“Air traffic is something that will always exist”

“Air traffic is something that will always exist”

This interview with Günther Ofner, CFO of Vienna Airport (Flughafen Wien AG), should have been all about excellent figures and future targets. But everything has changed now…

The year 2020 started really well; Vienna Airport recorded great figures. 2019 had mainly seen a strong growth in passengers: The Vienna Airport Group (including the airports Kosice and Malta), served 39.5 million passengers (+15 percent). The airport in Vienna itself surpassed the old record of 2018 with 31.7 million travellers (+17.1 percent). The Vienna Airport Group expected a slowdown in 2020 but remained optimistic, believing in a passenger growth of three to four percent and increases in turnover, EBITDA and the net result. For the airport in Vienna, a passenger growth of three to five percent was projected. This had resulted in no further slots being available at peak times from 2020 onwards, which in turn would have allowed only for limited further growth. But then the Covid crisis took hold and everything changed…

Terminals, usually full of travellers, remained deserted all over the world. Entire airline fleets stayed on the ground. A horror scenario for any airport. With this backdrop, we met Günter Ofner, CFO of the Vienna Airport Group, for an interview.

The Covid crisis has hit the aviation industry badly. How is Vienna Airport dealing with this situation? The Covid crisis had a massive effect on global aviation and therefore also the airport in Vienna. The rise in infections and travel restrictions in various countries led to a significant reduction in travel; airlines reduced their schedules drastically. In the first few months of the crisis air traffic at the Vienna Airport came almost completely to a halt. Since mid-June 2020 we have seen a slight increase in passenger numbers but overall, we are clearly behind last year’s levels. Vienna Airport’s staff is on a short-time work scheme and major investments have been pushed back. The new Office Park 4 and the renovation of Terminal 2 will be finished though.

The global dimension of the Covid crisis is unique in the history of aviation. Almost every country in the world has recorded infections, which results in national travel restrictions and less travelling. But the coronavirus will stay with us for a while and therefore we need uniform travel regulations, in particular for entry into the European Union, in order to revive international business and holiday trips. Without functioning international air travel, the crisis will take hold longer. This does not only apply to tourism and conferences but also to large parts of the economy and the industry. If an economy that depends so strongly on exports as Austria’s is not present on the international markets, there won’t be any new orders and thus no work in future.

Photo: Flughafen Wien AG

Vienna Airport: At the moment the idea is to remain a hub between East and West but the future of global air travel remains unclear.

At Vienna Airport we have tackled the current situation and took a number of measures to protect travellers and staff. It is compulsory to wear a mask at the terminals and to keep a minimum distance. All check-in, information and service desks have been equipped with Plexiglas, there are numerous disinfectant dispensers and all passengers can take a PCR test right at the airport. This offer made Vienna Airport a global trailblazer.

How will the Covid crisis change air travel? The crisis actually showed that nothing works without aviation Functioning air traffic is essential for a country’s security of supply. At the height of the Covid crisis, every day aeroplanes with medical supplies such as masks, protective clothing and gloves arrived at Vienna Airport. No other mode of transport is able to move such large amounts of urgently needed goods from one place to another in such a short amount of time.

Therefore, air traffic is something that will always exist. And even if it will take a little longer, it will grow more than ever before. Plant manufacturers won’t sell their power plants via video calls and 80 percent of the world’s population has never been on an aeroplane. An economy such as Austria’s, whose gross domestic product depends up to 60 percent on exports, needs good international traffic connections and tourism will continue to grow just like it did before the crisis. The regions around the airport, particularly in Eastern Europe, are growing fast and will ensure further business for Vienna as a “local” airport.

What does this mean in terms of logistics? In order to safeguard the security of supply for Austria, Vienna Airport has been continuously in operation during the entire Covid crisis. Every day, cargo planes and planes of Austrian Airlines brought in urgently needed medical supplies to Vienna that were

needed at hospitals and relief organisations. Our apron teams have been working hard around the clock to ensure that these goods could be forwarded quickly.

Quick processes, efficient cargo handling and a good cooperation with the authorities ensure efficient cargo clearance. The cargo volume is currently below last year’s level due to the crisis but in the long run air cargo will be back – and we are ready: Our Pharma Handling Center ensures quick handling of temperature-sensitive goods without interrupting the cold chain and our Air Cargo Center offers enough capacity for efficient cargo handling.

