Traffic fall blamed for losses, while industrial unrest threatens more gloom

Three autonomous air traffic service (ATS) providers - Nav Canada, Germany's DFS and the UK's National Air Traffic Services (NATS) - have declared losses following the drop in traffic after last year's US terrorist attacks. Industrial unrest also threatens DFS and Nav Canada.

Nav Canada has declared revenue of C$875 million ($561 million) - C$145 million below forecasts - in the year to 31 August. It expects traffic and revenue to stay below pre-11 September levels in the 2002/03 fiscal year, when it predicts a revenue shortfall of C$80 million despite a 3% fee increase. Among the losses was C$7.3 million owed by bankrupt charter carrier Canada 3000. Nav Canada says it remains nervous about the prospect of bankruptcy for several large customers, such as United Airlines.

For the first three quarters of its current financial year, DFS is €57 million ($56 million) below projected revenue, although it says monthly earnings are better than early in the year. Traffic is down 4.8%, and Lufthansa's move to smaller aircraft has lowered its ATS bill. DFS faces a demand for a 10% wage rise from operational workers, including the newly independent air traffic controllers' union.

Part-privatised NATS has declared an operating loss of £30 million ($47 million) in the year to March 2002. It projects a revenue shortfall of £230 million over the next five years. It suffered in particular from a 15% drop in North Atlantic traffic, which has traditionally brought in 45% of the company's revenue because the aircraft, on average, are heavier and pay more. NATS plans to cut its costs by £170 million by 2005, and is awaiting an expected relaxation of its price-capping mechanism and a capital injection of £130 million, split 50/50 between the government and airports group BAA.

With many ATS providers being government-run, it is not possible to compare results with neighbouring providers, in France and the USA for example, because accounting procedures do not show them.

Source: Flight International