Ryanair to axe Glasgow Airport base, cutting number of routes from 23 to 3
Ryanair is to close its base at Glasgow Airport, warning that 300 jobs could go as a result. The airline, which also operates out of Prestwick, Edinburgh and Aberdeen, will cut the number of routes out of Glasgow from 23 to 3. Ryanair’s Chief commercial officer David O’Brien tried to blamed the change on the cost of APD and said Glasgow “simply could not bear the burden”. APD is very unlikely to actually be the reason for the move; it is actually just £13 for any adult (kids go free) on any return European flight, and most of Glasgow flights are European, or domestic (domestic return flights pay £13 APD for each half). Glasgow Airport said it was “bitterly disappointed” by Ryanair’s decision. Ryanair made the announcement as it unveiled its schedule for winter 2018, confirming that only its services to Dublin, Wroclaw and Krakow would continue from Glasgow. Instead 11 new routes would be added to its Edinburgh schedule. Ryanair is ruthless in its treatment of airports, cutting them if they are not sufficiently profitable. For many – Prestwick included – it’s the only passenger airline, and it’s not afraid to use that leverage. Glasgow airport routes had lower prices and tighter margins – just not profitable enough – easier to make money at Edinburgh.
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Ryanair to axe Glasgow Airport base
27.2.2018 (BBC)
Ryanair will add 11 new routes to its Edinburgh schedule
Ryanair is to close its base at Glasgow Airport, warning that 300 jobs could go as a result.
The airline, which also operates out of Prestwick, Edinburgh and Aberdeen, will cut the number of routes out of Glasgow from 23 to just three.
Chief commercial officer David O’Brien blamed the change on the cost of air passenger duty and said Glasgow “simply could not bear the burden”.
Glasgow Airport said it was “bitterly disappointed” by Ryanair’s decision.
A spokesman for the airport said there was “no doubt” that the failure to replace air passenger duty (APD) with a cheaper air departure tax (ADT) in Scotland was behind the move.
The Scottish government said it remained committed to reducing APD by 50%, but that there were still issues to be resolved before this could be introduced.
Ryanair made the announcement as it unveiled its schedule for winter 2018, confirming that only its services to Dublin, Wroclaw and Krakow would continue from Glasgow.
The company said 11 new routes would be added to its Edinburgh schedule.
Ryanair has had to be nicer about its passengers of late. Addressing them as suckers for low fares could only get the airline so far.
But it remains ruthless in its treatment of airports. For many – Prestwick included – it’s the only passenger airline, and it’s not afraid to use that leverage.
So why abandon Glasgow as a base? Chief commercial officer David O’Brien talked a lot about Air Departure Tax (the Holyrood-controlled rebrand of Air Passenger Duty). He also said it had to do with Brexit.
It’s not immediately obvious why either should be the reason, when Edinburgh and Glasgow are equally affected.
Ryanair’s view is that Glasgow’s market sustains lower prices and delivers tighter margins, so the impact of flat-rate ADT is proportionately larger than in Edinburgh.
But the removal of Glasgow as a base for one aircraft is more of a signal of what could follow if there’s no movement on air tax, and if there’s no deal on “open skies”‘ across Europe post-Brexit. It’s a message to governments in Holyrood, Westminster and (if it reconvenes) in Stormont.
There’s no pledge to boost flights if the tax is cut or removed, but Ryanair is experienced across Europe at using carrot and stick to get its way.
There are other factors, which have come to the fore since Edinburgh and Glasgow were forced apart by the competition regulator and under different ownership from 2012 they began to compete.
The capital’s airport has better ground transport, having quick links not only to the city, but to the M8 and M9. Edinburgh travel time for Lanarkshire and east Glasgow can rival Glasgow Airport, to the west, particularly around traffic peaks.
And as Ryanair has pivoted from offering cheap flights to the sun to become a major inbound carrier of tourism and business flyers, it has found that the Edinburgh brand is significantly stronger with foreign visitors.
Mr O’Brien said: “Sadly the weaker Scottish market is even weaker still in Glasgow, which simply can’t bear the burden of APD at £13.
“This should not come as a surprise to the government, we did say that our growth in Glasgow was based on their promise to abolish APD, which morphed into a promise to half APD, which suddenly has disappeared into the ether and quite frankly we don’t have any more patience.
“There are other markets in the UK and Europe which offer a more compelling proposition.”
‘Airline industry’
Mr O’Brien added: “Passengers mean jobs and around 500,000 passengers will be lost at Glasgow, pressurising around 300 jobs which will probably be lost.
“The flipside is that you’re looking at around 700 jobs being introduced to Edinburgh.”
Mr O’Brien also said that Brexit was a threat to Scottish tourism and the airline industry in general.
The Scottish government unveiled plans to replace air passenger duty with a cheaper air departure tax in 2017.
However, the plans have yet to be implemented and require EU approval under state aid rules.
‘Stark scenario’
A spokesman for Glasgow Airport said: “We are bitterly disappointed at this decision by Ryanair which is not only damaging for Glasgow and wider Scottish connectivity, it will impact approximately 100 jobs locally.
“This is a result of the airline’s review of its single aircraft bases. However, we have been left in no doubt it is also a consequence of the Scottish government’s inability to introduce its proposed 50% cut in air departure tax.
“Despite clear and repeated warnings from both airports and airlines about the potential impact of this policy not being implemented, we are now faced with a stark scenario that includes the loss of 20 services and a significant number of jobs.”
Scottish Finance Secretary Derek Mackay described the news as “very disappointing” and said uncertainly around Brexit was having a “negative impact” on route development in Scotland.
“We will continue to work to work in partnership with Ryanair and other airlines, and to support all Scottish airports, to do everything possible to grow the number of international routes to and from Scotland,” he said.
“The Scottish government continues to be committed to reducing ADT by 50% by the end of this parliament and we want to get on and deliver this.
“But this has been deferred until the issues raised in relation to the Highlands and Islands exemption have been resolved to ensure that the devolved powers are not compromised.”
In future Ryanair will host 45 routes from Edinburgh, including the 11 new routes.
The airline’s summer schedule will operate as planned out of Glasgow.
Ryanair opened its base at Glasgow Airport in autumn 2014, one of several new bases opened across Europe that year.
At the time it said it remained committed to Prestwick Airport and would continue to offer flights from there.