Ryanair wants 24 more TAP slots
Ryanair, the Portuguese charter airline euroAtlantic Airways, and the Porto Commercial Association all tried to get the European Directorate-General of Competition to reject TAP’s restructuring plan.
In particular Ryanair contested the idea that the services supplied by the Portuguese carrier could not easily be replaced by other companies, including flights to the regions of the Azores and Madeira.
Both Ryanair and the Porto Trade Association also rejected the idea that if Lisbon airport ceased to be a hub it would be unable to offer international links to the main destinations currently served.
The European Commission received opinions from 39 entities on Portuguese State aid to TAP, almost all of them favourable to the airline and government.
TAP’s restructuring process which was ordered by Brussels involved a thorough investigation opened on 16 July 2021.
Part of this investigation involved canvassing the opinions of interested parties before a deadline of 6 September 2021. Thirty-nine entities sent in opinions regarding Portuguese State financial support for TAP and both parties managed to garner substantial support for their cause.
“All of the interested parties, except two competitors, supported the capital injection as part of the restructuring and attested to the important role performed by TAP in connecting Portugal to the European Union, and other regions of the world, as well as its importance for Portugal’s economy”, states the report which accompanied Brussel’s decision to give the Portuguese government the green light to invest a total of €3.2Bn in the airline.
Ryanair, which had submitted its own report on air transport in the main European markets, concluded that low-cost airlines represented 44.3% of the increase in seats offered in Portugal between 2014 and 2019, while the other international companies contributed 29.3%, and TAP and Portugal just 26.4%.
Contesting the need for and amount of financial support from the State to TAP which totals €3.2Bn, the low-cost airline led by Michael O’Leary suggested measures to limit market distortion caused by unfair competition should Brussels give the go-ahead, as it in fact subsequently did.
Ryanair argued that the massive amount of State aid (to TAP) and insufficient levels of own capital contribution justified that a divestment in slots should be much greater than Lufthansa (24 slots per day). The final decision was that TAP would abdicate 18 slots.