Slot Rule Reform

Potential reforms to the existing slot regulations/rules broadly fall into three categories:

• To encourage better use of scarce airport capacity
• To increase airline competition and choice for passengers
• To see whether the slot system can be used to tackle other priorities such as sustainability

Best use of airport capacity

The slot rules cannot create more airport capacity, only manage the existing inadequate capacity as efficiently as possible. Attention has focused on the 80:20 rule. Some argue this level is too low and should be increased to ensure higher utilization of available slots.

However, the reality is that airlines prefer to use their entire slot holding if they can. Utilization rates at heavily congested airports are typically 95-98%, showing that utilization is already at its practical maximum at airports with high demand. Increasing the 80% rule would not increase utilization at peak times but may create other negative consequences in the system. 

Promoting competition and choice

Some observers believe that the dominant position of ‘home’ carriers at their major hub airports and the ‘grandfather’ rights to operate a slot the following year (if they meet the 80:20 rule) mean that opportunities for other airlines to operate slots at congested airports is limited, thus affecting consumer choice.

It’s important to remember that the slot rules have to keep a balance between allowing access to new entrants while ensuring that schedules remain stable and airlines have the certainty that they can invest in their routes year-on-year. In Europe, for example both routes and competition on routes has been increasing. If the slot rules were tilted dramatically in favor of new entrants, this delicate balance could be disturbed.

Using slots for other policy priorities

The air transport system affects every aspect of modern life and there are often competing visions for the role the industry should play in the economy and society. The slot system is vulnerable to being used to try and further policy aims in areas that are not connected to the core mission of the WASG. Examples of this include prioritizing local airport priorities, mandating the types of flight per slot and attempting to use slots to drive better environmental outcomes.

The industry view of these aims is that the slot system is already a finely tuned process, delicately balancing multiple competing aims of its core mission: to best manage scare airport capacity, ensuring stable global schedules and increasing access to new carriers. Adding further burdens to the slot rules risks damaging its successful management of these core objectives.