Message from the CEO

Schiphol connects the Netherlands to 326 destinations worldwide, making us Europe's 'best direct connected airport'. We are working hard to prepare for the future so that we can accommodate the increasing flow of passengers. At the beginning of April we opened a temporary departure hall, and in the autumn made room for the construction of a new pier and terminal. Perform today, Create tomorrow. Today's challenges go hand-in-hand with tomorrow's investments.

Congestion is the new normal

2017 was a year of excitement and of progress for Royal Schiphol Group. It was our busiest year ever with 68.5 million passengers at Schiphol. The record number signified an increase of nearly 8% compared with last year. On Monday, 31 July 2017, we welcomed more than 234,400 passengers, making it our busiest day ever. Whilst during previous summer holiday periods there were only a few peak days with more than 200,000 passengers, in summer 2017 there were only a few days when passenger numbers dipped below 200,000.
Congestion is the new normal at Schiphol. Extra capacity is urgently needed if we are to meet growing demand. The temporary departure hall, built to enable us to accommodate the growing number of passengers within the Schengen area, was completed in record time. However, things went badly wrong during the May holidays when we were unable to ensure that each passenger reached the gate on time. For three days, the picture at Schiphol was one of long queues, full baggage carousels and legitimate public concerns. We were quick to address the problems.

I'm happy to say that this was yet another illustration of how we all pull together at such moments. I believe compliments are due first and foremost to our colleagues and our business partners. They did sterling work in facing our peak times head-on. We came through our busiest-ever summer holiday period safely and successfully, and that's a good thing because the pressures will not be letting up.

Investing in capacity and quality

The lessons from the May holidays were addressed exceptionally quickly. Where possible we are deploying additional staff. We have devised new, practical solutions such as 'small bags only', and are refining existing applications, including digital passport control through the NoQ gates. In addition to the physical applications, digital innovations and data offer an increasing number of high-quality solutions that will enable us to provide passengers, business partners and ourselves with more online information on waiting times and wayfinding, for example.

We are also making good progress on investments for the longer term. Perform today, Create tomorrow. We are building tomorrow's Schiphol today to ensure that we can maintain our capacity and quality levels, since we want to continue to offer a good product, at a competitive price, during this turbulent period.

We are on schedule with development of the pier and terminal; to make room, we removed several roads and demolished multi-storey car park P2 and part of KLM Cargo Building 1. This required new parking alternatives and different traffic routes at Schiphol. These were necessary if we want to be ready to receive the first aircraft at the new pier at the end of 2019. In 2023 our new terminal will be ready to welcome its first passengers. The schedule is tight, but we really need that extra capacity landside and airside.

Safety first

Safety has top priority in everything we do, and we will never make any concessions on this point. In April 2017, the Dutch Safety Board published the Safety of Air Traffic at Amsterdam Airport Schiphol report. In it, the Safety Board finds that Schiphol is compliant with all safety levels under national and international regulations. Schiphol is a safe airport where we work round the clock to provide our passengers with a safe and carefree flight. The Dutch Safety Board made a number of recommendations to the airport, the aviation sector and the government to ensure that Schiphol continues to operate safely in the future. We have set to work on those recommendations with our partners, commissioning the creation of a Schiphol-wide Integral Safety Management System (ISMS). The purpose of the ISMS is to identify, monitor, analyse and mitigate safety risks that affect more than one partner in the chain. The results are then linked to the existing individual Safety Management Systems. It is precisely because of this close collaboration that we will continue to be the safe airport we are now in the future as well.

Environmental impact assessment

Schiphol seeks to develop in a sustainable way and in harmony with the local community. To that end, we recalculated our environmental impact in accordance with the new European noise model (Doc29). The results of the environmental impact assessment (MER) are relevant to embed the New Environmental Standards and Enforcement System into Dutch law. The MER will be the factual basis for further discussions with local community representatives, including local residents, administrators, the sector and the business community. The MER provides valuable starting points which the sector can use to ensure that it develops in a smart and sustainable way in line with the coalition agreement.

Approaching the limit

An economic upswing and inexpensive air fares have made air travel a commodity. Air travel is accessible to everyone, and everyone wants to fly. As surveys show, a staggering 94% of Dutch citizens say they have at one time used Schiphol's services. Demand is greater than ever leading to scarcity of capacity. With 497,000 air transport movements in 2017 - a rise of 3.7% - we have nearly reached the limit of 500,000. We agreed to this limit with the local community until the end of 2020, and we intend to stick to it. However, given current demand for air travel, this means we must urgently find alternatives.

Lelystad Airport has to open

The Alders Agreement provides for Lelystad to take over a sizeable portion of leisure flights from Schiphol, mostly non-Mainport-related flights to destinations around the Mediterranean. Under the permit issued by the Ministry of Infrastructure and the Environment, construction of the new runway at Lelystad Airport started in early 2017. The infrastructure will be ready in 2018, and the first flights will be able to land and depart from Lelystad a year later.

This development is urgently needed if we are to implement the selectivity policy. Once Lelystad Airport takes over a portion of non-Mainport-related air traffic, the scarce capacity at Schiphol can be devoted more effectively to Mainport-related traffic, that is to destinations that make the greatest contribution to prosperity and well-being in the Netherlands. We should not allow any further delays in the developments at Lelystad. And although, of course, due diligence is paramount, Lelystad Airport really does need to open.

