The European Commission’s (EC’s) investigation into allegations that aviation original-equipment manufactures (OEMs) have abused their dominant market positions has been joined, in the role of a complainant, by the International Air Transport Association (Iata). The association announced this on Wednesday.
The investigation, being conducted by the EC’s Directorate General for Competition, was launched last year, with the sending of questionnaires to a number of participants in the industry, including airlines that are members of Iata. The purpose was to collect information that could support allegations of OEM abuses in the areas of aftermarket repairs (including services and parts).
“This is an area of deep concern to our members,” pointed out Iata director-general and CEO Tony Tyler. “There are relatively few equipment vendors and our members are frustrated that there is little flexibility in negotiations for aftermarket services. Airlines do not have the leverage to resolve these concerns individually. So Iata is fulfilling its role as their global trade association and representing their interests as a complainant.”
“OEM revenues are airline costs, so there is a natural tension on this issue,” he noted. “But airlines are and will continue to be important customers for OEMs. And we all have major common interests in our dedication to the continuous improvement of safety, efficiency and sustainability. Whatever conclusion the investigation comes to, at the end of the process there will be greater clarity on the rules of the game and how they should be applied. That will be a good development for all involved.”
Iata will not be seeking any monetary damages or any other compensation. “Our focus is on the future,” affirmed Tyler. “Our members want to be able to negotiate contract terms more effectively and with more options than the OEM community will entertain today. Our aim is to help rebalance the relationship so that airlines and OEMs can work together as true business partners in a normal commercial relationship.”