THE PROPOSED INTRODUCTION OF MARKET-BASED MECHANISMS 309 According to the Commission, “It has been estimated that by revising the current allocation system up to 24 million additional passengers would be accommodated each year at European airports meaning more than €5 billion in economic benefits and up to 62,000 jobs by 2025 thanks to a more resource efficient allocation system”. But are there competition problems arising from slot trading mechanisms? There certainly are. Slot trade is a multi-million market. In 2004, FlyBe sold six pairs of slots to and from London-Heathrow (LHR) for approximately £40 million; in 2007, British Airways bought 102 Heathrow slots for £30 million; and in 2008, Continental Airlines paid €143 million for four pairs. These figures shows beyond any reasonable doubt that the rules put in place for slot allocation failed to comply with their goal. If we attend to the figures below, it is impressive that the reallocated slots are almost zero between 2010 and 2016. On the other hand, there are hundreds of slots being traded or swapped every week. Figure 1: Airport slots traded, swapped and reallocated at Heathrow airport Source: Economist.com It is clear that the existing rules do not address the problem in the way the market needs. The inexistence of slots being reallocated is evidence we cannot ignore.
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