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BARIN Chairman New Year’s Address 2006

By Points of view

New Year’s Address 2006 of the BARIN Chairman, mr. Coen Waasdorp, at the BARIN New Year’s Informal Gathering on 27 January 2006, at the Schiphol Hilton Hotel

( MoT stands for Ministry of Transport Ministerie van Verkeer & Waterstaat)
( An full size artifical cow was placed next to the speaker’s chair on the podium)

Ladies and Gentlemen,

It is a great pleasure to see that so many of you are joining us again at our New Years Gathering, which traditionally is the “hekkensluiter” of the many New Year receptions taking place in this first month of the year.

We thank Schiphol Hilton for their kind gesture to host us once again in their renowned way.

Now and than I will be using some Dutch expressions in my speech, which somehow relate to my companion standing next to me (Annie -The Cow). Gradually it will become clear why she is among our guests today.

At the end of my last year’s address I invited the President of the Schiphol Group and the Director General of the MoT to ring the bell with us for “Nieuwe ronde nieuwe kansen”, in other words for a new round with new chances and opportunities to create a win-win situation for The Dutch Economy, Schiphol Airport and us, the Airline industry active in this country.

I do not want “Oude Koeien uit de sloot halen” however please allow me to go through some of those chances and opportunities for which we did ring the bell for last year.

A year ago they were very relevant and let us see where we are now, one year later!

GENERAL
First a quick general overview:

Turning growth into profitability has never been more critical in our industry. IATA tabulated that airlines will end 2005 with a US$6 billion loss—on top of US$36 billion in losses accumulated between 2001 and 2004. As we battle the high price of fuel, cost efficiency will continue to be a top priority—not only for airlines but for every partner in the value chain from producer to consumer, including airports and air navigation service providers, handling agents and the distribution channels.

Airlines have stringently reduced non-fuel unit costs continuously since 2001.
The price of oil has risen from an average of US$22 per barrel in 2003 to US$54,5 per barrel Brent in 2005.

Not withstanding continuous and successful cost reductions airlines are expected to return a loss of US$4.3 billion in 2006. The outlook for 2007 is somewhat brighter when a positive return of US$6.2 billion seems feasible. This is a net profit margin of 1.5%, not even enough to cover the cost of capital and nowhere near recovering the billions lost since 2001. Also much less than the 4.1% profit which Schiphol Airports makes on security, not quite in line with the ICAO recommendations, who do not allow profit making on security charges!

Needless to say that The Drive for Change still proves to be a long and difficult road ahead of us and involves all our Industry Partners.

Government & Security:
I remember saying last year that the Dutch government, again and again stressed that Schiphol Airport is of great importance due to its main port function and a driver of the Dutch economy.
TODAY (28 January 2005), I said, is the moment for the government to show its commitment to Schiphol Airport and to take on its account the geo-political related security costs of the airport, similar to actions taken by other countries and ensuring a level playing field among airlines in the world.

The very high profits continuously generated by Schiphol Airport, and the increasing dividend paid out to the major share holder – the government – could be a source of funding.
One might say, abusing my companion here, Annie The Cash-Cow.

Unfortunately the government has still not been receptive to our joint pleas, Schiphol and BARIN have put forward, other than that they are studying our proposal to make Schiphol “Schengen exempt”. As from 9/11 stringent checks and control meganisms are unfortunately needed, which requires every passenger to prove his identity at many checkpoints. This exemption measure alone, according to Schiphol, would create a cost saving of more than Euro 40 million.

It would enable Schiphol to maintain its favorable international position to stay in the top 4 of the European Airports and not loose this position to another European airport, such as the runner up Madrid.

Instead of doing all what is possible to contain the costs of security for the industry: The government approved an additional security charge increase in Nov. 2005. A close to 40 % increase on security charges IN ONE YEAR!

It does not stop there as further airport charge increase per April 2006, has in the meantime also been approved.

Schiphol Airport has one of the highest, if not the highest security charge of all airports. Food for thought for those who believe in benchmarking! (ANNIE, THANKS AGAIN FOR THE CASH)

One should not forget that Security Measures are not equally implemented on the various modes of transport, creating an unfair competitive environment. Compare a passenger traveling from Schiphol with the high speed train to Paris, no security checks and costs at all, but the one traveling by air is subject to a range of security rules and costs.

Government – Privatization of Schiphol Group
Talking about the intention of the government to privatize the Schiphol Airport Group, we still maintain our position that BARIN has strong reservations:

1. Seen from a European perspective the “marginale toetsing” of the increases of the rates and charges proposed by Schiphol Airport as implemented by the Ministry of Transport in the past, in particular in the light of the monopolistic position of Schiphol Airport, can be challenged for its outcome on on hand. On the other hand it may prove to be a too limited basis from which to build a new economic regulation.

