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Langen, 7 April 2004

Germany's Air Transport Initiative presents first results

First savings potentials in double-digit millions identified
Don't talk, act quickly – that was the motto adopted by the initiators of the German Air Transport Initiative in summer 2003. Nine months after the start of the initiative, Wilhelm Bender (Chairman of the Executive Board of Fraport AG), Dieter Kaden (Chairman and CEO of DFS Deutsche Flugsicherung GmbH), Michael Kerkloh (Chairman of the Management of Munich Airport GmbH) and Wolfgang Mayrhuber (Chairman and CEO of Deutsche Lufthansa AG) presented the first results in Berlin on 7 April 2004.

“We must produce faster, more cost effectively and efficiently in order to maintain and improve our competitive position in European air transport. Only an internationally competitive air transport location is a strong partner for the German economy”, said Lufthansa chief Wolfgang Mayrhuber, on behalf of the companies involved. “Quality, price and time are decisive for the success of German products on international markets. Only air transport guarantees a seamless chain between producers and buyers.”

Mayrhuber described it as a measurable success that in the joint analysis of the ground processes at Frankfurt Airport alone, "savings potentials had been identified amounting to double-digit millions". Together with Wilhelm Bender, Michael Kerkloh and Dieter Kaden, he emphasised the spirit of the initiative: “We are all sitting in the same boat. The focus is on our common interests. We want a strong German position in European and international competition. Regional and institutional parochial thinking no longer has a place in the global competition of the 21st century." At the same time, Mayrhuber thanked the patrons of the initiative, Federal Minister of Transport Manfred Stolpe, and the representatives of the federal and regional governments, for the close cooperation in the development of possible solutions to questions of sovereignty.
Air transport is and will remain a "job machine". The initiators are agreed on that. While personnel was considerably reduced in almost all sectors of industry and by almost all transport providers between 1995 and 2001, employment in the air transport sector has grown counter to the trend. An increase of 16 per cent in employment in the civil aviation industry, for example, compared with cuts in the workforce of 30 per cent by German Railways (Deutsche Bahn).

This “generator of jobs” is threatening to falter as a result of recent cost increases, not least due to legal regulations. In this connection, the German air transport market today already sees itself confronted with major competitive disadvantages amounting to billions in comparison with other European air transport markets or transport service providers:
• Only in Germany is the full VAT rate levied on national flights. Everywhere else in the EU reduced rates or complete exemption from VAT applies; the only exception is the Netherlands where there is practically no domestic air transport. The additional burden on German air transport in the competition-relevant European comparison amounts to at least € 170 million.
• European competitors are supported with considerable government grants, infrastructure subsidies and equity capital increases: between the start and the middle of the nineties with almost €15 billion - without however, the objectives of the subsidies being achieved. Extensive financial assistance is also granted to airports abroad. For example, countries like the Netherlands or France finance the intermodal connections to their airports, whereas in Frankfurt or Munich, the airport and, via their fees, ultimately the airlines, bear a large share of the costs.
• The aviation security fees, in particular, at the German hubs are among the highest in Europe. That will also not be changed by the recent decision of the Federal Administrative Court which provides for an abolition of the aviation security fee II.
• The safety and security costs in air traffic are predominantly borne by the airlines, whereas in rail traffic, for example, they are largely covered by public financing.
• Air transport covers 100 per cent of its infrastructure costs by fees and other charges. In contrast, German Railways (Deutsche Bahn), even when adding up the taxes and fees it pays, is only able to, cover about 60% of its infrastructure costs.

Against the background of this analysis there is an urgent need for action. In the last nine months, the initiators have achieved the first positive results, on which the further work in the coming months can be based:
• In Frankfurt all activities have been investigated, from the "pushback" of the aircraft at the terminal right through to take-off. All companies involved have subjected existing structures and the current division of tasks to close scrutiny in order to achieve process improvements which are in the interest of all companies involved. Initial results indicate savings potential in Frankfurt alone amounting to double-digit millions. The investigation will be extended to terminal processes and applied to other airports in order to identify further savings potential through process optimisation.
• With the German Act of Acceleration of Traffic Infrastructure Planning, important steps have been taken, initially in the new federal states and soon afterwards in the entire Federal Republic, towards the general acceleration of approval procedures, which were of particular benefit to road and railroad traffic, but also to the extension of Leipzig Airport. The initiators are demanding faster planning processes and the removal of bureaucratic obstacles. To this end, experts in the civil aviation industry and from the federal and regional ministries concerned have prepared packages of measures, in particular, aimed at traffic optimisation in connection with major projects like the construction of terminals and runways. Delays like those in Frankfurt, which lead to a planning and construction phase of almost ten years, are unacceptable in international competition. They weaken the position of Germany and, in the long run, destroy modern and future-oriented jobs at the airports and in the surrounding areas.
• The initiators have committed themselves in a "Code of Conduct" to a clear set of rules for behaviour aimed at the avoidance of subsidies. Already existing and undisputed competitive disadvantages for the German civil aviation industry compared to its European rivals and other transport providers like the railways in Germany would be intensified to such an extent as a result of a tax on kerosine or a sales tax on cross-border traffic that Germany's position in the air transport industry would be endangered. The initiators are vigorously demanding that a stop be put to all initiatives which threaten the location. With this position paper including the “Code of Conduct”, the German civil aviation industry takes up a position which is uniquely clear and consistent in Europe, or even worldwide.
• The initiators commit themselves, in particular, to the existing high safety standards as a prerequisite for sustainable air transport in Germany. In order to avoid competitive disadvantages, however, processes are necessary which are as efficient as possible and which are guaranteed by a close cooperation between the authorities and the civil aviation industry. To this end, together with the ministries involved, the Air Transport Initiative has worked out specific recommendations for action.
• The initiators are in agreement that the corporatisation of DFS, ten years after its foundation, must be further developed for it to assert itself against the European competition in future.

The initiators want to continue to develop their objectives and time schedule at same pace in order to exploit identified potential with actual measures. With more than 750,000 employees in Germany, the civil aviation industry can continue to make a considerable contribution to Germany's position as a major location for trade and industry. Mayrhuber pointed out that the range of jobs extends from service to research and development. The positive side effects of airports alone clearly confirm the dynamism in the industry: "One job at the airport secures two further jobs outside the airport. This position can only be maintained in international competition if we act faster and with more foresight with respect to the infrastructure, become more cost-effective and consistently prevent distortions of competition.”


DFS Deutsche Flugsicherung GmbH is a State-owned company under private law and has 5,200 employees. DFS ensures the safe and punctual handling of flights. Staff coordinate around 10,000 aircraft movements in German airspace every day, and more than three million movements every year. With this large number of flights, Germany has the highest traffic volume in Europe. DFS operates control centres in Langen, Bremen, Karlsruhe and Munich. In addition, DFS is represented in the Eurocontrol Centre in Maastricht, the Netherlands, and in the control towers of the 16 international German airports. DFS provides training and consultancy services around the world and develops and sells air traffic control, surveillance and navigation systems. The company's portfolio also comprises flight-relevant data, aeronautical publications and aeronautical information services. DFS has the following business units: Control Centre, Tower, Aeronautical Solutions and Aeronautical Information Management.


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16/01/2009