REVIEW: Interesting year for standalone Shannon

 SHANNON separated from the Dublin Airport Authority (DAA) at the start of 2013 and despite much trepidation, it was a very successful year for the airport, with growth in passenger numbers resuming in the second half of the year.

Several new services were secured and 2014 should be Shannon’s best year since the recession began.

Shannon approached separation having had just 1.4 million passengers in 2012, the lowest number since 1988 and way short of the 2.5 million figure that had been set for it to achieve in the coming years.

However, the numbers kept dropping in the early part of 2013 and it wasn’t until June that it was reversed.

The addition of new routes to Chicago and Philadelphia helped the airport record an 8% increase in passenger numbers, compared with the previous June. Indeed, there was a 38% increase in transatlantic numbers, with effect of The Gathering helping. That gave Shannon momentum, as June was the first time a year-on-year increase had been seen for around half a decade.

In July, there was more positive news regarding transatlantic routes, as Aer Lingus announced it would increase its services to Boston and New York in 2014, also saying it would use smaller aircraft on the route, which makes operating the services at a profit easier.

There were a number of items of good news in the latter part of the year. In October, United Airlines announced an 88% increase on the Shannon-Chicago service next year. Spokesman Bob Schumacher said the route had performed very well.

“We are not only returning but returning with a lot more seats on the market and we’re extending the season from mid-May to mid-September. That’s all systems go. We’re very pleased with how it’s performed this year and looking forward to something similar next year,” he said.

Ryanair operations at Shannon helped bring passenger numbers to record highs towards the end of the Celtic Tiger and after the announcement that the travel tax would be axed next year, they announced eight new routes for 2014.

They will be from Shannon to Berlin, Paris, Warsaw, Nice, Fuerteventura, Krakow, Faro and Munich, while they will also increase services to Stansted. All told, the move will give Shannon an extra 300,000 passengers.

While there may be some wariness about Ryanair, given their failure to deliver agreed targets some years ago, 300,000 more passengers would be a huge boost, amounting to more than 20% of all Shannon had in 2012.

In December, Aer Lingus Regional announced a new Shannon-Bristol route and increases in capacity on its Birmingham and Manchester services. The increases will start in April and should bring in 60,000 passengers by the end of 2014, with 100,000 over the course of a full 12 months.

Again, the airline said the scrapping of the travel tax was a big factor behind their decision.

On the same day as that announcement was made, Shannon Group chair, Rose Hynes told The Clare Champion that Shannon was on the verge of recording a profit for 2013.

“We’re not into forecasting but at the end of this year we expect to turn a modest profit or break-even, which, for the airport, is a very good result on a standalone basis.”

This would represent a significant improvement for an airport that was said to be losing much more than €100,000 a week as part of the DAA group.

May 2013 saw the appointment of Neil Pakey as chief executive of Shannon. Mr Pakey enjoyed a successful career in the UK and was in charge at Liverpool John Lennon, as passenger numbers soared from 700,000 to 5.5 million.

In an interview with The Champion at the start of the autumn, he said the momentum Shannon showed after separation needed to be built on.

“The thing that’s impressed me the most is how well the brand of Shannon is perceived in parts of the world. We’ve got to really tap into that but it ain’t an overnight fix. We’ve had a very good summer. Hopefully that continues into next year and we can grow markets. It will be momentum that will take us there and it will be gradual but the biggest fear is that we would lose momentum. We’ve got to keep the momentum going and that means working with everybody who’s got the same interest as we have in getting traffic to grow,” he said.

Shannon’s progress in 2013 was acknowledged when it was highly commended at the World Routes Awards for airport marketing, held in Las Vegas in October.

Shannon was in the final five in the Airport Under 4 Million Passengers Category, due to its marketing programme since the split from the DAA.

Mr Pakey said it was a great result for Shannon. “We have some of the world’s leading news agencies and corporations around the world reporting on Shannon’s success and how it has managed to grow passengers in its first year of separation. That is promotion we could not buy.”

While there has been some reluctance to publicly state short-term targets for a recovering and restructured Shannon Airport, a report by the Oireachtas Joint Committee on Transport stated the aim is to have 1.9 million passengers in 2014. However other sources at the airport say it should be around 1.7 million. Either way, business should be far better than in recent years.

There was a negative development in mid-December, when it was announced that Flybe are to pull their Glasgow route.

Legislation for the creation of Shannon Group, combining the airport and Shannon Development is set to be passed in the new year, tying up some final threads.

On balance, it has been a very good year for Shannon, after a series of dismal ones.

With all the services that have been agreed, it looks like 2014 should see significant gains in traffic and momentum towards the goal of 2.5 million.