2. Only once a comprehensive set of new economic regulations is in place AND has proved its effectiveness to the satisfaction of all MAJOR STAKE HOLDERS, the privatizationcould than still be considered.

It would probably be wiser to cross the bridge into TERRA INCOGNITA after ALL the STAKE HOLDERS are satisfied with the new set of rules instead of a fast financial gain, the height of which still seems to be quite debatable. (ANNIE, THANKS AGAIN FOR THE CASH)

As we are on the subject of legislation.
As recent last Wednesday the Vice Minister of Transport, mrs. Melanie Schulz van Haegen mentioned in a meeting of parliamentary Permanent Committee of Transport that present Economic Regulation set up, designed by her Ministry, has been fully completed.
We came to know that such an important regulation, classified as a By Law in Dutch Algemene Maatregel van Bestuur (AMvB), and part of the New Aviation Law, does not have to pass parliament. It only takes the Cabinet to decide.

I wonder whether that is the right way to handle such crucial part of this New Law making.

In addition I can tell you that we have signaled that there are still some blanks in this By Law, a By Law which is supposed to protect the users against abuse of economic forces in relation to future charges- and conditions settings. This light handed regulatory framework offers insufficient balance to encourage negotiations between various parties in the marketplace. Efficiency incentives for the airport are not included, and it does not accommodate any stronghold to agree on quality levels.

As I stressed before: a sound proof economic regulation is required to guarantee the airport’s role as a catalyst for the overall economic development. Privatization must benefit the general public, travelers, airlines and shippers, not just the operators of the airport and the government.

“Milking the Cow”

I am sure you heard of that expression and YES you have guessed it. We, the airlines, are often looked at as Annie The Cash Cow, especially by regulatory authorities. I will touch on how wrong that is, a little later.

"There seems to be a TAX epidemic in the air at the moment”!

It is not only airports, the EU Commission is also pretty busy in trying to tap the flow of cash of the airlines , for their own political benefits, or to create extra taxes. Take for example the

Denied Boarding Charge
An EC Regulation on compensation to passengers in the event of denied boarding, long delays and cancellations became law on 17 February 2005.

A final piece of the previous European Commission’s legacy of failure with respect to air transport policy. The current Commission should be approached to seek remedies to the regulation’s many flaws.

· We are not opposing the rules on compensation for denied boarding. However, it is wrong when airlines are made responsible for what is beyond their control.

· The Regulation is complex and unfair. E.g. a High Speed Rail journey from Amsterdam to Paris is not subject to a similar legislation. So different modes of transport, competing for the same traffic, are treated unequally.

· The potential for chaos is enormous as airlines seek to apply the complicated rules at airports in cases of denied boarding, cancellation and delay. The aim must be to provide simplified, efficient and pleasant travel experience but the effect of this Regulation is far from it.

· Just as importantly, the regulation has created a barrier between the airlines and their customers – a barrier largely comprised of false expectations. It has created an impression that every service disruption can result in a financial settlement, regardless of whether the disruption is due to extraordinary circumstances outside the airline’s control.

· “By creating an atmosphere of expectation, clouded by ambiguous rules, the Regulation has given rise to a situation out of which can emerge tension and confrontation. Win-win becomes win-lose”.

· IATA estimates that the total cost to the industry of this regulation could top US$700million per year.

A strong call for benchmarking of all European regulations against their economic impact should be made.

and than this idea of an EU subsidizing Tax?

Last week Austrian Chancellor Wolfgang Schüssel, currently chairing the European Commission, called for new taxes to fund the European Union, solving European Union budget problems. He is suggesting a levy on short-term financial transactions as well on air travel.

Now we are told that our passengers should be subsidizing those parts of the European economy which absorb the E.U.’s funds, sectors such as agriculture which have nothing to do with aviation, or such as railways, which are our direct competitors."

Airlines are regularly defending themselves against new taxes – and won, such as.

the proposal for a Developing Countries Tax

France and Germany launched the idea of a new air travel tax last year as a way of channelling money to the developing world. Even mr Zalm, our Minister of Finance, liked the idea. But airlines and many E.U. governments opposed the plan and the idea went nowhere.

So we had the prospect of a tax to fund aid to the developing world – a tax which would disproportionately target travel to the very parts of the world which were supposed to benefit from it"

The Commission should take leadership to reform outdated regulations, stop creating unrealistic new taxes with no bearings at all with aviation, implement an effective single sky policy, and regulate monopoly suppliers—airports and air navigation service providers.

Action in these areas will help build a competitive industry and sustain affordable air travel.

Schiphol Airport Charges

Since 1999 the AAS airport charges have been increased with about 40%
Quite in contrast with the average price of an airline ticket of a package holiday.

