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Slot Trading – Leverage for Efficiency?

Updated: Aug 28, 2023

Slots – a business worth millions

Did you know that millions of USD are spent on slots? While in most parts of the world slots have no price tag and are traded with no payment, there are exceptions. In those cases payments are always measured in terms of a pair of slots. In 2016, Oman Air paid 75M USD for a pair of slots, breaking all dimensions.

Interestingly, the United Kingdom allows buying and selling, even without regulation. For example, a buyer may insist on not being named and this currently poses no legal problem. Curiously, there is not even a legal claim to slots, because from a purely legal point of view, a slot does not belong to anyone – not the airline, not the airport and not the state or the appointed slot coordinators.

Attempts to make slot trading in the UK transparent via a platform failed. Airlines do not like to show their cards. A coordinator can quickly feel like an administrator here.

Fake swaps

Buying and selling is currently permitted in the UK and is forbidden in most other markets like the USA, Canada, EU and Japan. Airlines in other regions have to find alternative ways to optimize slot utilization and slot allocation according to their interests and needs.

Where no purchases are possible, slot mobility can also take place through disguised fake swaps. Here, slots are officially swapped, money may flow in the form of leases or other fees, and a slot pair is immediately returned to the slot pool by the seller / slot giving airline. In some regions, attempts are being made to prevent these practices.

Overall we believe that opening more markets for slot sales would discriminate smaller airlines and hence limit competition. Financially strong carriers would be able to secure themselves the most desirable departure times.

But what else can airlines do to get their desired slots? There are tricks and tactics to be learned from. Efficient and targeted slot management should not be neglected. It secures airline and airport profitability and serves all passengers in the long run. A key driver for sustainable growth.


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