Christoph Köppchen - ACI Europe

Report
THE SOCIAL IMPACT OF THE
PROPOSED EU REGULATION ON
GROUND HANDLING
Christoph Köppchen, Manager Economics
31 May 2012
European Parliament, EMPL Hearing
ACI EUROPE MEMBERSHIP

REGULAR MEMBERS:
180
- Number of Airports operated:
405
- Countries:

WORLD BUSINESS PARTNERS:

National Airport Associations:
46
155
8
2
GROUND HANDLING – THE NEED FOR A
GOOD QUALITY OF SERVICES

WHAT IS CONSIDERED AS ‘GROUND HANDLING’?
> Passenger and baggage handling: check-in, baggage delivery
> Freight & Mail handling; Ramp handling (aircraft marshalling and loading)
> Fuel & Oil
> Cleaning, Catering, Aircraft maintenance, etc.
 No Ground Handling: Security, PRM, Customs

WELL-PERFORMING GH OPERATIONS ARE KEY!
> Complex and interdependent operations at airports
> Quality & costs of GH services = competitive advantage…or disadvantage!
Under-performance:
Delays and inefficiencies in the whole network!
3
THE GROUND HANDLING MARKET TODAY

A COMPETITIVE MARKET AT EU AIRPORTS
> Most GH categories: Fully opened at all EU airports above 2 mio. pax
> 4 categories (ramp, baggage, fuel, freight):
 Minimum number of 2 handlers at airports > 2 million pax

Self-handling: Minimum number of 2 licences at airports > 1 mio. pax
Space, efficiency and safety considerations!

INDEPENDENT HANDLERS DOMINATE THE MARKET
Sources: European Commission, KPMG and ACI EUROPE.
4
GROUND HANDLING – THE SOCIAL IMPACT
OF THE EXISTING DIRECTIVE 1996/67

GROUND HANDLING = LABOUR-INTENSIVE SEGMENT
> 65-80% of GH costs are staff costs
> Competition on price = wages/social conditions

THE EFFECTS OF COMPETITION SINCE 1996
> Prices of Ground Handling services:
ca. -25%
> Low-margin business in a highly competitive environment
> Pressure on working conditions of staff & quality of service

COLLABORATION OF SOCIAL PARTNERS AT EU LEVEL
> Joint Statement of three out of four Social Partners in April 2011
5
THE COMMISSION PROPOSAL:
IMPACT ON SOCIAL CONDITIONS

FURTHER LIBERALISATION OF THE GH MARKET
> Minimum number of three Ground Handlers at airports above 5 mio. pax
> Full opening of the self-handling market
Increased pressure on prices & working conditions

SOCIAL SAFEGUARDS IN THE PROPOSAL
> Clarification on the possibility to have national laws on transfer of staff
> But: No obligation for a binding transfer of staff at national level
Insufficient social safeguards in the proposal

TRAINING REQUIREMENTS FOR STAFF
> Minimum training of 2 days for staff in Ground Handling
Progress, but one week would be preferable
6
THE COMMISSION PROPOSAL –
OTHER KEY AREAS

MINIMUM SERVICE STANDARDS
> Key to ensure efficient operations at the airport
> Regulation introduces right for airport to set standards
Important improvement, but need to ensure enforcement

COMPETITIVE DISADVANTAGE FOR AIRPORT HANDLERS
> Legal separation of airport handlers/CI: Counter-productive
> No sub-contracting for airports, but allowed for all 3rd party handlers
Problematic: No level-playing field for GH services

ADMINISTRATIVE BURDEN
> New procedures for Centralized Infrastructure & Reporting
Problematic and disproportionate, added value unclear
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CONCLUSIONS: PRIORITIES FOR THE
LEGISLATIVE PROCESS

FOCUS ON QUALITY OF SERVICE OF GH SERVICES
> Provide airports with tools to set minimum standards

NO DOGMATIC APPROACH TO MARKET LIBERALIZATION
> Keep provisions of existing Directive: Decision at national level!

INTRODUCE STRONGER SOCIAL SAFEGUARDS
> Introduce binding transfer of staff in Art.12
> Increase training requirements

TAKE INTO ACCOUNT THE OPINION OF SOCIAL PARTNERS
> Improvements to tender procedure, length of licence and social clause
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THANK YOU
www.aci-europe.org
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