Greece's Airports Struggle to Survive during COVID-19 Lockdown

Αssociated Press

A passenger wearing a face mask sits outside the Eleftherios Venizelos International Airport, in Athens on Tuesday, March 17, 2020. (AP Photo/Thanassis Stavrakis)

ATHENS - Left with few flights during the COVID-19 lockdown aimed at preventing the spred of the virus and barring almost all air traffic, the two companies that manage Greece's main airports said they likely can't meet payments required the state and their operation is being threatened.

Officials from the Athens International Airport (AIA) and Fraport Greece, which manages 14 regional airports, have asked the government for leeway in dealing with their now financial crisis after they boomed during successive record tourism years.

In a letter to key ministries, AIA said passenger traffic at the country’s biggest airport “has completely collapsed, while commercial revenues are now zero,” as a result of the lockdown, according to Kathimerini.

AIA said the absence of commercial traffic and passengers has severely impacted “the smooth servicing of the company’s financial obligations and its corporate sustainability.,” without elaborating whether it could still operate after the lockdown.

AIA warned it may be unable to meet its obligations to the state, such as the payment for its rights to the infrastructure based on group results, citing Article 31 in the concession contract referring to external factors such as the epidemic, the paper said.

Fraport Greece wants the suspension of the payment of 44 million euros ($47.62 million) for its 2019 installment under a contract that provides an annual fee of 22.9 million euros ($24.78 million) for leasing and operating the 14 airports, plus a floating payment amounting to 28.6 percent of earnings before interest, tax, depreciation and amortization (EBITDA).

The consortium cited a contract clause providing for unforeseen events to protect its liquidity and said that, “the state will not lose any revenues, because the payment obligation will continue to apply (but for) a later time.”

Passenger traffic at the 14 Fraport-managed airports has dropped 99 percent, the company said although March data of the German group showed a 78 percent drop because most traffic didn't nearly completely stop until the middle of the month.