Air transport is facing many challenges such as increasing demand, larger airports, increased network congestion which need to be reconciled with environmental issues. Hence there is a need for smarter solutions at service, operational and technical levels. One of the important actors in the aviation supply chain are the Air Traffic Management (ATM) service providers.
Since 2004, the European Union has invested in research and development in the area of ATM. The main objective of the EU is to reform the European ATM system in order to cope with sustained air traffic growth under safe, cost-efficient and environmentally friendly conditions. The Single European Sky (SES) initiative aims to re-structure the European airspace as a function of air traffic flows, create additional capacity and increase the overall efficiency of the ATM system. The European Commission set ambitious goals to be achieved by 2020, including a 3-fold increase in airspace capacity and a cost reduction of at least 50% in the provision of ATM services.
However, today’s progress towards SES objectives is perceived as slow.
In this context, the question of how to provide the appropriate organizational structures, institutions and incentives for new operational concepts and technologies to yield the expected results stands high on the European policy agenda. The introduction of competition has been proposed as a means to provide incentives for the realization of the high-level objectives of the SES, by speeding up the innovation cycle and the fostering of more efficient operations. On the other hand, competition does not prevent every market failure (e.g. negative externalities) and, depending on market conditions, liberalization can also have undesired outcomes, such as the emergence of oligopolies or monopolies. Besides, competition does not exist abstractly and is influenced by the legal and regulatory framework. Hence, the successful introduction of competition requires a comprehensive impact analysis to evaluate different regulatory approaches along a variety of dimensions.
The overall goal of COMPAIR was to study various institutional and market design approaches for introducing competition for en-route ATM services, in order to assess their potential contribution to the European Single European Sky objectives. The project was also required to propose a vision for the implementation of the most desirable institutional structures.
After extensive qualitative research, four introduction scenarios were defined. These cover short, medium- and long-term options. All scenarios were quantitatively assessed using different approaches, in order to make a sound estimate of their feasibility.
The project results suggest that introducing some form of competitive elements would likely lead to:
• Increases in ANSP cost efficiency,
• Lower charges by up to half current levels,
• Increases in technology uptake, and
• Decreases in the fragmentation of the European skies.