As you know we are, already for years, pointing at the almost NON existence of a cost consciences and real cost efficiency drive of the Schiphol Management, and for that same reason we have been and continue to counter the continuous excessive airport charges increases at our national airport. E.g. a 16% increase in operational costs, the basis for the 2006 rates and charges, and a much lower increase in number of expected passengers, cannot be accounted for, to our opinion.

It is remarkable that MoT officials very much encourage us to embrace the new Economic Regulation, linked with the Schiphol privatization plans, as a much better way of solidly judging future Schiphol charge increase proposals.

To us this proves once again, that they actually admit that their current “Marginale Toetsing” is, and has been irresponsibly inadequate.

For that very reason we will stay firm, and have once more clearly stated our case in the formal MoT Hearing Committee – last December; a hearing addressing our formal objections filed against the airport charge increases over the last 4 years. The formal process is still on going and, if needed, we will continue to use legal means, with the objective to have the irresponsible light handed “marginale toetsing” revoked.

Consequently BARIN, together with our associated partners IATA- the International Air Transport Association and our operational colleagues of SAOC- Schiphol Airline Operators Committee ,we are forced to start also a formal objection procedure against the approved airport charges increases per April 2006, and have recently filed our objections with the MoT.

Not to labor this point to much, I still like to mention a couple of examples though:
1. Very recently in connection with the “Bouw Fraude” Schiphol has settled their claim of having been paid to much on constructions works, by accepting a lumpsum pay off of Euro 500.000, and donating that to charity. We – users of this airport – have paid for these construction investments. So, we, have paid too much, (ANNIE, THANKS AGAIN FOR THE CASH) .
Schiphol’s CFO – mr.Verboom – continuously counters our objections, by saying that these increase are needed for investments and we (Schiphol) needs to invest! I hear, that present offers for constructions works at Schiphol are in average 30% lower than before! The last 10 years approx 2 billion Euro’s has been invested in aviation related projects, paid by the airlines, so 30% of that amount is a lot of Euros. As we would say in Dutch, the last word has not been spoken about this sore point.

2. There is a dual till system; aviation and non aviation. We are charged for the aviation activities and investments. Schiphol is extensively using the aviation till infrastructure, we as airlines pay for, making large sums of money and profits which go straight in to the non aviation till.
For example Advertising on- and in Airbridges (de slurven), Office rental income for directly related aviation activities. Parking – the same thing – and the parking fees recently increased again – with a hefty10%, if I am not mistaken. I can mention many more examples, but won’t bore you with them.

From unconfirmed sources we learned that also the EU Commission is looking at the aggressive approach of airports advocating a dual till set up. Within the EU one tends to be more and more in favor of a straight forward single till financial structure, where all revenues and costs are belonging to one till. We will follow that very closely.

3. Last year I also reiterated that Air transport is evolving to an industry whereby low cost is the key issue. This is what consumers demand from ALL the airlines. Airports need to reduce costs for all travelers, shippers and airlines. Building limited use low cost terminals is not the answer. Building low cost airports for ALL airlines should be the objective.
Where low cost facilities are developed, the bottom line is:

– These facilities must be available to all carriers

– Security charges must be equal for all airlines.

What do we have now: a low cost terminal called H-pier, only non Schengen airlines are allowed to use and are offered a 20% discount on the airport charges. It so happens that the strongest low cost airlines at Schiphol are coming from the non Schengen countries, and for example our successful Dutch low cost BARIN member – transavia.com – is not offered this kind of discounted airport service.

Please let me stress once again that ALL CARRIERS have to operate on a low cost basis and not only those carriers with the label "low cost operators" and it is of course unheard of to discriminate carriers coming from schengen or non schengen countries . All users at Schiphol have paid or are paying for the H-Pier investment, and therefore all should benefit from it in one way or another.

When it is Schiphol’s intention to offer differentiated services and charge levels, than let’s talk about, so that we – customer and supplier – can evaluate such an idea and discuss innovating changes in all constructiveness together, with a win-win objective as THE basis.

4. The drive for Cost reductions en cost effective measures does not only applies to Airports but also to other monopoly suppliers of airlines. Take the LVNL – Air Traffic Control Authority. Regularly we have stressed that the increasing costs of the use of the state owned Meteorological Services, KNMI, the Dutch ATC is forced to make use of, has to be cost efficient, or LVNL should be allowed to contract a more competitive Whether Service. The present cost-plus scenario at these organizations show no sign of an efficiency drive, needed in a market environment whereby airlines sell their products in a very competitive, non level playing field, environment.

FUTURE

Last year I invited Schiphol to rise to the challenge to meet the requirements of the travelers, the shippers, the distribution chain and the airlines to lower costs and to lower charges and Barin promised to take its responsibility to go one step further than just a consultation process.
We have to look not only at the present and the next year, but also at the mid and long term.

