Airlines lose $1.7 billion, ask for compensation; Germany lifts all airspace restrictions

By Matt Moore, AP
Wednesday, April 21, 2010

Airlines lose $1.7 billion, Germany opens airspace

BERLIN — Airlines lost at least $1.7 billion during the volcanic ash crisis, the industry said Wednesday as air controllers lifted all restrictions on German airspace, paving the way for more flights into some of Europe’s busiest airports.

Giovanni Bisignani, the head of the International Air Transport Association, called the economic fallout from the six-day travel shutdown “devastating” and urged European governments to examine ways to compensate airlines for lost revenues, as the U.S. government did following the Sept. 11, 2001 terror attacks.

He said it would take three years for the industry to recover from the week of lost flying time that stranded millions around the globe.

Spain, meanwhile, has developed into a key emergency travel hub, arranging for hundreds of special flights to move over 40,000 people stranded by the travel disruptions. Its airports and airspace have mostly remained open throughout the crisis.

German aviation agency Deutsche Flugsicherung said the improved weather situation allowed it to completely reopen the country’s airspace and insisted the decision was made based on data, not economics. It said the concentration of volcano ash in the sky “considerably decreased and will continue to dwindle because of the weather conditions.”

“Bremen, Hamburg, Hannover, Berlin, Frankfurt and Munich are open again,” said Axel Raab, a spokesman for German air traffic control.

“We cannot say what it will look like in the next few days. If the volcano becomes active again, new closures might happen,” he said. “This is now a decision that was made based on meteorological data.”

A report from a test flight carried out by the German Aerospace Center said that differing levels of ash were found at different locations over Germany, with the airspace above the northern city of Hamburg being entirely free from ash.

The highest concentration of volcanic ash was found over eastern Germany, but the report said its density was comparable to a plume of dust above the Saharan desert.

The center reported no damage to the airplane that flew the test flight. A French weather service plane took samples of the air Tuesday and found no volcanic ash problems either, according to French transport minister Dominique Bussereau

Passengers, many of whom were stranded for days, welcomed the German news.

“It’s good for us at least,” Mats Tillander, a Swede at Frankfurt International Airport, who spent four days trapped in Texas, told AP Television News.

He discounted bickering between airlines and governments as to whether the airspace closings across Europe were a case of overkill.

“I don’t know what’s right and wrong,” he said.

Airlines lost $400 million each day during the first three days of grounding, Bisignani told a news conference Wednesday in Berlin. At one stage, 29 percent of global aviation and 1.2 million passengers a day were affected by the airspace closure ordered by European governments, who feared the risk that volcanic ash could pose to airplanes.

“For an industry that lost $9.4 billion last year and was forecast to lose a further $2.8 billion in 2010, this crisis is devastating,” Bisignani said. “Governments should help carriers recover the cost of this disruption.”

He noted that the scale of the crisis eclipsed the events of Sept. 11, when U.S. airspace was closed for three days.

Flights resumed in many areas, but the situation was anything but normal as airlines worked through an enormous backlog after canceling over 95,000 flights in the last week.

Air traffic control agency Eurocontrol said it expected at least 15,000 of the continent’s 28,000 flights to go ahead Wednesday across Europe, and possibly much more.

But severe delays are still expected across Europe, as airlines pressed to patch together normal flights with airplanes and crews scattered all over the globe.Some restrictions remained Wednesday morning over parts of Britain, Ireland and France, as well as over parts of central Europe.

At Heathrow’s Terminal 3 outside of London — home to many airlines including Virgin Atlantic and Air Canada — no one was allowed inside the departures level until they had been checked by their airline to ensure they had a valid ticket. The departure boards still showed about half the flights as canceled.

Despite the uncertainty, passengers were optimistic that they would soon be moving. Juanjo Dominguez, a 25-year-old web designer from London, was at the airport for his afternoon flight to New York.

“I feel good, hopeful,” Dominguez said. “I still think that things can happen from now … I am still keeping my fingers crossed.”

At the terminal’s arrivals level, there was just a small trickle of passengers arriving from New York and Madrid.

In Spain, the airport in Barcelona — near the border with France and thus a gateway to the rest of Europe — has been a key emergency hub, taking in flights from New York, Orlando, Vancouver, Paris, Nice and Rome.

Airports in Barcelona and Madrid also chartered nearly 300 buses to get people to other cities in Europe, and Palma on the Mediterranean island of Mallorca handled 50 extra flights.

Bussereau predicted air traffic will be back to normal before the weekend as aviation authorities expanded the corridors where planes are allowed to fly. He estimated all of Air France’s long-distance flights to and from France would fly Wednesday, and 60 to 70 percent of its mid-range flights.

The airspace over the Baltic states — Lithuania, Estonia and Latvia — and all the region’s major airports opened up Wednesday.

Ryanair announced it will be resuming a “substantial proportion” of its normal services in northern Europe earlier than expected, effective as of 5 a.m. (0400GMT, midnight EDT) Thursday.

Services to Ireland and Britain are also schedule to resume eight hours earlier than previously announced, starting Friday 5 a.m.

Ryanair’s chief executive Michael O’Leary warned, however, that capacity limitations will give rise to considerable air-traffic-control and airport delays over the next few days, as all airlines struggle to clear the backlog of disrupted passengers.”

Deutsche Lufthansa AG’s chief executive on Wednesday welcomed the government agency’s decision to reopen the skies.

The quantity of ash from Iceland’s volcano in German airspace is so low that there’s “absolutely no danger,” Wolfgang Mayrhuber told broadcaster ARD. “We will restart our system as quickly as possible.”

Lufthansa, Germany’s biggest airline, planned to operate some 500 flights on Wednesday, compared with 1,800 on a normal day.

Mayrhuber reiterated his criticism on how the flight disruptions were handled, shutting down wide swaths of Europe’s airspace based on what he called were forecasts of questionable reliability.

“From the beginning, we had the suspicion that the forecasting model could not be all right,” Mayrhuber said.

However, he said his company would not seek government compensation.

“We don’t need a bailout, we don’t need an umbrella,” he said, declining to say how the shutdown would affect Lufthansa’s bottom line.

“We’ll compile those costs and will deliver that later,” Mayrhuber told reporters. “But it’s not marginal.”

In Iceland, there was no sign that the eruption at the Eyjafjallajokull (ay-yah-FYAH-lah-yer-kuhl) volcano was ending soon, according to Pall Einarsson, a geophysicist at the Institute of Earth Sciences in Reykjavik.

“We cannot predict when it will end,” he said Wednesday. “(But) ash production is going down and is really insignificant at the moment.”

Lufthansa is Europe’s largest airline group by sales. It owns or holds stakes in carriers including Swiss International Airlines, Austrian Airlines and British Midland.

Associated Press Writers Slobodan Lekic in Brussels, Angela Charlton in Paris, Frank Jordans in Geneva, Jennifer Quinn and Sylvia Hui in London and Carlo Piovano in Reykjavik, Iceland contributed to this report.

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