EU transport commissioner defends state aid to airlines

European Commissioner for transport Henrik Hololei has defended the level of state aid to airlines in the EU and forecast there will be more to come.

Hololei, EC director general for mobility and transport, said: “There is a very grave situation. There is no other option [than state aid].”

Lufthansa has secured loans and credit guarantees worth €9 billion in Germany through the German economic support fund, the WSF.

Air France secured €7 billion from the French state and sister carrier KLM €4 billion from the Dutch government.

Lufthansa Group airlines Swiss, Austrian Airlines and Brussels Airlines have also secured loans and credit guarantees from their respective governments – Swiss receiving €1.4 billion, Austrian €600 million and Brussels €290 million.

Spanish carriers Iberia and Vueling, part of the IAG group alongside British Airways, benefited from a €1 billion financial aid package in Spain

And in the UK, BA secured a five-year, £2 billion loan from a syndicate of banks backed by a government guarantee at the start of this year and easyJet secured a five-year loan of £1.4 billion also supported by a government guarantee.

Speaking on CAPA Centre for Aviation webinar, Hololei said: “We saw the same after 9/11. This time the situation is much worse and is much longer. It is not possible for this industry to come out of this without state aid.

“We cannot see this industry disappear. I would not be surprised if more state aid has to be given this year.”

He added: “In the situation we are in, most carriers across the world have been receiving start support.”

Hololei declined to comment on why some airlines had received aid while others had been declined. He said: “It is up to governments.”

But he insisted: “When there is state aid, there are rules. There have to be rules and a framework.”

Hololei warned against excessive optimism about the extent of recovery in air travel this year. He said: “We have the vaccines, surely 2021 must be better. But who knows. Even a clairvoyant doesn’t know.

“The first months will be very challenging. Things are changing very slowly. It will take a long time to roll-out the vaccines.”

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