Mr Grayling said it would be very foolish for anyone to stop the current arrangements from continuing, as he was pressed on the impact for aviation of a “no deal” Brexit.
Chancellor Philip Hammond has said it is “theoretically conceivable” that all flights between the EU and the UK could be suspended on the day Britain leaves the EU, adding: “I don’t think anybody seriously believes that that is where we will get to”.
Labour quizzed Mr Grayling on the issue during Transport questions in the Commons.
Shadow transport minister Karl Turner said: “The Secretary of State may be in denial, but the Chancellor has finally fessed up to the fact that it’s conceivable that if there’s no deal with Brexit, flights between the UK and the EU might well be grounded.
“Isn’t it time that the Government got its finger out and gave the reassurances the aviation sector so badly needs?”
Mr Grayling replied: “I’m surprised he, as an experienced lawyer, didn’t read the whole of what the Chancellor said, because the Chancellor said that wasn’t going to happen and therefore he wasn’t going to spend a lot of money preparing for it.
“Now the actual reality is we’re doing lots of preparatory work for all eventualities, but of course the reason the Chancellor made the point he did is because he said that wasn’t going to happen.”
Earlier, Mr Grayling said it was for the benefit of all nations in Europe that the aviation freedom enjoyed over the past decade continued.
“It would seem to be very foolish for anybody to try and stop that from continuing,” he said.
“For those who have any concerns about 2019, they just have to ask the question how many hotels in Spain will be empty if the Spanish government chooses not to continue aviation arrangements.
“That is why we will continue to make good progress towards satisfactory arrangements for the future.”