Are they in demand? Many companies like these advantages: DHL built a logistics campus close to the airport, Kühne & Nagel moved its headquarters to the Airport City right at the airport and with Makita and Cargo Partner a Japanese toolmaker and a logistics partner settled next to the airport. The advantages of having a business site at Vienna Airport are obvious. Logistics companies are connected directly to the important modes of transport, air, road and railways. They benefit from the airport organisation’s high level of service and the Airport City offers shops, health care and social facilities such as a kindergarten, a gym, a health care centre, hotels and restaurants.

Speaking of which – how is the Airport City doing? The Airport City has become a modern and multi-functional site over the years; a number of companies have settled there. We recently added the Office Park 4 with 26,000 square metres of office and conference space, offering a completely new and state-of-theart working environment. It is located right at the centre of the Airport City and offers the perfect working environment for small and large businesses, from start-ups to international headquarters. There are co-working spaces, state-of-the-art event and conference areas, a kindergarten and modern office spaces available. A new footbridge connects the Office Park 4 with Carpark 3 and the terminal building. Austria’s largest LED advertising space is attached to the bridge, clearly visible to anyone coming to the airport. Companies such as Huawei and Magenta already use this 180 sqm big screen for their adverts.

How dependent is Vienna Airport on the good state and even the existence of Austrian Airlines? Austrian Airlines is the largest airline at Vienna Airport, 50 percent of our passengers fly with Austria’s home carrier. The airline is operating a hub in Vienna, meaning that it transports passengers from other countries all around the world. Thanks to this, a number of cities and regions can by visited by plane from Vienna which otherwise would have no connection by air. Long-haul traffic in particular needs such feeder flights to ensure flying at full capacity. Without short-haul flights there would be no long-haul flights. And Austria’s entire economy and tourism sector would suffer without them. Companies need the direct access to their markets, the export economy needs efficient international flight connections and the Austrian tourism sector profits from travellers that come both from Europe or via intercontinental flights. About 26,000 people in 230 businesses work at Vienna Airport. Overall, air travel safeguards 80,000 jobs in Austria. Austrian Airlines and all other airlines, their staff and their networks are both a direct and an indirect driver.

Investments by and at Vienna Airport

The first half of 2020 saw investments of 39.2 million euros and these were the largest: c Renovating the terminal: 12.5 mln euros c Footbridge to Carpark 3: 2 mln euros c Properties: 2 mln euros c Aircraft tugs: 1.3 mln euros c Passenger buses: 1.2 mln euros c Office Park 4: 1.2 mln euros c New advertising spaces: 1.1 mln euros c Airport Malta, an associated company abroad of Vienna

Airport Group: 5.5 mln euros total The planned investments for 2020 will be reduced to under 100 million euros according to Vienna Airport’s business report. Office Park 4 and Terminal 2 will be finished, all other building projects such as the expansion to the South and the renovation of Pier East have been postponed.

Are air traffic and climate protection a contradiction? No, because air traffic contributes only in part to global emissions and can help solve the problem with innovations. Air traffic is only responsible for about two percent of CO2 emissions globally, for 0.52

percent in Europe and only 0.16 percent in Austria. The entire sector is aware of its responsibilities and is the only sector in the world that has committed to international climate and reduction targets. The programme Corsia, for example, aims for CO2-neutral growth from 2020 onwards, the CO2 emissions need to be reduced by 50 percent by 2050 and the aviation sector is compensating for its CO2 emissions by buying certificates. Vienna Airport has already achieved much in this regard: CO2 emissions went down by 70 percent and the energy consumption by 40 percent since 2012.

The new Office Park 4 is Austria’s most sustainable office building. There are seven solar power systems with about 16,000 sqm of solar panels at the airport. The airport’s car pool keeps switching to electric vehicles. Energy-efficient LED technology is used for numerous lighting systems and we are working on several other environment-friendly measures. The largest potential for the reduction of CO2 emissions come from alternative fuels. These fuels only emit as much CO2 as was needed for their production. There is a lot of research on this and Europe could become a trailblazer in this field. A common European airspace, the so-called Single European Sky, could contribute significantly to reducing CO2 emissions as flight routes would become shorter and thus fuel consumptions goes down. ◆