Small regional airports band together to promote the advantages of regional airports and lobby government for support
In response to the difficulties that small regional airports have faced, a number of them are joining together to form the Regional and Business Airport Group. Its members include Exeter, Norwich, Southend, Newquay, Durham and Blackpool. They hope to promote the advantages of regional airports, make the case for regional airports to government, and get more support. They say their airports help to rebalance the economy, and serve less well-connected regions – but they will need financial help. They want a cut in their level of Air Passenger Duty, and less regulation. Unless a buyer is found for Blackpool airport by 15th October, it will have to close. Manston, Bristol Filton, and Plymouth City airport have closed. Others have been taken over by councils or sold for token sums of money. The small airports with under one million passengers per year had much larger drops in numbers during the recession, from 2008, than larger airports. One analyst considers a small airport needs at least half a million annual passengers, to be viable. The small airports suffer from low cost airlines driving down fees. The FT says over 40% of European airports do not make a profit.
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Regional airports band together to promote sector
Regional UK airports have formed a new group to promote their services as a deadline for the possible closure of Blackpool International Airport looms.
Blackpool airport’s owner Balfour Beatty has set the deadline of tomorrow (October 7) to find a new buyer or it will be closed from October 15. Currently three airlines use the airport: Jet 2, Aer Lingus Regional and Citywing.
A group of airports including Exeter, Norwich, Southend, Newquay, Durham and Blackpool have set up the Regional and Business Airport Group to promote the advantages of regional airports and lobby the government to reduce the impact of regulations and taxes such as APD on smaller airports.
If Blackpool is closed, it will be latest blow to the regional airport industry following the end of flights at Manston in Kent earlier this year.
Other regional airports such as Cardiff and Prestwick have also been taken over by regional governments. While Cambridge Airport will lose its Cityjet services from October 25, only five months after the flights started.
A study by the Smith Institute think tank this summer said that regional airports were suffering due to a lack of direct flights to Heathrow.
The report, entitled ‘Making global connections: The potential of the UK’s regional airports’, found that only six UK regional airports now had flights to Heathrow – this compares to 26 regional airports with Heathrow services in the 1980s.
“This lack of connectivity resulted in the point-to-point traffic not having services to London and consequently these communities suffered considerably in terms of economic investment and growth,” said the report, which has been submitted to the Airports Commission
http://buyingbusinesstravel.com/news/0623203-regional-airports-band-together-promote-sector
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UK regional airports join forces as Blackpool fights for survival
October 5, 2014 (Financial Times)
Although the country’s smaller regional airports generate thousands of jobs and hundreds of millions of pounds in economic activity for their local economies, many are struggling or have shut down in the years since the financial crisis. Balfour Beatty, which owns Blackpool airport, has been trying to sell it since August and has made losses on it for several years.
Unless the company finds a buyer by October 15, it is likely to be the “end of an era for the airport” after almost a century of operation, according to Blackpool council.
Manston, in Kent, which shut in May, and Bristol Filton, which closed in December 2012, were both sold to property developers, while Plymouth City was closed in December 2011. Last year the Scottish government had to step in to buy Glasgow Prestwick for £1, following the example of the Welsh government, which took Cardiff into public hands in March 2013.
In response to the tough climate, a number of the smaller operators are banding together to form the Regional and Business Airport Group, to make the case for regional airports. Its members include Exeter, Norwich, Southend, Newquay, Durham and Blackpool.
John Spooner, head of Regional and City Airports Management – which operates Blackpool – said the government had to offer more support. “The government should recognise that small airports serve a vital role in their policy of rebalancing the economy and if they’re going to serve the less well-connected regions they are going to need some breaks.” The cost of regulation and air passenger duty tax weighed heavily on the smaller locations, he added.
Regional airports have suffered as airlines have focused on a few bigger airports such as Manchester, Birmingham and Edinburgh. Owners who often bought when demand from passengers was forecast to grow exponentially have ended up with heavy losses.
In 2007, a number of UK airports with fewer than 1m passengers annually saw declines of 40 per cent or more in the next five years, compared with an overall UK drop of 8.1 per cent.
“You need half a million to a million passengers a year to service an airport,” said David Bentley, an analyst at the Centre for Aviation in Manchester. “Since 9/11 [the September 11 terrorist attacks], regional airports have been left competing for low-cost carriers, who can drive down their fees. Over 40 per cent of airports in Europe do not make a profit.”
In response to their predicament, many airports have tried to diversify and create new streams of revenue, often through new uses of land on their site, such as creating business parks. Newquay in Cornwall looked in danger last year when Flybe announced it was stopping its daily London Gatwick service. The government stepped in to subsidise the route and has helped to fund a £6m industrial park development.
Southend has turned around its long-term decline and expanded. Owned by the Stobart group haulage company, it has attracted easyJet and also operates a freight business. The entrepreneur Sir Peter Rigby has been a supporter of regional airports, buying Coventry, Exeter and Norwich.
But others remain in difficulty. Peel Group, the property business which owns three airports including Liverpool John Lennon, this year bought back a majority stake in LJLA from the operator of Vancouver airport in Canada for £1.
Liverpool had been one of the fastest growing airports in the 2000s but has been hit by Manchester’s success in luring back budget carrier Ryanair. Passenger numbers have fallen from 5.2m in 2007 to 4.3m in 2013. Peel is not actively marketing the airport but would be open to offers, one person close to the group said.
Mr Spooner said Blackpool might survive if it could attract flights that could not get popular slots at Manchester. “Aviation has had one of the toughest periods it has encountered and Blackpool has had a history of passenger numbers growing and falling.” said Mr Spooner. “It’s too early to say it’s the end of Blackpool airport.”
http://www.ft.com/cms/s/0/25cad65e-4974-11e4-9d7e-00144feab7de.html#axzz3FOADsK7o
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Earlier:
Blackpool Airport closure shock
29 September 2014 (Blackpool Gazette)
Blackpool Airport will close down next month unless a buyer can be found. Since the end of last month, owners Balfour Beatty have been trying to find a buyer to take over the operating interests in the terminal, which was bought for £14m in 2008. But in a statement, the company today said that unless an agreement can be reached before October 7, it is “likely the airport will close” with the last commercial flights taking place on October 15th. The airport has been making a loss for a number of years. Three airlines fly out of the terminal.
They are Jet2.com, Stobart Air, and Citywing
http://www.blackpoolgazette.co.uk/news/local/blackpool-airport-closure-shock-1-6867209
Blackpool airport (losing about £1.5 million per year) put up for sale by Balfour Beatty
Blackpool Airport has been put up for sale by Balfour Beatty, which bought it in 2008. The airport is saying the sale will not affect flights, and it hopes to get new routes. Balfour Beatty paid £14m for the airport, and has now has decided to sell its operating interests in the site as part of a wider decision to sell all its interests in regional airports. But it will continue to own the land on which the terminal stands. Alan Cavill, assistant chief executive at Blackpool Council, which sold the airport in 2004 for £13 million, welcomed the news. A London-based restructuring specialist is handling handle the sale and inviting expressions of interest from would-be buyers before September 10th, but no price has been put on the airport. Balfour Beatty has invested almost £30m in the site since 2008. But passenger numbers have dropped over the years from a peak of around 500,000 in 2007. It gets passengers from the North West of England, Southern Scotland, Cumbria and Cheshire. The airport makes an annual loss of about £1.5m per year. Three airlines are based at Blackpool including Jet2 with 13 destinations.
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