AENA: high airport charges deter traffic at Spain’s airports. Ryanair discounts its discount scheme

Following dramatic declines in airport passenger numbers in 2012 and 2013, Spanish airports operator AENA has decided to introduce an airport charge discounting scheme to offer incentives to airlines to grow their traffic in Spain once more. With plans being formulated to privatise Spanish airports, the success of this initiative will be closely watched by both industry participants and potential investors.

In this report, we examine traffic trends at AENA and consider whether they have been affected by higher airport charges. Our analysis suggests that there is a clear link and so action to reverse falling traffic numbers through lower charges seems a logical step.

The questions then are whether the discounts offered will have the desired effect and how sustainable will be any resultant growth in passenger numbers.

Ryanair is the biggest carrier in Spain by passenger numbers and its CEO Michael O'Leary has called AENA's discount scheme "almost unachievable".