Originally Posted by
Skipness One Echo
The key point is the market isn't growing massively so you're looking at nicking back traffic off LTN and maybe SEN in the first instance. I want to understand how it is they intdend to attract traffic that BAA failed to snare and make money at the same time. That's the bit I don't get. Are they going to subsidise medium term losses at STN from MAN profits?
This raises a question. Correct me if I'm wrong, but isn't MAG publicly owned? I seem to recall majority owners are the Manchester area councils, and private investors are thirty-something percent.
Now consider the (in)famous 2005 EC guidelines on state aid in the aviation sector (now being rewritten to be made even stricter) which lay down what can be done with public funds (i.e. what startup incentives publicly-owned airports can legally offer to airlines, essentially very little). These currently form the basis of IIRC nearly 20 in-depth European Commission investigations into various European airports' deals with airlines (well, in 90% of cases with one airline in particular, but that's not my point here).
The EC guidelines don't apply to privately owned airports because the assumption is that a private investor is spending his own money and trying to earn a commercial return, but this assumption may not hold for a public investor. Now one can argue about whether or not the guidelines are appropriate, proportionate, adequately enforced, etc. (and many people do), but the fact of the matter is that they are there.
Heathrow is privately owned.
Gatwick is privately owned.
Southend is privately owned.
London City is privately owned.
Luton is in public ownership but the operator is a private company.
None of these airports are subject to the EC2005 guidelines.
If MAG is publicly owned, then STN
is subject to the guidelines. So if STN is winning any traffic away from other airports with low-cost deals, one could imagine those other airports complaining to the Commission...
Just a thought...