Brexit: turbulence ahead from Autumn 2018 for airline sector
Wednesday, 12 July 2017
Several EU airline sector market players raised the alarm on Tuesday with the European Parliament. They argued that their post-Brexit fate should be dealt with no later than Autumn 2018, at the risk of interruption to traffic, including the United States.
“The deadline date for airline companies is not March 2019. This is, of course, the intended date for the end of negotiations upon the divorce between the EU and the United Kingdom. Airline companies argue that their cut-off date should be September-October 2018. The CEO of the Irish company, RyanAir, Michael O’Leary, known for his derogatory comments, said, “We are starting to cancel flights six months in advance.”
Unlike other sectors such as the automobile or pharmaceutical industry, aviation cannot fall back upon the World Trade Organization (WTO) rules. These would apply to other industries if Brexit results in an absence of agreement on the terms of the divorce or the transition period.
The United Kingdom, as a member of the EU, is part of the single aviation market. The boss of RyanAir, who boasts leading the “Number one European Airline”, repeated his concerns before MEPs from the European Parliament Transport Committee meeting in Brussels. He raised the threat that without a proper agreement upon Brexit, all flights between the United Kingdom and the rest of the EU may be interrupted.
On Tuesday, his colleague Sean Kennedy, the Vice-President of Airlines for America, the parent company for United, American, Fedex and UPS, indicated that this may also be the case with transatlantic flights.
Those attending the debate stressed that as airports need to prepare themselves for Brexit and as airlines organise their flight schedules a year in advance, the sector is not able to wait for March 31st, 2019.