Schiphol, together with Barin initiated the TFAC, Task Force Airport Charges. The members of this Task Force, BARIN, SAOC and IATA met at various occasions to go through the operating- and investment cost to get a feel of the financial household and to possibly assist Schiphol in finding ways and means to reduce cost and to initiate cost efficiency measures.

Unfortunately till now, the objectives have not been met YET, but Schiphol values continuation of this Task Force input.

We recognize the good work the interim COO, Alain Maca, has done in the short time he was here, until a permanent appointment was made by having Ad Rutten re-boarding the Schiphol Group.

Ad Rutten has shown, with the recent reorganization, that he considers cost- reduction and efficiency as a first priority.
That’s as music in our ears! Integrating the two business units, Air- and Landside, long overdue and now in place, will no doubt enhance efficiency and cost reduction.

We have confidence in Mr. Rutten, an aviation man pur sang, with extensive experience and knowledge of operations and management of the entire airport, and we will give him and his team the support they need.

Ad Rutten, if you allow me to address you personally, you told us that one of your first priorities is to sit together with us – your customers – to define those needs and objectives, on which an industry wide consensus can be reached.

I would therefore kindly invite you, Ad, to step forward.

Let us together to take this “Koe bij de hoorns” (Take this Cow by the horn) as a symbolic sign of new era in the relationship between Schiphol Airport and the customer Airlines.

A new era in which cost reduction and efficiency are the keywords. This will than lead to the fulfillment of the objectives of your customers: higher productivity and lower cost. A win-win !

Please join me in wishing all here a healthy, peaceful and successful 2006 Thank you for your attention!

BARIN Chairman New Year’s Address 2005

By Points of view

BARIN Chairman New Year’s 2005 Address

Schiphol Hilton, 28 January 2005
New Year’s Address of the BARIN Chairman, mr. Coen Waasdorp, at the BARIN New Year’s Informal Gathering on 28 January, 18.00 hrs at the Schiphol Hilton Hotel

Dear guests, members of the travel industry, members of the BARIN.

A special welcome to Mrs. Tammenons, Director General of the MoT and Mr. Cerfontaine President Schiphol Airport.

BARIN, the Board of Airline Representatives in The Netherlands is extremely pleased that so many of you are joining us this day at our New Year´s Informal Gathering., which is becoming a tradition, very much thanks to the generous and excellent hospitality of the Schiphol Hilton.

GENERAL
The crisis of the recent years have taken us beyond the habitual ups and downs of a business cycle. The present reality is in a state of constant change, where crisis are no longer extraordinary events.
Initial projections for 2004 saw the industry making a small profit. The very high oil prices will have a very substantial effect on the outcome of the financial year for the airlines. The industry needs a new cost structure, a lower cost structure in order to face the new economic realities.
Airlines have acknowledged their drive for significant changes with the prime focus on “Simplifying the Business”. Here four examples:

– Elimination of paper tickets as from 31st of December 2007 and the sole use of electronic ticketing.
– Implementation of “bar codes” to simply the process of boarding.
– Implementation of Common Use Self Service Check-In kiosks at airports and to promote the use and share costs of the self-service technology.
– Implementation of Radio Frequency Identification technology for baggage sorting and handling to reduce the number of mishandled baggage.

LOW COST TERMINALS
Air transport is evolving to an industry whereby low cost is the key issue. This is what consumers demand. Airports need to reduce costs for all travelers, shippers and airlines. Building limited use low cost terminals is not the answer. Building low cost airports for ALL airlines should be the objective.
Where low cost facilities are developed, the bottom line is:
– These facilities must be available to all carriers
– Transparency is a must
– Security charges must be equal for all airlines.

