Home Airline News Airlines with poor slot utilization may lose them earlier

Airlines with poor slot utilization may lose them earlier

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The civil aviation ministry is considering a proposal to reallocate airport slots to airlines every two months based on utilization levels, deviating from the current practice of reviewing after a year to make better use of limited capacity, two officials said.

Airlines can currently claim the right to a slot if they can meet the slots each year, i.e. operate at least 80% of the departures submitted to the regulator.

While more frequent review ensures that the airport is using its resources optimally, it can present operational challenges for airlines, especially when demand drops. A good slot at a busy airport is an airline’s most valuable asset. However, airlines often block the slot allocated to them without fully utilizing them. This leads to a waste of scarce resources and impacts on the revenue of airport operators.

Currently, the proposal is in its initial stages and several rounds of negotiations with airlines and airports are expected, one of the officials said, requesting anonymity. The slot allocation guidelines were last revised in 2013.

“The trigger is always those slots that are allocated but not fully used. For example, over the years Air India’s focus has become more international and their domestic slot utilization has declined, with IndiGo and SpiceJet complaining. Airport operators have also complained that airlines are not operating the slots allotted to them as it leads to loss of revenue,” said an airport director, requesting anonymity. “This may help new entrants, but it will also be a challenge for them long term.”

If an airport has approximately 70 landing slots per hour and airlines use only 65, then that is a loss of landing fee, parking fee, taxi fee and revenue from passenger spending on food and beverage, retail and shopping, among others. .

Airlines are skeptical about the benefits of such a move. “Right now limited airports have a problem; otherwise, some airports do not have such a problem. Our main challenge will be mainly the hubs which are Delhi and Mumbai and to some extent limited airports like Goa, Pune and Srinagar. Besides, airports like Bengaluru and Hyderabad still have free slots and each one has grown from Bengaluru. Even Akasa is growing from there,” said an airline executive on condition of anonymity.

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