Route Development & Rumours

[JENNYJET]

This business of offering deals to secure a service is troubling to me as it smells of corrupt practice. UK and EU law requires open competition for contact negotiations and I am sure US law also requires transparency.

I recall a recent case involving BAe Systems and another with Rolls Royce Aero Engines and UK Government falling foul of regulatory standards when dealing with the Kingdom of Saudi Arabia.

To me, a deal equates to a sweetener and that is legally dangerous, I am sorry but I have had my head buried in European Law recently, pretty dense reading covering BREXIT etc. and other matters before me.

 

[Angie88]

This business of offering deals to secure a service is troubling to me as it smells of corrupt practice. UK and EU law requires open competition for contact negotiations and I am sure US law also requires transparency.

I recall a recent case involving BAe Systems and another with Rolls Royce Aero Engines and UK Government falling foul of regulatory standards when dealing with the Kingdom of Saudi Arabia.

To me, a deal equates to a sweetener and that is legally dangerous, I am sorry but I have had my head buried in European Law recently, pretty dense reading covering BREXIT etc. and other matters before me.

EU competition law primarily relates to the regulation of government intervention in markets or companies which are anticompetitive (monopolies). I wouldn’t say the airports/airlines are acting unlawfully, however I would say BHX needs to be a lot more competitive when negotiating with airlines (ie. make them an offer which is sustainable & good for both sides)

 

[JENNYJET]

Hello Angie and a belated welcome. I agree with reference to state intervention etc. most on this forum do not have the capacity to absorb a lengthy legal argument and as such, I referred to a personal discomfort. I feel BHX management needs a first class negotiator to secure and retain carriers to service vacant routes without the need of saccharine clauses.

 

[IanFarquharson]

Airports often strike a deal with airlines to cover marketing etc.
A certain airport rumoured to have paid an Far East airline £10m to launch services from there a couple of years ago.
Not going to name either but from a extremely reliable source, BHX just cant, wont and shouldn't go down this road but it might be the only way !

 

[58terminus]

A certain airport rumoured to have paid an Far East airline £10m to launch services from there a couple of years ago.
Not going to name either but from a extremely reliable source, BHX just cant, wont and shouldn't go down this road but it might be the only way !

Didn't they try that road a few years ago under PK? After a short distance it turned into a toll road and could not afford the tolls anymore.
Back to the start and find another route. Still studying the map

 

[richard winterbourn]

Hello Angie and a belated welcome. I agree with reference to state intervention etc. most on this forum do not have the capacity to absorb a lengthy legal argument and as such, I referred to a personal discomfort

From a personal point of view i find that sort of comment elitist and quite disparaging to many on this forum who understand the complexities of both commercial and international law. Please let us be respectful to all those who want to partake in discussions which relate to the airport with which we have got an affinity.

There should not be them and us on this forum...

 

[TheLocalYokel]

To me, a deal equates to a sweetener and that is legally dangerous, I am sorry but I have had my head buried in European Law recently, pretty dense reading covering BREXIT etc. and other matters before me.

So what is a 'deal' when it relates to airports? An airline simply not paying the advertised airport charges?

It's possible to obtain 'deals' in all walks of life. If I go to a car dealer and buy 20 new cars I don't expect to pay the advertised price per car, nor do I expect to pay as much per car as someone buying just one. When I renew my Broadband contract I always haggle and never pay the advertised price nor even the first reduction that I'm offered. That's a 'deal' I suppose because others might not be as peristent as I am and pay more for the same product.

If an airport wants a particular airline or a particular type of airline it's likely to offer it a better 'deal' than it would to an airline it's not as keen on. The 'deal' might be in the form of lower airport charges or even none at all. Even if an airport pays an airline a per passenger levy - I don't know that airports do this or have done so, but anecdotal gossip suggests it's not unknown - it can only do so within a framework of assisting the airport's overall profitability, or it will soon run into financial difficulties (but see my final paragraph).

I expect that major supermarkets pay their suppliers different rates for similar products depending on what a particular supplier's product brings to the profitability of the supermarket.

I realise that state-owned businesses, whether airports or anything else, have to be more careful as their powerful position might lead to allegations of illegal state aid under European law.

