Dublin airport has been the scene of long queues and flight cancellations over the last week. - Copyright Scott Brownlee... Image accompanies story in Euronews describing 'big challenge' this summer of long airport queues in all European airports

Tension at TAP threatens airline’s recovery

… while on ground, baggage handlers call two-day strike

Wherever one looks today, there are tensions threatening air travel. Just as Portugal prepares for what it believes will be ‘the best summer ever’ in terms of holiday arrivals, the nitty-gritty of how to get here has become a major issue.

Cabin crew for Ryanair are on strike; Portway baggage handlers are on strike – and “nerves” at TAP are being stretched to the limit (see box story below).

Expresso has looked at the national and international picture today, in a text entitled: “Going on holiday? Find out where there is chaos”. 

Predictably, travel chaos seems to be the new pandemic. It is everywhere.

“From Brussels to Frankfurt, from Amsterdam to London, from Paris to Madrid, airports have underestimated the speed of recovery and been caught with reduced staffing levels, having let so many people go during the pandemic”, says the paper.

Hiring (or even re-hiring) has been frustrated by budgetary restrictions/ security clearance issues. “There simply are not enough hands to process thousands of tourists at once, whether through arrivals or departures, baggage or passenger control – a situation made worse by a multiplicity of strikes demanding better conditions and salaries (making up for the need) to work under so much pressure”.

The UK, Netherlands and Germany are already limiting flights; airlines are reducing programmed schedules. There is a scramble to try and “minimise chaos”, says Expresso – as “avoiding chaos is no longer possible. And the summer is only just beginning…”

Thus with foreign markets forced to make sweeping changes (for example, London Heathrow and Gatwick have asked airlines to reduce schedules by as much as 10% due to a chronic lack of baggage handlers; easyJet is cutting ‘thousands of flights’, British Airways too) Portugal is set to suffer irrespective of whether it manages to stop the massive build-up of passengers in arrivals halls that have recently hit the headlines.

Today, Portway baggage handlers begin a two-day strike, as part of industrial action scheduled to continue throughout the year. Says SIC television news “the protest is for better working conditions and the payment of extraordinary hours, including holiday pay. Paralysations (meaning further strikes) will be maintained throughout the year. There are already ‘strike notices’ for various days in the coming months, including on Christmas Day”.

Meantime, the country’s ‘flag carrier’ TAP is mired in problems.

Pilots and management at loggerheads; pressure increases on TAP; government silent (see update below)

These are the burning issues, and according to Expresso, they put TAP’s massive (€3.2 billion) restructuring programme at risk.

“Tension has been building over the last few days”, the paper explains. Pilots were told they could NOT hold a plenary meeting this morning (scheduled for hours with the least traffic, and to debate management’s decision to reduce pay cuts by only 10%. Pilots want their cuts reduced by 20%…)

This is a key-moment for the airline, says Expresso. It is facing “accelerated return of business (lots of tourists, in other words), a summer with a congested airport (Lisbon), the galloping price of jet fuel, lack of available crewmembers and flight cancellations and delays”.

The company’s decision to reduce pilots pay cuts by ‘so little’ (in pilots’ perspective) has been seen as provocation. Pilots talk of “corporate terrorism” and have even suggested management is trying to prompt a strike in order to “camoulfage its own mistakes”.

It is roughly a decade since TAP pilots went on strike, and they “have the power to stop the company”, Expresso admits.

A strike is “a weapon of pressure, but at a time like this there are those that fear it could also bring down the company, which is still fighting for its survival”.

Indeed, CEO Christine Ourmières-Widener used this as the reason for not sanctioning today’s plenary meeting.

Any interruption of normal schedules “would have a critical impact on the future” of the company, she told a press conference on Wednesday. And throughout this ‘face-off’, the government has held its silence.

Recapping, Expresso describes TAP’s losses last year (€1.6 billion), and in the first months of this year (€121 million). Could Brussels (which authorised the massive State-backed restructuring plan) decide it’s time to throw in the sponge? This is what Expresso is getting at. It is definitely a possibility.

A source in Brussels explains: “DGComp, the general directorate of European Competition is watching how (TAP’s restructuring) plan is being executed. If the decisions management is taking, particularly in terms of payments, impact on the accounts making numbers differ from the plan, the European Commission may consider this is likely to be non-compliance and notify the Portuguese State to restore the situation”.

In the final analysis, says Expresso, if the level of non-compliance became “very elevated”, Brussels could demand money lent to TAP by the State was returned.

The same source stressed that Brussels only agreed to the State’s bailout of TAP on the basis that the airline ‘complied with the restructuring plan and returned to profit in 2025’.

Says Expresso, TAP is ‘on thin ice’.

UPDATE: Since this text was uploaded, minister for infrastructures and housing Pedro Nuno Santos has said that TAP’s restructuring plan “must be respected”. The company is not in a position to reverse the approved salary cuts, he told reporters in the Algarve today where he was present for the signing the contract for the (long-awaited) electrification of the lines between Tunes and Lagos.

“The government does not negotiate; the TAP board is the one negotiating – but the government will continue to explain and raise awareness of the importance of us all being firm in carrying out the restructuring plan on which the survival of the airline (these pilots) work for depends,” he said, stressing: “We hope we can have the social peace at TAP that the airline needs and which the country deserves. The Portuguese have made a massive investment to save an airline that is very important to the national economy”, he added.

This last sentence will leave many baffled. If it was up to everyday taxpayers, few would have supported such enormous investment in TAP. The decision was made by the government, and the government alone.

natasha.donn@portugalresident.com