Aer Lingus Heathrow Landing Slots

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PUBLISHED: 10:45, 26 January 2015 UPDATED: 10:50, 26 January 2015

  • IAG has offered €2.55 a share for Aer Lingus, valuing the firm at £1billion.
  • The owner of BA and Iberia is keen to expand in Heathrow even though the airport is nearly full already.
  • The three airlines would control 56% of landing slots between them.
  • But the deal could be scuppered by the Irish government or Ryanair
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The owner of British Airways today launched a £1billion takeover bid for Aer Lingus in an attempt to secure valuable take-off and landing slots at Heathrow Airport.
IAG, which currently owns BA and Iberia, has offered a deal worth €2.55 a share, or €1.36billion in total, to buy Ireland’s national airline.
The company is keen to secure more space at the UK’s biggest airport, which is almost full to capacity – meaning that landing slots are now worth millions of pounds.
But the deal could be scuppered by the Irish government, which may block the move for political reasons, or by Ryanair, whose combative boss Michael O’Leary has long been trying to buy Aer Lingus.

The company’s chief executive, Willie Walsh, was previously in charge at Aer Lingus before moving across the Irish Sea and joining BA.
As well as the potential for efficiency savings by bringing Aer Lingus into a larger group, IAG is keen to expand its grip on Heathrow, where it is already by far the largest operator.
BA controls more than half the landing slots at the airport, according to the latest available figures, and if it were combined with Aer Lingus and Iberia, IAG would have 56 per cent of all flights coming into and going out of Heathrow.

More than 100 MPs from across the political divide are urging ministers to review the allocation of take-off and landing slots at airports such as Heathrow. Also owns Aer Lingus and Spanish. 04:27 UTC Aer Lingus (EI, Dublin Int'l) has obtained slots at Manchester Int'l for unspecified long-haul routes and plans to base one A330 and three A321-200NX (LR) s out of the English airport, according to Airport Coordination Limited. The owner of British Airways today launched a £1billion takeover bid for Aer Lingus in an attempt to secure valuable take-off and landing slots at Heathrow Airport. IAG, which currently owns BA and Iberia, has offered a deal worth €2.55 a share, or €1.36billion in total, to buy Ireland’s national airline. Aer Lingus take-off and landing slots at Heathrow could be worth up to €100 million, according to industry sources. The valuation of an average 21 Aer Lingus slots at London's main airport will boost the fortunes of the national carrier, whose future investment strategy will be decided by minister for transport Seamus Brennan over the next. By acquiring Aer Lingus, IAG would gain more take-off and landing slots at Heathrow Airport - valued at around £30m per pair - allowing it to operate more flights.

f the three airlines joined forces, they would account for 51.6 per cent of passengers passing through the airport.
Because Heathrow is running at almost full capacity, the only ways for an airline to expand its offerings at the airport are to trade in landing slots – worth several millions of pounds each – or to buy up a rival.

Aer Lingus is currently the fourth busiest operator at the airport, behind BA, Lufthansa and Virgin Atlantic, running up to 22 flights a day between Heathrow and Dublin.
Heathrow could expand if a third runway is built, but the issue is politically controversial and no decision will be made on the matter until after the general election in May.
Analysts suggested today that the IAG bid was likely to be accepted – but the Irish government could still step in to veto any deal.

Aer Lingus is 25 per cent state-owned, despite the Irish government’s promise to privatise it fully as part of the EU bailout deal struck in 2010.

Politicians are keen to safeguard the airline’s 3,900 workers, most based in Dublin, as well as ensuring that there is no decrease in the number of flights between Ireland and London.

Deputy prime minister Joan Burton said yesterday:

What we will want to do as a government, and what’s absolutely important, is to protect these slots and the connections of direct flights in and out of Ireland.

The country’s opposition has called on the government to rule out any sale, while trade union IMPACT warned that a takeover would pose ‘significant risk’ to the Irish economy as a whole.

Another potential hurdle is Ryanair, Ireland’s budget short-haul carrier, which owns a 30 per cent stake in Aer Lingus following a series of unsuccessful attempts to buy the airline outright.

