negotiations which started in May 2008.

EU-Canada Agreement Phasing in of full Open Aviation Area (OAA)All market aspects coveredInvestment & regulatory convergence key

Australia and New Zealand (Negotiations started in November 2008)Next: Brazil (Negotiating mandate requested 5 May 2010)

Pillar III: Comprehensive Agreements

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Conclusion: The EU Approach in a NutshellMarket integration: from national to single EU marketMarket liberalisation: Gradual but completeHigh standards: a sine qua non for growthCommon rules: level playing field, simplicity/clarityPooling of resources: European institutions (EASA) and ambitious EU projects (SESAR)Share successes and benefits with neighbours and key partnersAviation is international/global by its very natureStates and World regions share the same key challenges in aviation (so do Latin America and EU)International cooperation will help us meet the challenges.

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Fast growing EU-Latin America aviation market– we must ensure it is sustainable!Most Latin-American countries now recognise EU law and carriers – an important first stepThe EU wishes to enhance EU-Latin America aviation cooperation in all areasSignificant scope for technical cooperation (safety, ATM, environment…)Perspective for comprehensive aviation negotiations between the EU and BrazilWe wish to build on the success of this aviation summit!

Conclusion: EU-Latin America Aviation Relations

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Thank you!Obrigado!Gracias!

Daniel.Calleja-Crespo@ec.europa.eu

http://ec.europa.eu/transport/air/index_en.htm