[European Commission] – Special report on the impact of Covid-19 on air navigation service provision in Europe and the US
As a result of the Covid-19 pandemic, air traffic in the US decreased by 33.5% in 2020, which corresponds to 5.3 million fewer flights, compared to 2019. In Europe, the number of flights decreased by 55.2% in 2020 and resulted in 6.1 million fewer flights compared to 2019.
The higher reduction in Europe appears to be linked to differences in terms of market composition and the varying national measures implemented by European States to fight the Covid-19 pandemic. The report shows that domestic traffic was less affected than international traffic on both sides of the Atlantic. However, the share of domestic traffic in the US (85.6%) is much higher than in Europe (28.4%) which contributed to a lower traffic reduction in the US.
At the same time, the high share of international traffic within Europe, but also to and from Europe, together with the different Covid-19 procedures in terms of quarantine and testing, seem to have contributed to the lower traffic levels in Europe. The EU Digital Covid Certificate is expected to simplify these procedures and contribute to the recovery of traffic within Europe.
The collapse in traffic in 2020 had a significant impact on revenues and on the ability of both the EU and US systems to finance their operations. In Europe, it is estimated that revenues in 2020 decreased by some 58% to around EUR 3.7bn (compared to some EUR 8.5bn in 2019). To mitigate the impact of the dramatic traffic reduction on their activity, but also to address potential cash shortages, a number of European Air Navigation Service Providers introduced measures, including the implementation of cost-containment initiatives, taking up loans to alleviate liquidity risks as well as, in some cases, receiving support from national governments.
In the US, the FAA derives the majority of its funding from the US Airport and Airway Trust Fund (AATF), which was impacted by the US Congress decision to impose an excise tax holiday period from March to December 2020. Following the resulting drop in aviation taxes and surcharges, the US Congress appropriated a USD 14 billion (EUR 12bn) transfer to the AATF in support of the FAA budget, of which the FAA/ATO is one part. As a result of the Covid-19 pandemic, the FAA/ATO reported cost savings related to travel expenses and overtime, but also some increases due to cleaning and custodial services.
Download: The special report on the impact of the Covid-19 pandemic on the US and European ANS systems
(English, 4.05 MB – PDF)