The suggestion to temporarily close Berlin’s Tegel Airport because of plummeting traffic turns out to be just that, a suggestion. The uproar it caused was real though, because in Berlin airports make emotions and tempers flare.
Right now the city has three of them for its 3.76 million residents and million of visitors: Tegel, Schönefeld and the still unfinished Berlin Brandenburg Airport (BER) right next to Schönefeld.
It’s the latter just outside the city limits that has been the butt of jokes for years: Why can’t Germany build one tiny airport? What about German engineering? Will BER ever really open at all?
Yet slowly but surely one hurdle after another is being mastered. Already last November, FBB, which is in charge of all three Berlin airport locations, announced that the new airport would be up and running October 31 of this year.
At the end of April, the local building authority in charge of the project gave a final approval to open. Now billions over budget and nine years and one day behind schedule, Terminal 1 looks set to open. In time both Tegel and Schönefeld are set to close — leaving Berlin with only one airport. Still it is set to be Germany’s third-biggest after Frankfurt and Munich.
The coronavirus conundrum
The year 2020 would seem like the worst time to open a new airport as the tourism industry is in tatters and planes are parked across the world. But it is this current lull in traffic and passenger numbers that makes the opening ever more likely.
Since March, Tegel and Schönefeld together have only been serving 1,500-2,500 passengers a day. That’s why there was talk of closing Tegel for two months to save money. These plans have now been shelved for the time being
BER is bigger and therefore better prepared to deal with distancing and hygiene rules than the other airports in Berlin. Though even it will run into limitations, especially at security checkpoints. Because of the new regulations, Berlin airports can currently expect to operate at about one-third capacity, according to daily Tagesspiegel.
These lower number insure that BER won’t have to have a “grand opening” where everything goes online at once. From October 31 it can open up in baby steps. As more flights and airlines come onboard they can slowly open up sections. This step-wise approach is a safe bet to slowly ramp up to full capacity, thus avoiding any glitches before they turn into bigger problems. Any teething problems would be lost in slow motion.
Better late than never. Berlin Brandenburg Airport is finally set to open 3,289 days after originally planned on October 31
No matter how long it takes Gerald Wissel, managing partner at AIRBORNE Consulting, thinks that the new airport is important for Berlin, its economy and its tourism industry. “Every direct connection has a direct impact on these industries. In order to ensure this in the future, the appropriate capacity and infrastructure must be available.”
Fewer frequent fliers?
Nevertheless, for years even before the coronavirus started spreading experts have been warning that BER’s planning is completely outdated. When it finally opens it will be too small for the capital’s projected passenger numbers. Airport authorities must have agreed, because a few years ago in response they revealed a five-phase “Masterplan 2040” that will continuously add onto the current structure. They have already starting building.
Besides a piecemeal of tiny additions, the plan calls for a second terminal. In all it should be able to handle 58 million passengers by 2040; it also means BER will be a construction site for decades. Now the coronavirus and its impact on the travel industry have changed all calculations.
Lufthansa planes parked at BER airport with nowhere to go
Normally Tegel and Schönefeld together serve 100,000 passengers a day. Since March that number has been down to 1,500-2,500. Though many airlines have announced they will ramp up flights by mid-June in time for summer holidays, it is a long way to full capacity.
“We can expect 10%-20% fewer passengers in the next three to five years compared with 2019. This inevitably leads to a decline in revenue. There is also the risk of a possible second coronavirus wave, the availability of a vaccine and a fundamental change in demand,” Wissel told DW.
A bumpy landing
The ups and downs of BER could fill volumes. Even before ground was broken in September 2006, lawsuits had held up the project for years. From the beginning the airport has been a combined project of Berlin, the surrounding state of Brandenburg and the German government. All have a say in how things are done. This unique ― and inexperienced ― constellation was a backup plan after the group declined all private contractors vying to manage the project. Politicians were in charge instead of large-scale project experts.