Please let me stress that nowadays ALL CARRIERS have to operate on a
low cost basis and not only those carriers with the label "low cost
operators". Those carriers which do not endorse this business model will
soon be out of the business.
SECURITY
We have a higher level of security, but not efficiency. We are battling paperwork instead of terrorism. And our passengers and air cargo shipments are being hassled. We are confusing inconvenience with effectiveness.
Governments must act urgently to find a harmonized set of rules. To finance security measures is also a problem. Why do governments pay to keep their citizens safe from terrorism everywhere except in airports or on airplanes? Airlines and travelers should not be the exception.
The cost to the industry is US 5 billion per year for extra measures since September 11. A number of countries accepted to take on some of this cost. The US is THE example. All governments must act quickly to pay for what is their responsibility.
Effective consultation is needed. We all want a secure aviation environment, not in the least due to its economic importance. Airlines can help make security measures operationally effective and efficient. Too often we are not involved until decisions have been made. Today, we are very much battling paperwork instead of terrorism.
The Dutch government, again and again stresses that Schiphol Airport is of great importance due to its main port function and driver of the Dutch economy. NOW is the moment for the government to show its commitment to Schiphol Airport and to take on its account the geo-political related security costs of the airport. The very high profits generated by Schiphol Airport and the dividend paid out to the major share holder, the government, could be a source of funding.
AIRPORT CHARGES
BARIN would like to congratulate Schiphol Airport with the growth figures achieved in 2004.
By doing so, we recognize that the airline industry has made an extreme effort to ensure that the negative trends of the last couple of years, for reasons known to all of us. The airline industry hasclearly demonstrated that it listens to the needs and requirements of its customers.
To state it quite bluntly customers want a top-notch product for very attractive prices. In particular during the recent down-turn in the economy, the aggressive pricing policy of airlines have moved the market, be it the business, the leisure or tourist segment.
The airline industry has managed, by adapting a model of stringent cost cutting, to offer their clients top products for prices not shown before. In the last ten years the average yield dropped in excess of 30%.
On the other hand, the airline industry, the key generator of traffic flows through airports, has not “yet?” seen that airports have applied similar stringent cost cutting exercises resulting in lowering airport charges for airlines and or airport taxes for passengers. The profit margins of airports, plus the potential cost savings opportunities, offer amply scope to lower the costs of the airport customers (airlines and their passengers and shippers).
It is with great concern to see that Schiphol Airport for 2005 will increase its cost base with over 16% and that the airport charges for Schiphol again will increase. The increase of airport charges of 3,2% is, in the view of the airline industry too high and unacceptable.
Too high when considering the needs of the traveler, which is looking for lower prices; too high when considering the development of the rates at other European benchmark airports (Frankfurt +1,75% and Madrid +2%), and too high as the costs of operating the airport is rising faster than the traffic volume. With a 38% increase in airport charges for the period 1999-2003 Schiphol is on record as the airport with the steepest yearly increases, when compared with the benchmark airports in Europe.
Besides the increases in the user charges of Schiphol airport, it should also be noted that the security charges are one of the highest in Europe. E.g. in Copenhagen a charge of EU 3 per passenger is applicable for, from our point of view, the same services rendered as at Schiphol where around EU 11per passenger are being charged.
We again have objected to these increases, and although the Executive Board of SG did recognise the validity of our standpoint, gave the priority to their prime responsibility to maximise the profitability of the airport, enabled by the legislator. So they advised us to go to the legislator the MoT. We did and much to our dismay we have been told by the MoT that they have been given, by law, hardly any authority and no influencing tools to make the airport management intensify cost control and reduce their cost in order to set a more realistic charges policy.
The industry’s value chain is broken. it is often said that Airlines do the flying and everybody else makes the money. Airports make record profits while airlines lose billions. Our partners should be profitable. But happy airport monopolies achieving margins exceeding 25% while airlines lose billions is not acceptable anymore.
MINISTRY OF TRANSPORT (MoT)
BARIN has written to the Secretary of State of the MoT, repeatedly expressing many aspects which, in our view, are valid and should be acted upon. The outcome of this correspondence is not quite satisfactory. The Ministry of Transportation used a “marginal trial” (marginale toets) of the proposal by the government owned Schiphol Airport. In the view of BARIN there should not be a “marginal trial” but a “solid judgment” by the ministry of Transportation of the charges proposal by Schiphol Airport. One might wonder what will happen if it is decided to privatize Schiphol Airport.?
We want to stress that an economic regulation is required to guarantee the airport’s role as a catalyst for the overall economic development. Privatization must benefit the general public, travelers, airlines and shippers, not just the operators of the airport and the government.
Constant cost reduction is critical to any business—except monopolies. It is no longer acceptable that airport charges must increase every year again and again.
Consequently BARIN, together with our associated partners IATA- the International Air Transport Association and our operational colleagues of SAOC- Schiphol Airline Operators Committee ,are forced to start once again a formal objection procedure, and have filed such at the MoT, yesterday
FUTURE
Having made the previous observations, BARIN,in concert with IATA and SAOC, invite Schiphol Airport to rise to the challenge to meet the requirements of the travelers, the shippers and the airlines to lower costs and to lower charges.
BARIN will take its responsibility to go one step further than just a consultation process. We have to look not only at this and the next year, but also at the mid and long term.
Schiphol Airport should sit together with their customers to define the needs and objectives, on which an industry wide consensus is reached. No doubt the rates and charges will than become the outcome of a balanced approach.
Being on the subject of Schiphol Airport and the Government, BARIN would like to draw attention to the opportunities of substantial cost saving. If the airport area could be made “Schengen Exempt” savings of over EUR 40 mln are feasible. Why “Schengen Exempt”? At this moment, due to security requirements, all travelers have to show their passport at check-in, which means the need to have Schengen passengers separated from non-Schengen passengers has been surpassed.
IN CLOSING
To conclude you might have wondered , what this bell is for ? Well, in Dutch we say “De bel voor de nieuwe ronde” and “nieuwe ronde – nieuwe kansen” i.e. “the bell of a new round and a new round new chances”.So lets have that bell ring at the beginning of this year, for a new round with new chances and opportunities to create a win-win situation for The Dutch Economy, Schiphol Airport and us, the Airline industry active in this country.
And who could do that better than the highest ranking representatives of the two government bodies, present here. May I invite the Director General of the MoT, Mrs Tammenoms and the President of the Schiphol Group Mr. Cerfontaine to ring this bell together, to kick start this new round within we should achieve this win-win objective. For photo click www.presslink.nl/barin/
Now I invite all of you to join me in bringing out a toast to this goal and that we all mAy achieve this in good health, in a more peaceful environment and prosperity.
Happy New Year!! Thank you for your attention.

