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Shannon Airport moving into profit

SHANNON Airport is on the brink of turning a profit for 2013, as its recovery continues.
“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,” Shannon Group chair, Rose Hynes, said on Wednesday.

Shannon Airport sign
The airport is on the brink of turning a profit. Photograph by John Kelly

She was speaking after the announcement of a new Shannon-Bristol route from Aer Lingus Regional and increases in capacity on its Birmingham and Manchester routes.

Not so long ago, Shannon was losing well over €100,000 per week and there were concerns about its sustainability after separation from the Dublin Airport Authority (DAA). However, there have been a slew of positive announcements on future services in the second half of this year, while traffic has been growing for some months.

Ms Hynes said the decision of Government to abolish the travel tax has been a major help to recovery.

“It was significant in prompting Ryanair and now Aer Lingus Regional, in putting on the additional capacity. I think that’s pretty significant. Ryanair were on record for some years saying they would not do it unless the travel tax was scrapped, so it does prove that sound Government policy really can achieve results.”

The new Bristol service will start on April 3. In addition, capacity on the Birmingham route will double and there will be an additional service on the Shannon-Manchester route, with three daily flights. Aer Lingus Regional will also be offering Customs and Border Protection (CBP) pre-clearance connectivity from Birmingham and Manchester, on Aer Lingus services to Boston and New York.

The opening of CBP pre-clearance was trumpeted as a huge plus for Shannon some years ago. Its use next year by Britons travelling to the US shows how it can be used to bring more business to the Clare airport.
Neil Pakey, Shannon chief executive, said people travelling from the UK will save time through the CBP and also pay less tax.

“When you look at it from the UK perspective and you think about going to the States, there are a couple of things we have to offer. The pre-clearance is a great facility, as the opportunity of arriving as a domestic passenger in the States saves you a lot of time. You combine that with the tax story. A family of four in the UK, if they travel direct to the US, will pay a tax of £248 sterling but if they come here, their total cost in tax to the UK will be £52 for the family. There’s a big difference and you have to look at the tourism product here and think about people stopping over as well. When people go to Australia, they stop off for a day or two in Dubai or Singapore, so when they’re going to the States, we can do more to market here as a tourism destination in the States for that,” he noted.

Ms Hynes said there is potential to increase the use of the CBP facility. “There are many cities in Europe that don’t have direct connectivity and we could hub them to Shannon. There’s no reason that couldn’t be a success, I really believe that.”

Good news story continues for airport with Bristol route
WHEN Shannon Airport was separated from the Dublin Airport Authority (DAA), a target of 2.5 million passengers was identified for long term sustainability. Another step towards that goal came on Wednesday, with Aer Lingus Regional announcing they will bring an extra 60,000 passengers next year and an extra 100,000 in 2015.

Shannon had just shy of 1.4 million passengers last year, but with several new transatlantic services being launched and Ryanair increasing capacity to Europe, things have been improving.

Aer Lingus Regional will be starting a new daily Bristol service on April 3 and will be increasing capacity on its Birmingham and Manchester routes. It will also be offering pre-clearance connectivity from Birmingham and Manchester onto Aer Lingus’ Boston and New York services.

On Wednesday, Simon Fagan of Aer Arann (which operates Aer Lingus Regional services) said, “From April next year, we will base an additional aircraft in Shannon, which will support the introduction of a significant increase in services, new routes and, importantly, the introduction of 20 additional positions in the company.

“It’s important to note that the expansion in Shannon is a direct result of the recent decision to suspend the travel tax from April next year, which is extremely conducive to supporting inbound tourism to Ireland and also to encourage outbound travel from Ireland. Aer Arann and Aer Lingus Regional will certainly do our best to support the initiative and expand our services across Ireland in 2014.”

He said the additional aircraft in Shannon will deliver approximately 100,000 passengers in a full year.

“Bristol is a significant node on the Aer Lingus Regional network. We serve it from the other bases in Dublin and Cork and both of those routes have been extremely successful in recent times and it makes logical sense to introduce a daily service from Shannon to support business and leisure connectivity into the west of the UK. Also, we’ll take the opportunity to double our capacity and frequency on the trunk routes to Birmingham and Manchester, which are very important to two-way connectivity from Shannon.”

Shannon chief executive, Neil Pakey, said when the airport was separated from the DAA, three main markets were identified.

“We looked at the three main geographic markets, transatlantic, Europe and the UK and tried to address each. We started off fairly well with the transatlantic market increasing and United’s (the American airline) announcement of daily Boston and New York services. We looked at the European market and clearly we’ve had some very good announcements recently with two carriers, Ryanair and Aer Lingus, announcing growth and new routes into Europe. For the UK market, we were looking more at our friends in Aer Lingus Regional and Aer Arann and looking to see how we could develop both the frequency of some of the existing destinations and some new route development as well.”

Clare TD Pat Breen said the Aer Lingus Regional decision is down to the Government’s decision to axe the travel tax. “This is a direct result of the scrapping of the air travel tax and I must say I am very pleased that both Aer Lingus Regional and Ryanair have responded so positively to this measure announced in the budget.

His party colleague, Senator Martin Conway, also claimed the improvements were down to the decision to do away with the travel tax. “This announcement builds on the recent successes by Shannon in attracting new routes and additional services. These expansion plans by the airline are as a direct result of the decision by the Minister for Finance Michael Noonan to scrap the air travel tax in Budget 2014.”

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