Discussion

The development of Lelystad Airport, and the necessary reorganisation of airspace in particular, have provoked discussion and resistance. There is uncertainty about flight routes and the environmental impact assessment. The local community is sounding the alarm about the expected noise disturbance. These developments have a wider signifigance, and reflect concerns which we as a sector must take seriously. We need to find appropriate solutions. Politicians are being called to account and must address these concerns. This is part of a trend that continued in 2017: political and public sentiment around aviation is changing. Scarcely a year after our big centennial celebration, the festive mood seems to have turned. Has the Netherlands fallen out of love with aviation?

First of all, the magic seems to have dissappeared. The love affair with aviation seems to be ebbing away, leaving us with a paradox. Though more and more people want to fly, aircraft themselves are, increasingly, seen as a nuisance: they pass overhead too frequently, make too much noise and produce too many emissions. At the same time, it appears that more and more people want to live and work near an airport.

The second issue is that the perception of Schiphol as a driver of the Dutch economy is eroding. Together with all of the airlines and all of the companies at and around the airport, we continue to make a substantial contribution to the economy, particularly in terms of business climate, employment and trade. Added to that is the fact that we live in a globalising world where international connections are becoming ever more important. But do these economic interests give us carte blanche to grow at all costs? Clearly, the answer is no. More than ever, we have to balance the benefits very carefully against the costs.

The third issue is flagging trust within the aviation industry, owing to a lack of alignment and outdated agreements. The consensus model that until recently served us so well in relations with our neighbours and industry partners needs a reset.

Sustainability, clarity and decisiveness

Together with the aviation sector, Schiphol intends to address the issues we flagged in 2017. We are joining forces to promote sustainability, clarity and decisiveness.

Sustainability is the key word for our future. The benefits of air travel are increasingly being weighed against the costs. The sector needs to become more sustainable. With developments in the zero waste airport, the use of green energy generated by Dutch wind farms and our sustainable new construction plans, we seem to be on the right track. But there is also a lot more to be done. That includes daring to consider alternative forms of transport where that benefits the environment, such as high-speed train connections instead of short European flights.

Clarity. We need to create clarity and to re-establish consensus within the sector. We need to reach workable agreements with the government on sustainable development, selectivity and air space. We also have to create greater clarity for local communities regarding sensitive subjects like noise and the environmental impact assessment. In addition, we need to be crystal clear about the airport's economic and societal value, demonstrating Schiphol's vital contribution to prosperity and well-being in the Netherlands. Connecting to compete and to complete.

Decisiveness. We have to act on the clear sustainable agreements that have been made. Working with the aviation industry as a whole and with the airport's local neighbours will help to build political leverage. It is up to us to make aviation a less complicated issue for the new government. By pointing the way, we can help create the incentive for political action and, most crucially, for a new aviation policy document that sets out clear parameters for sustainable development and targeted action.

Successful collaboration

Royal Schiphol Group succeeds through collaboration. By that we mean not only the internal collaboration between Amsterdam Airport Schiphol, Rotterdam The Hague Airport, Lelystad Airport and Eindhoven Airport, but also, in particular, collaboration with external parties and airports throughout the world. Our international partnerships are essential if we are to maintain optimum links between the Netherlands and the rest of the world. They are also a means of strengthening Royal Schiphol Group's position on the global stage. Our stakes in Groupe ADP, Brisbane Airport Corporation, activities such as the management of JFK International Airport's Terminal 4 in New York and our strategic partnership with Incheon Airport in Korea enrich our strategic insights. These global connections ensure synergy and knowledge exchange, and contribute significantly to our results.

Collaboration enables us to fulfil our socio-economic role and bolster the strength of our hub. We would therefore like to thank our partners, our neighbours, local authorities and the national government. Novel partnerships in the digital area have put Schiphol on the international map. However, alongside the good news stories, there are also some issues regarding border control capacity and accessibility. For instance, the structural understaffing of the Royal Netherlands Marechaussee is a persistent source of concern. And investments in accessibility are required to enable us to accommodate the growing flow of passengers. Collaboration on these issues is vital if we are to achieve our targets for smart and sustainable development.

The next phase

On 20 October 2017, I announced that I will be stepping down as CEO of Royal Schiphol Group. This is a natural time for me to go, since the new government's coalition agreement is in place and the pledges made by KLM and Schiphol in response to the ACM survey have eliminated competition risks. This was my last year with the greatest company in the Netherlands: Schiphol. In principle, I will be handing over the baton on 31 March 2018. I will be available during the second quarter to ensure a smooth transfer of duties. It will be up to the new CEO to chart our course for the years ahead and to implement the new government's aviation plans, together with the sector.

Royal Schiphol Group is ready to take forward the opportunities and challenges the future has to offer. I have great faith in the organisation and, above all, in the professional and passionate people who work for us. Uniting with our partners to work on a sustainable, clear and decisive aviation sector will ensure that aviation continues to hold a special place in the heart of the Netherlands.

Jos Nijhuis

President & CEO of Royal Schiphol Group

Read further: Key events in 2017