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Deloitte comments on the European Commission’s recent proposal regarding the sale of landing/take-off slots at airports

8 November 2012

Graham Pickett, head of travel, hospitality and leisure at Deloitte, said: “The European Commission’s proposal regarding the buying and selling of landing slots aims to alleviate congestion at European airports. While it may not solve the capacity problem entirely, it will ease the burden until longer term solutions around infrastructure are agreed. In the absence of additional capacity, slot prices will increase and lead to higher ticket prices, potentially hitting tourism and wider economic growth.

“The current, web-based trading system in the UK gives a proper platform in terms of supply and demand, but trades have historically only covered Heathrow and Gatwick.  In addition, the system does not include fundamental pricing information so the market is not truly transparent. The European Commission is proposing to allow such trading systems across Europe and is debating requiring at least some disclosure about the prices at which slots are traded.

“British airlines are already used to thinking about their landing slots as strategic assets.  With the new proposals from the European Commission other airlines across Europe will also be starting to assess their strategies for their slot portfolios at major airports.

“Since accounting rules do not require airlines to measure slots on their balance sheet, or disclose the value of their landing slot portfolios, shareholders may not be aware of the significant value these may have. They may be looking to airlines to explain how they intend to use the new options open to them to maximise the return from these valuable assets.”

Ends

Notes to editors:
About Deloitte
In this press release references to Deloitte are references to Deloitte LLP, which is among the country's leading professional services firms.

Deloitte LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu Limited (“DTTL”), a UK private company limited by guarantee, whose member firms are legally separate and independent entities. Please see www.deloitte.co.uk/about for a detailed description of the legal structure of DTTL and its member firms.

The information contained in this press release is correct at the time of going to press.

Member of Deloitte Touche Tohmatsu Limited.

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