"Budget airlines complain as work begins on Berlin airport"

Tuesday, September 5, 2006

Berlin Resumes Airport Development Amid Operator Fee Concerns 
By Brian Parkin and Susanna Ray
Bloomberg News


Berlin's delayed plan to build an international airport capable of competing
for passengers with European rivals advanced today after the German capital
officially re-opened its Schoenefeld airport to development. 

Work on the 2,400-acre site began after a court in March rejected a bid by
local residents to halt the 2.2 billion euro ($2.8 billion) expansion of the
existing airport. Schoenefeld, based on the southeastern outskirts of the
city, will be overhauled by 2011, creating as many as 40,000 jobs when
complete, said developers Berlin Brandenburg International GmbH, a joint
venture between the government and two states, Berlin and surrounding
Brandenburg. 

The capital aims to boost discount, charter and business- passenger traffic
to 22 million passengers within 5 years from the 18 million currently shared
between Berlin's three existing airports, a plan that may hurt some existing
operators as the developers push up fees to cover their costs, according to
EasyJet Plc. Night-flight restrictions may also hamper competition,
officials have said. 

A restriction on flights between midnight and 5 a.m. ``is a problem that we
have to adapt to,'' said BBI Technical Managing Director Thomas Weyer, cited
in an interview broadcast today on N-TV business television. 

Job Creation 

Berlin's plan to boost employment in a city with a 17.4 percent jobless rate
in August may be at risk unless BBI can overturn a federal administrative
court ban on night flights, said Ole von Beust, mayor of Hamburg, cited in
an interview in today's Tagesspiegel newspaper. 

Frankfurt's Fraport AG airport, Germany's largest single-site employer,
employs some 50,000. About 250,000 gain work from Hamburg's Port Authority,
von Beust's administration said Aug. 24. 

Berlin's three airports are the by-product of the city's division during the
Cold War, with Schoenefeld serving the eastern part of the city, Tegel the
west and Tempelhof, built by the Nazis and used by the Allies during the
Berlin airlift after World War II, near the city centre. 

Tegel is due to close in 2012, the year after a redeveloped Schoenefeld
opens. Tempelhof is scheduled to close in October 2007, though there are
moves to keep the airport open, predominantly for business travelers. 

Easyjet Concerns 

EasyJet, Europe's second-biggest discount airline, said on Aug. 28 that BBI
may charge uncompetitive fees once work at Schoenefeld is complete. The
company's business at the airport comprises about 10 percent of all the
airport's flights. 

The airport's expansion plan is too ambitious and may lead to ``a cost
explosion'' for carriers, John Kohlsaat, head of EasyJet's German unit, told
reporters in Berlin. 

Until November last year, EasyJet was told by BBI -- which says Schoenefeld
is set to become Europe's biggest building site -- that the company may
continue operations from its present terminal beyond 2011, said Kohlsaat.
Easyjet has since been told it must shift operations to a planned new
terminal, increasing the amount of time passengers need to reach departure
gates and almost doubling the ground time for planes between flights to 50
minutes from 30 minutes at present, Kohlsaat said. 

BBI's plan has been drawn up with the expansion plans of all Schoenefeld's
operators, Weyer told N-TV. ``We can't plan an airport with just one
operator in mind.'' 

Following Berlin's reunification 16 years ago and the shifting back to the
historic capital from Bonn of the seat of government in 1999, the city's 3.4
million residents have gained increasing access to low-fare and
intercontinental flights. 

Delta Air Lines Inc. and Continental Airlines Inc., the U.S.'s third- and
fifth-largest carriers, started flying between Tegel, Berlin's busiest
airport, and New York last year.

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