Ryanair announced (08-Sep-2010) plans to cut its Shannon flights and traffic by a further 21% this winter 2010-11 in response to last week’s decision by Shannon Airport to impose a further 33% increase in passenger fees from 01-Nov-2010. The rise comes despite Shannon’s traffic collapsing by more than 1 million passengers from more than 2.7 million passenger in 2009 to below 1.6 million passengers in 2010. The carrier stated the “triple whammy” of Shannon’s high costs, their refusal to extend Ryanair’s five-year base deal, and the imposition of the Irish Government’s EUR10 tourist tax has devastated traffic, tourism and jobs at Shannon Airport and the mid-west region. The LCC announced that from 01-Nov-2010, its Shannon-Paris Beauvais route will be suspended, Shannon-London Gatwick frequency will be cut to six times weekly and Shannon-London Stansted frequency will be cut to 11 times weekly. These further flight cuts will reduce Ryanair’s operations at Shannon from 31 to 24 weekly rotations and reduce its traffic at Shannon from more than 480,000 to under 380,000 p/a – see Route Changes Table for more information.
CEO Michael O’Leary stated the traffic and tourism in the country can “return to growth and prosperity” if it returns to a “low-cost access policy”. He suggested:
- Scrapping the EUR10 tourist tax;
- Reversing the Dublin Airport Authority’s (DAA) 50% cost increases over the past two years;
- Breaking up the DAA airport monopoly and selling off the constituent parts to pay off the DAA’s EUR1.2 billion debt;
- Scrapping the PSO subsidies which have wasted more than EUR150 million in the past eight years funding non-viable domestic air routes;
- Scrap the Dublin Airport Metro and save taxpayers the EUR5 billion cost of yet another train system, which is not needed and won’t be used by airport passengers. [more]
Shannon Airport responded stating it regrets Ryanair’s decision and finds the suspension of the Paris route surprising considering it has been performing well, with a load factor of 80% in Aug-2010 (irishtimes.com, 08-Sep-2010).
Clare and Shannon councils called (08-Sep-2010) on Shannon Airport Authority (SAA) to outline its plans for the airport, following Ryanair's announcement. Clare Council also called on the DAA to provide SAA with autonomy for decision making, while Shannon Council called on the Irish Government to remove the tourism tax. [more]
Ryanair: “It is clear that the Irish Government and the DAA monopoly, are determined to destroy Irish air traffic, Irish tourism and Irish jobs. In the two years since the government introduced a EUR10 tourist tax and ordered over 50% increases in DAA airport fees, traffic at the three main Irish airports (Dublin, Cork and Shannon) has plunged by 33% from over 30 million to just 20 million passengers. Ireland has lost 10 million air passengers, over 10,000 jobs in airport and related services, and over EUR1 billion of lost tourism and visitor spend annually. In the year to April 2009 (before the government’s EUR10 tourist tax), Ryanair was on track to deliver 1.9 million passengers at Shannon. Now just two years later, following the EUR10 tourist tax and 33% price hikes at Shannon, Ryanair’s traffic will fall to less than 400,000, less than one fifth of what Ryanair’s base was and could again be delivering … Ireland can return to traffic and tourism growth. Ryanair would be prepared to double its passenger numbers on/off the island of Ireland, but only if there is a return to a low-cost access policy and an end to the failed policy of recent years of taxing tourists and raising airport fees to prop up what is I believe the insolvent DAA airport monopoly,” Michael O’Leary, CEO. Source: Ryanair, 08-Sep-2010.
Clare Council: “The need to establish an autonomous Shannon Airport has long been debated but there is also an urgent requirement to define the exact nature of the role played by the existing Shannon Airport Authority in managing the airport’s affairs. If indeed it is the case that it has little or no authority over the management of the airport then I would question its existence until such time as the Dublin Airport Authority (DAA) gives the airport full autonomy. The DAA must support the SAA in replacing the business lost as a result of Ryanair’s decision to curtail services. While the loss of business following today’s announcement is regrettable I would ask both Airport Authorities to immediately open negotiations with other airlines with a view to filling the void. Shannon Airport and the tourism sector in the wider Mid West region, which depends on quality connectivity to overseas markets, cannot and will not be able to withstand any further loss of business unless replacement airlines are found,” Christy Curtin, Mayor. Source: Clare and Shannon Councils, 08-Sep-2010.
Shannon Council: “Ryanair as a commercial enterprise is free to take whatever business decisions it wishes. However, air travellers are becoming increasingly weary of the airline’s lack of commitment to operating any given route for an extended period of time. Passengers are reluctant to book ahead as they realise that the scheduled flight may be withdrawn at a moment’s notice by Ryanair. This will not only have an adverse effect on business at the airports concerned but will also impact on Ryanair’s relationship with airline passengers as well as with airports. Ryanair appears to have a problem with the Government over the air travel tax but is instead punishing Shannon Airport and its customer base in the Mid West Region. I call on the Government to immediately remove this ludicrous tax on the tourism and business community and in doing so help prevent Ryanair and other airlines from scaling back operations in Shannon or at any other Irish airport in the future. If the Government is serious about tackling the decline in the domestic aviation and tourism industries, Minister for Transport Noel Dempsey must first review the salaries paid out to top earners in the Dublin Airport Authority. Imposing a travel tax on passengers is a cop out for the Government’s failure to address inflated salary and pension structures for management within the DAA,” Tony Mulcahy, Mayor. Source: Clare and Shannon Councils, 08-Sep-2010.