Airlines Blast European Leaders' 'Lack Of Leadership'

European airlines are criticizing their governments for what they term "a lack of leadership" in managing airspace restrictions due to volcanic ash. The crisis cost the industry an estimated $200 million a day. An airline trade group said it was "incredible" that Europe's transport ministers had taken five days to organize a teleconference.

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MELISSA BLOCK, host:

This is ALL THINGS CONSIDERED from NPR News. Im Melissa Block.

ROBERT SIEGEL, host:

And Im Robert Siegel.

Today, some relief for travelers stranded in Europe. Large areas of the skies opened to air travel this morning. Flights took off in Italy, the Netherlands, France and Germany. Britain's airspace remained closed for most of the day because of the ash cloud from Iceland's volcano. But late in the day, authorities announced that U.K. airports, including London's Heathrow, would open this evening and airlines could schedule flights.

NPR's John Ydstie looks at the wallop the volcano has delivered to the airline industry.

JOHN YDSTIE: The Eurocontrol air traffic agency in Brussels said it expected about half of the normally scheduled flights would take off in Europe today.

Brian Flynn is Eurocontrol's spokesman.

Mr. BRIAN FLYNN (Head of Operations, Eurocontrol): The situation today is that we about 75 percent of the landmass area in Europe which has open. So the outlook is optimistic that bit by bit, hopefully in a few days time, the situation be restored to the normal movement of air passengers in Europe.

YDSTIE: But the situation isnt improving fast enough to satisfy the struggling airline industry. Giovanni Bisignani, head of the International Air Transport Association, yesterday criticized European officials for not acting faster.

Mr. GIOVANNI BISIGNANI (Director General/CEO, International Air Transport Association): We've lost in revenues roughly 200, $250 million a day. We have 700,000 passengers stranded and it took five days to arrange a conference call?

YDSTIE: To date, the losses suffered by the airlines is in excess of a billion and half dollars.

Mr. JOHN STRICKLAND (Director, JLS Consulting, Ltd.): I think it could be a matter of weeks, certainly within the following months that we could see airline failures.

YDSTIE: That's John Strickland, an aviation consultant in London. He says this event has been more devastating to airlines than the three-day shutdown of U.S. airspace after 9/11. Even if things were to improve quickly, he says, it's likely one or more airlines will fail, though likely not one of the big European carriers.

Mr. STRICKLAND: British Airways, EasyJet and, indeed, RyanAir are airlines who do have fortunately strong cash reserves. So, of course, they would prefer not to be burning them up to deal with this kind of eventuality. But not all airlines are so well placed.

YDSTIE: Strickland declined to name names, but said a failure could come at either end of the industry from a no frills carrier to a full service one.

British Airways, which says it's losing more $20 million a day, has suggested a government bailout of the industry may be necessary. But Michael O'Leary, the outspoken CEO of the low-cost carrier RyanAir is skeptical.

Mr. MICHAEL O'LEARY (CEO, RyanAir): Im always nervous when airlines are looking for compensation. It's usually a bad sign.

YDSTIE: O'Leary says a bailout could just keep weak airlines, who might have failed without this crisis, in business.

Mr. O'LEARY: You know, it could be the same airlines who were losing money before the volcano will now be looking for compensation, not for the volcano but for their losses.

YDSTIE: But O'Leary does think airlines should be relieved of the huge expense of paying to feed and lodge hundreds of thousands of stranded passengers, as is required by European Union law.

Mr. O'LEARY: We're definitely calling for the suspension of these ludicrous passenger compensation rules, which entitle passengers - even those paying 20 and 30 euro airfares - to seek reimbursement of their hotel expenses from airlines.

YDSTIE: Aviation consultant John Strickland agrees that would be appropriate.

Mr. STRICKLAND: This is really a natural disaster now and this is a point the airlines want to make. Airlines cannot be held responsible when they're at breaking point financially, in many cases, for this kind of level of natural disaster.

YDSTIE: Still, says Strickland, the failure of a few airlines would not necessarily be a bad thing for the industry, which has too much capacity. So the volcanic eruptions may, in a bizarre way, hasten the industrys adjustment to a more rational size.

John Ydstie, NPR News, London.

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