5 November 2004 in Dutch & English translation

By Points of view

BARIN Press Statement 5 November 2004 (Dutch)

Luchtvaart is tariefverhogingen Schiphol nu echt beu !
Airlines are fed up with Schiphol Airport charges increases !

Schiphol, 5 november 2004. De luchtvaartmaatschappijen zijn de al jaren achtereen sterk verhoogde tarieven van Luchthaven Schiphol nu echt beu. Dat hebben de gezamenlijke luchtvaartmaatschappijen, vertegenwoordigd in de Board of Airline Representatives in the Netherlands (BARIN), Luchthaven Schiphol laten weten.
De door monopolist Schiphol opgelegde luchthavengelden komen niet tot stand in een vrije markt.
De BARIN heeft voorgesteld de Schiphol tarieven voor het komende jaar te bevriezen en de luchthavendirectie gemaand tot het nemen van de noodzakelijke kostenverlagende maatregelen en efficiency verbeteringen toe te passen, zodat een meer reële tariefstelling voor daarop volgende jaren kan worden gerealiseerd.
Een door Schiphol geplande kostenstijging van 16 % en de hieruit resulterende verhoging van de tarieven voor 2005, acht de BARIN volstrekt onaanvaardbaar en onverantwoord.
Een BARIN delegatie, ondersteund door IATA (International Air Transport Association), heeft middels een serie gesprekken met de Luchthavendirectie dit pleidooi uitgebreid en onderbouwd aan de orde gesteld. Ook in het laatste gesprek met de BARIN op 4 november, de zogenaamde Schiphol Consultatie, heeft Schiphol op geen enkele wijze gehoor willen geven aan het voorstel van haar klanten, door de stelling in te nemen niet tot bevriezing van haar tarieven voor 2005 over te willen gaan.
Binnenkort zal Schiphol wederom de door hen eenzijdig vastgestelde tarieven voorleggen aan het Ministerie van Verkeer & Waterstaat. De Nederlandse staat, als grootaandeelhouder, heeft belang bij hoge winsten van de luchthaven, zeker nu de staat een privatisering van Luchthaven Schiphol in gang wil zetten en daarbij een maximale opbrengst van haar aandeel zal nastreven.
Het Ministerie van Verkeer & Waterstaat heeft de laatste jaren, ondanks de bezwaren van de luchtvaartmaatschappijen, steeds weer de door Luchthaven Schiphol voorgestelde verhogingen goedgekeurd. In dat kader lopen er nog formele bezwaarprocedures met betrekking tot verhogingen van de luchthaventarieven in de jaren 2002, 2003 en 2004.
In recente brieven heeft de BARIN bij het Ministerie van Verkeer & Waterstaat op interventie aangedrongen met het verzoek dit onverantwoorde tariefstellingbeleid van de Luchthaven Schiphol een halt toe te roepen.
De gebruikers van Schiphol hebben het gevoel te moeten betalen voor de kunstmatig te behalen hoge winsten*. Bij doorberekening zouden uiteindelijk ook de passagiers van de luchtvaartmaatschappijen betalen voor de onterecht hoge tarieven, maar de luchtvaartmaatschappijen zijn door de huidige economische omstandigheden en marktwerking gedwongen hun tarieven steeds meer te verlagen en kostenbeheersende maatregelen te nemen.
De situatie van luchtvaartmaatschappijen is wereldwijd zorgwekkend. Al jaren lijdt de gezamenlijke burgerluchtvaart op jaarbasis miljarden euro’s verlies. In schril contrast hiermee stijgen desondanks de tarieven van Schiphol wederom voor het zoveelste jaar, om bij te dragen aan nog meer winst. Uit onderzoek van Verkeer & Waterstaat is gebleken dat in vergelijking met andere luchthavens, Schiphol in de laatste vier jaar de hoogste tariefstijgingen heeft doorgevoerd. Luchthaven Schiphol draagt hiermee in ieder geval niet bij aan een herstel van hun klanten; een gezond bedrijfsklimaat van de luchtvaartmaatschappijen is tevens in het belang van de luchthaven.
In BARIN zijn de Nederlandse en buitenlandse luchtvaartmaatschappijen vertegenwoordigd die gebruik maken van Luchthaven Schiphol.