Chief executive Michael O’Leary, known for his outspoken manner and aggressive attitude towards his customers, said last week he was open to considering a bid for Ryanair’s stake.
Aer Lingus shares rose by 3.8 per cent this morning, peaking at €2.44, while shares in IAG were up by 3.5 per cent.

Irish carrier Aer Lingus (EI, Dublin Int'l) is seeking to enter the UK-US transatlantic market in the IATA summer season with flights from a new base at Manchester Int'l to New York JFK, Orlando Int'l, and Boston.

A new subsidiary, Aer Lingus (United Kingdom) (Belfast City), has been set up for this purpose and it expects to receive its Air Operator Certificate (AOC), operating license, and a route license from the UK Civil Aviation Authority around February 2021.

This is according to a joint application by Aer Lingus Limited (parent) and Aer Lingus (UK) to the US Department of Transportation. In terms of this, Aer Lingus (UK) has applied for a Foreign Operator's Permit to operate daily flights from Manchester to New York (JFK); daily summer flights and four flights per week in the winter to Orlando; and daily summer flights to Boston, a route that is currently unserved.

Two A330-300s, EI-EDY (msn 1025) and EI-ELA (msn 1106), will be used and, as such, will both be re-registered and placed on the UK registry. Two additional A321-200NXs, due to be delivered in February and March 2021 respectively, will also be registered in the UK for subsequent use.

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Aer Lingus (UK) has requested to operate the services under the “Aer Lingus” name and EI designator code. It has also requested authority to use the “BA” designator code of fellow IAG International Airlines Group (IAG) carrier British Airways (BA, London Heathrow) on the services, but says it is not seeking any codeshare at this stage. It says both Aer Lingus Limited and British Airways currently hold all necessary route authority required to market the services by Aer Lingus (UK).

It is intended that base maintenance support would be provided by Sabena Technics and Dublin Aerospace, and line maintenance support would be provided by British Airways and parent Aer Lingus Limited.

In support of the application, the applicants say that with the closure of Thomas Cook Airlines UK (MT, Manchester Int'l) in 2019, all nonstop routes from Manchester to the US are forecast to be served by only one operator in 2021, with 70% of the peak summer capacity anticipated to be operated by Virgin Atlantic (VS, London Heathrow).

The joint applicants have requested the DoT to expedite their application. “Given the extraordinary market conditions resulting from the COVID-19 pandemic, the ability to promote, advertise, and sell these services as quickly as possible could significantly contribute to the ultimate success of the competitive services proposed in this application,” the carriers said.

The Foreign Air Permit applied for covers foreign scheduled and charter air transportation of persons, property, and mail from points behind the territory of the UK, via the territory of the UK, and intermediate points to any point, or points in the territory of the US and beyond. It also covers foreign scheduled and charter cargo air transportation between any point or points in the US and beyond; other charter transportation pursuant to the prior approval; and transportation authorised by any additional route rights made available to UK carriers in the future.

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The applicants have applied for exemption authority for a two-year period or until the requested FOP becomes effective, whichever occurs first.

The UK and the US on November 17, 2020, signed a new Open Skies agreement (US-UK Agreement) ensuring that air transport between the countries continues seamlessly in a post-Brexit environment which kicks in on January 1, 2021. Air traffic between the countries had been covered under the US-European Union (EU) Open Skies regime, but the UK’s exit from the EU made a new agreement necessary.

Aer Lingus (UK) has also requested that the DOT waive a requirement of the US-UK Agreement, that substantial ownership and effective control of Aer Lingus (UK) be vested in nationals of the UK.

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Aer Lingus Limited, an Irish entity based at Dublin Airport, holds an EU operating license and will not be affected by the new US-UK Agreement. However, the Dublin-based parent, out of caution, has requested any additional exemption authority the DoT deems necessary for it to market UK-US flights operated by Aer Lingus (UK).

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About Aer Lingus

TypeScheduled Carrier
BaseDublin Int'l
Aircraft53
Destinations86
Routes108
Daily Flights46