 

[Angie88]

I agree that’s ludicrous & I’m definitely not thinking along those lines! I do however think to remain competitive with the connectivity to Europe, there needs to be a new approach. I had really hoped to hear some announcements for w19/s20 by now to some much needed unserved routes in Europe. There’s only so many holidays you can plan around direct flights from Birmingham airport!

On a very different side note, have indigo & SpiceJet confirmed whether they will be using those reserved slots yet?

Thank you for the welcome Jenny!

 

[Ianbutty]

I think there is a blur between competition and offering a discount and state aid.

A company offering an inducement or offer is not illegal as long as it is not a bribe. Every time you buy one and get one free you are taking advantage of an inducement.

State aid applies directly and indirectly and as Ian F alluded to there are recent cases. And remember Charleroi? The EC is still pursuing that one.

Morals and law don't often mix well. I agree with Ian F, and I would rather BHX doesn't go there indirectly or directly. Better to maintain high morals than attract an airline only for them to disappear after 5 years or so as such inducements (to 'assist economic development' but really fund lower revenue for the airline) normally end in failure once the tie in period ends.

The government used tax free zones in the 1980's to entice overseas investment to south Wales and Silicon Glen. Many came and many left when the tax free period ended leaving many a problem. And how many BOGOF deals have only led to disappointment.

 

[58terminus]

Better to maintain high morals than attract an airline only for them to disappear after 5 years or so

I agree with your post Ianbutty but keeping an airline for 5 years? Pay the backhanders!!

 

[Ianbutty]

I agree with your post Ianbutty but keeping an airline for 5 years? Pay the backhanders!!

Oh yeah...oops.

 

[finchy168]

Birmingham Airport to be Solihull Summer Fest headline sponsor

Plans announced as part of eightieth anniversary celebrations.

thebirminghampress.com

BHX Sponsoring Sollihull Summer Fest

 

[BHXsupporter]

AirBaltic sees A321XLR as ideal for transatlantic flights
Jun 19, 2019 Victoria Moores

https://atwonline.com/paris-air-show-2019/paris-2019-airbaltic-sees-a321xlr-ideal-transatlantic-flights

Speaking to ATW on the sidelines of the (Paris) show, Gauss said the A321XLR launch was a “very interesting development,” as it could be the step-change needed to launch long-haul flights from the Baltics. “From our perspective, it puts our main Riga hub in a different place, because this aircraft can go from Riga or the other Baltic capitals to cities in the US. For us, it’s an interesting development because—in a couple of years’ time when we have done our development—that might be the right thing to come.” Despite the opportunity, Gauss stressed that his main focus continues to be short-haul network development from the Baltics and the airline’s transition to an all-A220 fleet. “I’m a very strong believer that there will be direct long-haul flights coming from the Baltic capitals. It is an area with 6 million people, the Baltics, and we have zero long haul today. I think it’s a natural development, but we haven’t changed our position.”

For Riga, read BHX wrt approx. local population pull - in a world without MAN and LHR!

 

[rollo]

Going East and not Norwich !

The route(s) will be surprise to this forum as have been mentioned before
It / they may not happen at all but the source couldn't be any better.

Going on a bit of a fishing expedition but is today's news from Wizz related to the above posts going east or is there more to come hopefully? Not wishing to compromise any confidential information anyway Ian.

 

[IanFarquharson]

Going on a bit of a fishing expedition but is today's news from Wizz related to the above posts going east or is there more to come hopefully? Not wishing to compromise any confidential information anyway Ian.

No not Wizz

 

[rollo]

No not Wizz

Thank you, interesting.

 

[GliderPilot]

Think this has been asked already but is it long haul or short haul to the East Ian? Thanks, just curious

 

[Angie88]

My bet is SpiceJet or indigo (I have zero inside knowledge). Based on the fact they both have slots ready to use... otherwise Cathay would be amazing surprise!

 

[GliderPilot]

That would also be my best guess Angie!

 

[58terminus]

Going on a bit of a fishing expedition but is today's news from Wizz related to the above posts going east or is there more to come hopefully? Not wishing to compromise any confidential information anyway Ian.

Finding the correct bait that will make Ian bite is very difficult Rollo