* Resultaat (EBITDA) Luchthaven Schiphol: 2003:+ € 468 mio,2002: + € 353 mio, 2001: + € 397 mio

(below mentioned the free translation of the BARIN press release in english, dated 5 November 2004)

Airlines are fed up with Charge increases at Schiphol Airport
Schiphol, November 5 2004.

The airlines have had it and are fed up with the continuous implementation of increases of the airport charges at Schiphol. That was the message of the airlines given to the Schiphol Airport Authority, as voiced by the Board of Airline Representatives In the Netherlands ( BARIN ).
The charges of the monopolist Schiphol Airport are not set in a free market situation.
BARIN has proposed to freeze the airport charges for the coming year, and urged the management of the Airport to exercise the necessary cost cutting measures and efficiency improvements, in order to arrive at more realistic charge settings for 2006 and beyond.
BARIN considers the envisaged Schiphol cost increase for 2005 of 16%, and the corresponding charge increase unacceptable and irresponsible.

A BARIN delegation, with support of IATA (International Air Transport Association ), met several times with the management of Schiphol Airport, and extensively addressed this topic and explained its position. Also in the latest meeting of November 4, 2004, the so called Consultation meeting, Schiphol was not prepared to come closer to the proposition of its customers, and flatly refused to freeze its charges for the year 2005.

Shortly the Airport will present their unilaterally established charges to the Minister of Transport. The Dutch Government, being the majority shareholder of Airport Schiphol, is interested in a highly profitable airport, in particular because the Government is initiating the privatization of the Airport and will aim for maximization of its income as a result of the airport going public.

The Ministry of Transport has repeatedly approved the Airport proposals regarding the increase of charges, despite the protest of the airlines. In this respect the appeal and court procedures for the years 2002, 2003 and 2004 are still pending.

In recent letters BARIN has urged the Ministry of Transport to intervene by calling a hold to this irresponsible charge setting policy of Schiphol Airport.

The users of Schiphol can not escape the thought that is they, who have to pay for the ever increasing airport profits.* By passing these charges on in the ticket price, it is in the end the passenger who will have to pay the unreasonable high prices. At the same time the airlines are forced to continue to lower their fares, as a result of the increasing competition and economic downturn, and intensify their cost cutting exercises.

The critical situation in the airline industry is persisting. For years now the airline industry has suffered losses of many billions US dollars. In contrast to this, Schiphol is again increasing its chargesto further increase its profits. From a benchmark study, issued by the Ministry of Transport, it shows that in the past four years Schiphol showed every time the highest increases of their airport charges, compared to other competing airports in Western Europe. With further increases Schiphol Airport is in no way contributing to a recovery of their customers-airlines, although a healthy airline industry is in the end also beneficial to the airport.

BARIN represents both Dutch(home carriers) and foreign airlines operating to and from Schiphol Airport.

* Financial Results ( EBITDA ) Schiphol Airport: 2003: + Euro 468 million
2002: + Euro 353 million, 2001: + Euro 397 million

28 January 2005 in Dutch & English translation

By Points of view

BARIN Press Statement 28 January 2005 (Dutch)

28 January 2005

BARIN Press Statement
Luchtvaartmaatschappijen starten formele bezwaar
procedure tegen verhoging havengelden Schiphol

Schiphol, 28 januari 2005 – Op de jaarlijkse BARIN Nieuwjaars receptie in het Schiphol Hilton laat BARIN voorzitter Coen Waasdorp weten dat de luchtvaartmaatschappijen formeel protest aantekenen tegen de aangekondigde verhoging van de havengelden voor 2005 van de Luchthaven Schiphol en een bezwaar procedure aanhangig hebben gemaakt bij het Ministerie van Verkeer en Waterstaat.

BARIN, de belangenvereniging van alle luchtvaartmaatschappijen, die op Schiphol actief zijn, is zeer teleurgesteld vorige week via de media te hebben moeten vernemen over Ministeriële goedkeuring van de verhogingen.

Ook IATA, de wereldluchtvaart organisatie, die de Staatssecretaris van Verkeer en Waterstaat middels een tweetal brieven heeft laten weten het BARIN standpunt volledig te onderschrijven, deelt deze teleurstelling.

