Economic blow to airlines could surpass 9/11: EU

Posted at 04/19/10 11:07 PM

BRUSSELS - The volcanic ash cloud that has grounded many flights could deal a bigger economic blow to the airline industry than the attacks on the United States on September 11, 2001, the EU's transport commissioner said Monday.

European Commissioner Siim Kallas also told a news briefing that the European Union could not compromise on passengers' safety during the crisis.

Airline industry group IATA has criticized Europe's response to the ash cloud and called for urgent steps to reopen airspace after five days of closures that have cost airlines $250 million a day.

"The assessment (of the airline industry) is that the consequences of this unprecedented event ... extend (beyond) the 9/11 impact. Airlines are not ready today to asses the losses," Kallas said.

But he said there must be no panic when taking decisions about the crisis. He also reiterated that airlines had an obligation to compensate passengers who had been unable to travel because of the crisis.

He was due to take part in a conference call of EU transport ministers later Monday. Asked whether there would be a decision taken on resuming flights, he said: "There must be some kind of common approach."

A spokeswoman for the European Commission, the EU executive, said the airline industry had not yet applied for any compensation for revenues lost because of the ash cloud.

Any aid provided by EU governments for airline companies would have to be proportionate to the damage suffered because of the crisis, she said. Requests for aid would be reviewed "rapidly," she added.

A Commission spokesman said separately that the EU was checking the possible impact on citizens' health from the ash cloud but had no concerns for now.