Afterward came hundreds of changes to the building that led to problem with the fire safety system, cables and things just fitting together. By 2018, the empty building was costing about €10 million a month in maintenance. A ghost train was driven through the empty station every workday to keep things in running order.
Yet what role will the new airport play internationally? All big European hubs have been established for decades: London, Amsterdam, Munich and Frankfurt. Up to now, aviation experts have given BER a secondary role in the global aviation market.
But it is not up to experts or airports; these decisions are in the airline’s hands. For Berlin that means Lufthansa, which already has five hubs within Europe.
“In this context I think it is questionable whether BER will be considered as a 6th hub,” said Wissel. Even within Germany he is not convinced: “BER is hardly relevant,” he concluded.
Engelbert Lütke Daldrup for his part sees the coronavirus crisis as an opportunity. He believes that airlines and routes will be reconfigured after the crisis, and that the classic hubs will be less important.
He see the future in “self-connecting” where passengers travel on two or more connecting flights, booked separately on different tickets. This system is risky for fliers though since they are responsible for missed connections or cancellations.
“Airports like BER with almost 40 million passengers will help customers in the future to fly with one airline to Berlin and with a second airline to North America or China,” said Lütke Daldrup in an interview with aviation website airliner.de. He wants to make transfers as easy as possible, with or without luggage, even when passengers switch airlines.
Despite all the planning, building and bid ideas about changing the aviation industry, big question marks hover over the entire travel industry. In Berlin, the famous mantra “If you build it, they will come” may have been true before COVID-19 overtook the world.
Now it is anyone’s guess what travelers will do and how many of them will take to the skies. But if Lütke Daldrup is to be believed, no matter how many people come to Berlin, they will soon be landing and taking off from Berlin Brandenburg Airport.
Germany is throwing Lufthansa a €9 billion ($9.6 billion) lifeline. The government bailout will give the state a 20% stake in the airline, which could rise to 25% plus one share in the event of a hostile takeover bid as Berlin says it seeks to protect thousands of jobs. Economy Minister Peter Altmaier insists there will be no meddling with corporate decisions.
The Czech Republic is seeking more control over flight group Smartwings, the parent company of Czech Airlines. Industry Minister Karel Havlicek said the government could even take over the group completely, but executives replied that no one had expressed any such desire for that to happen as they preferred a state-guaranteed credit line to see the company through the coronavirus crisis.
Portugal’s flag carrier TAP has asked for a state-backed loan to secure the survival of the company. Employees want more state control through direct financing, with Prime Minister Antonio Costa raising the possibility of nationalizing the carrier. TAP is already 50% owned by the state with a 45% stake held by Brazilian-US entrepreneur David Neeleman. TAP employees hold the remaining 5% in shares.
Indirect state aid has come to the rescue of Norwegian, Norway’s budget carrier that has completed a painful restructuring process and secured a credit guarantee from the government. Major lessor AerCap now holds a 15.9% stake after converting lease obligations into shares. BOC Aviation holds a vital 12.67% stake in Norwegian — and BOC is ultimately controlled by the state-owned Bank of China.
Earlier this month, Singapore Airlines announced its first-ever annual loss in its 48-year history after grounding most of its fleet due to the pandemic-caused lockdowns. The carrier is already majority-owned by the government investment and holding company Temasek, which holds well over 50% of voting stock. The government has always stressed its non-involvement in the management of the airline.
Of the government-owned airlines, the Gulf carriers Emirates, Etihad and Qatar have often raised eyebrows among rivals in many parts of the world. The latter have said the airlines in question aren’t really playing fair, saying their business model is to crowd out competing airlines at any (state) cost. Before the pandemic, the three carriers had grown disproportionately for years.
Aeroflot Group, which includes Russian flag carrier Aeroflot, Rossiya and Pobeda, is another case in point. It is 51.2% state-owned. But you don’t really have to look far to find more airlines in this category. Right now, there are roughly 150 state-owned carriers around the globe, according to Wikipedia. It’s not the rule, though, as there’s an impressive total of about 5,000 airlines globally.