De Minister van Verkeer en Waterstaat heeft daarna per brief antwoord gegeven op de brief van BARIN van 6 december 2004, waarin BARIN haar bezwaren nogmaals aan de Staatssecretaris heeft toegelicht en om interventie en overleg vraagt. De Minister van Verkeer en Waterstaat geeft daarin aan dat de wetgeving haar slechts een marginale toetsing toestaat om de verhogingsvoorstellen van Schiphol te kunnen beoordelen. De goedkeuringsprocedure biedt de Minister geen ruimte om het verhoging voorstel van de Schiphol Groep voor de luchthaven gelden niet ter goedkeuring voor te dragen aan de Kroon. Tevens stelt de Minister in dat licht niet te zijn ingegaan op het BARIN verzoek om met haar nader van gedachten te wisselen over het door BARIN voorgestane 0 % verhoging scenario.

De tariefsverhoging voor 2005 is eenzijdig aangekondigd, terwijl de formele bezwaarprocedures van BARIN over de tariefsverhogingen in de afgelopen jaren nog niet zijn afgehandeld.

Daarmee wordt op geen enkele wijze recht gedaan aan een zorgvuldig consultatieproces van de luchthaven met haar klanten, zijnde de luchtvaartmaatschappijen.

Monopolist Schiphol heeft de tariefsverhoging wederom eenzijdig ingevoerd, met goedvinden van de overheid die tevens grootaandeelhouder is. Schiphol baseert de nu aangekondigde stijging van de havengelden op een exorbitante kostenstijging van 16 procent voor 2005. De overheid heeft de tarieven getoetst op kostengerelateerdheid en aan voorgestelde wetgeving in het kader van de privatisering van de luchthaven Schiphol. De BARIN ziet hierin haar bezwaren bevestigd dat de voorgestelde wetgeving de luchthaven onvoldoende richtlijnen tot kostenbeheersing/verlaging oplegt. Ook willen de luchtvaartmaatschappijen meer inzicht en zeggenschap ten aanzien de effectiviteit en efficiency van de bestedingen.

Uit onderzoek van het Ministerie van Verkeer & Waterstaat is gebleken dat de opbrengsten van Schiphol uit havengelden tussen 1999 en 2003 met maar liefst 38 procent zijn gestegen; meer dan bij de belangrijkste concurrerende luchthavens.

Ook zijn de winsten van de luchthaven de afgelopen jaren sterk gestegen, waar de luchtvaartindustrie nog steeds zwaar verliesgevend is.

Andere partijen in de luchtvaartketen hebben zich de laatste jaren vooral gericht op beheersing van en besparing op kosten. De BARIN vindt dat de luchthaven dat ook moet doen, zodat tariefsstijgingen niet nodig hoeven te zijn.

Free translation in English:

AIRLINES START FORMAL APPEAL PROCEDURE AGAINST INCREASE OF AIRPORT CHARGES AT SCHIPHOL AIRPORT

Schiphol, January 28, 2005

At the annual New Year’s reception of BARIN at the Schiphol Hilton hotel, BARIN Chairman Coen Waasdorp announced that the airlines will formally protest against the announced increase of airport charges for 2005 at Schiphol Airport, and will start the appeal procedure with the Ministry of Transport.

BARIN, the trade association of all airlines operating at Schiphol, is very disappointed to learn through the newspapers that the Minister of Transport has approved the increase of airport charges for 2005.
Also IATA, the International Air Transport Association, representing almost all the airlines in the world, who informed the Minister with two separate letters of its support towards the BARIN view, shares this disappointment.

The Minister has, after the announcement, replied to the letter of BARIN dated December 6, 2004, in which BARIN again elucidated its objections and asked for intervention by the Minister. The Minister explains that the law only allows her to do a limited judicial review to evaluate the charge increase at Schiphol Airport. The approval procedure does not provide room for the Minister to abstain from submitting the proposal for charge increases for approval to the Crown. It is in this context that the Minister refused the BARIN request to discuss the 0% increase scenario.

The unilateral announcement of the charge increase for 2005 takes place in a situation where the formal appeal procedures against charge increases in the past years have not yet been finalised.
In the opinion of BARIN no justice is done to a proper and meticulous consultation process of the airport with its customers, the airlines.

The monopolist Schiphol Airport has again unilaterally increased the charges with the blessing of the central Government, which is also the largest shareholder. Schiphol is basing the announced increase on the exorbitant cost increase of 16% for 2005. The Government has made a check on both the cost relatedness of the proposed charges and the proposed legislation related to the privatisation of Schiphol Airport. This confirms the objection of BARIN against the proposed legislation, which lacks any guidance for cost effectiveness and cost reduction. Moreover the airlines insist in obtaining a better insight in and control over the effectiveness and efficiency of the investments and expenses of the airport.

Research by the Minister of Transport has shown that the revenues from airport charges at Schiphol increased with 38% between 1999 and 2003; this is far more than at any other competing airport.
Furthermore the profits of the airport increased strongly in the past years, while the aviation industry is still making heavy losses.

In the past years other parties in the value chain have heavily focused on cost control and cost reductions. BARIN is of the opinion that the airport should do so as well, in order to prevent further charge increases.

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