This is despite some negative surprises regarding the business plan for this year. One of them, already signaled by executive president Christine Ourmières-Widener, is the escalation in the price of treaties, one of TAP’s main costs, and the other is the imbalance in the recovery of the Portuguese company’s main market – Brazil. Cheap flights are full, but they go relatively empty because Europeans are reluctant to travel to one of the countries most punished by Covid-19.
Next State Budget will have 990 million for TAP, but capitalization ends in 2022
However, this new injection is far from solving the fundamental problem of the localization plan under which more than three billion euros are available for a TAP, including the 1.2 billion euros already delivered and spent, and for which there seems to be no light at the end of the tunnel.
The delay and complexity of TAP’s negotiation weigh several factors that distinguish this process from the aid plans given by various Member States to their flag companies, starting with the rescue and information regime that the specialized services insisted on applying to the Portuguese company because the financial difficulties predate Covid-19.
The complexity of the measures, the degree of detail in the information presented by the Member State and the need to verify that the rules are respected can lead to the dragging of options and these processes. But in the case of TAP, the picture is still complicated for two reasons.
The guidelines of the European rescue regime seek to prevent the plans from being predominantly supported by the State, without proportional contributions from the company itself and from new private investors (or those who are guided by market rules). The guarantee is to guarantee the company’s long-term viability without the need for additional support from the State and to give confidence that, once the solution is completed, a TAP can compete on its merits with other companies in the market.
The explanations given by the Executive also did not rule out the reservations raised in a letter sent by DG Comp in July about the feasibility of the plan presented by Portugal and about the profitability of the foreseen financing. In this letter, the Commission services mentioned that TAP’s own contribution – the result of the cuts in the calculation plan – was only 36% of the total and they amount to the extermination of private investment or financing, contrary to what happens in other plans. European flag companies.
But it is in the slots – which the initial version of the Lisbon plan wanted to maintain – that Brussels most carried the tone, noting that TAP controls a strong position in the “highly congested Lisbon airport” and that no commitment was made that there would be a capacity reduction in expected recovery after construction.
The reduction of slots currently held by the Portuguese company has, in fact, been a demand from competing companies, voiced above all by Ryanair, which even in the summer increased pressure on the Portuguese company, accusing a TAP of blocking slots it was not using.
Ryanair accuses TAP of “deliberately” blocking slots that it does not use at Lisbon airport
a company low cost Ireland has waged a relentless war against the Portuguese plan to finance TAP in more than three million euros, which passes through the courts – with a partial victory – and through the stages of the press divisions carried out by Executive President Michael O’Leary. Although Ryanair is the most public critic of this process, and is waging a war without headquarters, no general court of the European Union against all aid – the Observer has indication that other companies are moving in Brussels to demand more slots in Lisbon, a destination that was booming before the pandemic.
All in all, the approval process for TAP’s plan in the corridors of Brussels has lasted a year and five months and does not seem to have an end in sight for now. And there are those who have already compared a TAP to Alitalia, an in-depth investigation of state aid has been going on for several years. It is true that the Portuguese company only accepts the money that the European Commission authorized, but Italy scored points in Brussels when it managed to secure the separation of the new airline ITA from the wrapped up Alitalia. But Italy, highlight some of the sources heard, has more strength than Portugal and the one at the head of the Government, a prime minister more committed to the dossier and named Mario Dragi.
Close and open another one on the side? Italy did what Portugal pushed away at TAP for having “uncontrolled costs”