Air travel hit by economic turbulence

Published on Friday 12 December 2008 21:03

PASSENGER numbers at Scotland's previously most buoyant airport have shrunk this year for the first time in at least a decade.

Soaring expansion at Edinburgh Airport has been reversed as the looming recession takes its toll on one of the Scottish economy's success stories.

The airport, whose passenger increases peaked at 14.5 per cent a year in 2002, recorded a 0.1 per cent fall in the year to November, to nine million.

The airport's first plunge into full-year contraction in recent history follows a 7.8 per cent drop in passenger numbers last month to 638,700. Most of the reduction was among passengers on UK flights, with those flying to London down 13 per cent.

Experts described the figures as "disastrous", with the airport's owner, BAA, admitting 2009 would be a "similarly difficult year". The firm had previously claimed Edinburgh Airport's runway was Scotland's most valuable economic asset.

Glasgow Airport fared even worse than Edinburgh, with passenger numbers down by 15.6 per cent in November to 512,900. They fell by 6.5 per cent over the year to 8.2 million – the lowest for five years.

At Aberdeen, passenger numbers fell by 11.5 per cent last month to 240,700, and by 3.4 per cent for the year to 3.3 million.

However, Edinburgh's downturn is the most significant because of the reversal of fortunes – it now joins the other two in having to grapple with falling passenger numbers.

Richard Havers, a former airline executive based in East Lothian, said: "The figures are falling off a cliff – they are a disaster. The market that is really being hurt is leisure, which does not bode well for the likes of EasyJet and Ryanair. However, it is now easy for passengers to get incredibly cheap fares.

"Edinburgh has been among the most resilient airports up to now because of its greater proportion of business travellers, but that could be hit as the recession bites."

John Strickland, of the aviation analyst JLS Consulting, said: "All the airports are down by a pretty substantial magnitude, although Glasgow is down by more than Edinburgh because it caters for more leisure travel."

BAA, which owns all three airports, said the passenger falls were largely a result of airlines cutting flights because of reduced demand. It said there were nearly 210,000 fewer airline seats available at the airports last month than a year earlier.

A spokesman for the firm said: "This is traditionally a quiet time of the year, and airlines often reduce capacity during the winter months. However, this year, with demand falling and airlines under pressure to reduce costs, the cut in capacity is even more acute."

BAA's other airports, which include the main London terminals, also suffered from the closure of Bangkok's international airport by anti-government protesters and a strike at Air France. Passenger numbers at Heathrow were down by 4.8 per cent, Gatwick by 13.5 per cent and Stansted by 13.2 per cent.

However, BAA has remained bullish, saying the evidence of previous economic downturns showed "passenger volumes will recover in due course".

ANALYSIS

EDINBURGH Airport – joining its two sister Scottish airports on a downward passenger trend – calls into question owner BAA's expansion plans, which were based on predicted growth.

Despite this, the Spanish-owned firm said it had no plans to scale back development. This is also despite the prospect of being forced to sell off Glasgow or Edinburgh airport by the Competition Commission.

Development blueprints show BAA expects Edinburgh to grow by 3.2-4.5 per cent a year to 2030 and Glasgow by 2.6-4.1 per cent. Richard Havers, a former airline executive, said: "It staggers me that there has been no change to the plans."