LONDON – As a result of recent sanctions, Aeroflot is unable to sell its valuable slots at London Heathrow.
The Russian national carrier has around 70 weekly take-off and landing slots at the capital’s airport, which is enough for five daily roundtrips.
Such sanctions imposed by the UK Government have gone as far as sanctioning Ural Airlines and Rossiya Airlines, which also have slots at London Gatwick as well.
The New Sanctions…
Ever since Russia started waging war on Ukrainian land back in February this year, many Western countries have imposed significant and heavy sanctions causing a major dip in Russia’s well-established economy.
The latest sanctions from the United Kingdom will suffer yet another blow to Russia’s economy and their airlines, as it will prevent them from selling their landing slots at British airports.
Their landing slots, according to the UK Government, are estimated to be valued at up to £50 million, of which if these were sold, this would help Russia in recovering its heavily hit economy, however, this will now not be the case.
Commenting on the new sanctions, British Foreign Secretary, Liz Truss, has said, “As long as Putin continues his barbarous assault on Ukraine, we will continue to target the Russian economy. We’ve already closed our airspace to Russian airlines.”
“Today we’re making sure they can’t cash in their lucrative landing slots at our airports. Every economic sanction reinforces our clear message to Russian President Vladimir Putin – we will not stop until Ukraine prevails.”
These new sanctions will mainly hit Russia’s flag carrier and state-owned airline, Aeroflot, with their slots that they currently hold at London Heathrow Airport (LHR) but will also hit their owned Rossiya Airlines as well as Ural Airlines.
This announcement comes as the UK’s Transport Secretary, Grant Shapps takes up the Presidency of the International Transport Forum. He will also use this forum to call for a united response across many Western allies against Russia’s invasion of Ukraine.
Grant Shapps has also said this:
“The UK was one of the first nations to implement sanctions on Putin and his allies; we forbade entrance to their ships and planes, strangling them of the privilege to benefit from global trade and commerce.”
“Today, the UK Government has built on the strong action we have already taken against Russia’s flagship carrier Aeroflot, along with Rossiya and Ural Airlines.”
“This means they will be unable to use their expensive landings slots at UK airports. Our actions will also prevent Russia from selling the slots and cashing in on up to £50 million.”
Their Sanction Profiles
Aeroflot, which is Russia’s largest airline and is also among the top 20 largest airlines in the world, is majority-owned by the Russian state.
Their continuation of service is providing not just the Russian economy, but also the Kremlin, a major source of revenue, so heavily restricting the airlines’ operations globally, will aid in hampering that source of income for the Kremlin.
On top of this, the UK has also placed sanctions back in March on the Chief Executive Officer of Aeroflot, Mikhail Igorevich Poluboyarinov, which has subjected the airline to an asset freeze.
Not only this but both Rossiya Airlines and Ural Airlines are subject to the same sanctions as both carriers provide significant revenue streams to the Kremlin alongside Aeroflot, both carriers, as well as Aeroflot, are also subjected to an asset freeze from the British Government.
Will A Special License Be Needed To Sell These Slots?
Now, of course, such an announcement does put the slot’s usage into disrepute, especially if they can be used by other airlines instead.
Slots at Heathrow in particular are quite hard to come by and acquire, so in this case, will we see something similar to that what happened with Chelsea Football Club?
Why use Chelsea as an example? Well, with the club originally being owned by Russian tycoon Roman Abramovich, it took a special license from the UK Government to sell the club, with the proceeds heading away from Abramovich.
The same thing could happen in theory, whereby a special license to sell the slots at Heathrow and Gatwick could happen, but none of the proceeds go to the Russian carriers.
AviationSource has approached the UK Department for Transport for comment on whether the government is considering a motion like this.
They, unfortunately, just referred me back to the press release that was unveiled a couple of weeks ago, which doesn’t really go into detail about something like a special license.
With this in mind, AviationSource has also approached the UK Civil Aviation Authority for a comment, and we are waiting for a response at the time of writing.
Overall, it will be interesting to see the fate of these slots, especially as they would be quite valuable to other Western carriers looking to make a snap-up out of the major London airports.