Doncaster Sheffield-3
If the mayor's money supply to MME suddenly stopped... I'm wondering what might happen long term.
The question for both is whether there is sufficient market to support the airport once the public money stops.
Teesside wasn't dead when the mayor bought it. There were a number of active flights and money making companies on site. The airport was also fully equipped if not antiquated and fully staffed.
Im sure it’ll all be part of the detail being thrashed out now. Too much risk aversion from the public sector might prevent a signing on the dotted line.
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MME is completely public owned with most of the debt sat with the public sector, as such the public own the asset.
As I understand Doncaster is on a lease, which im guessing we don't know the actual terms of!
MME on paper has only cost around £14m when looking at the balance sheet.
MME was an established airport with a legacy carrier (KLM) and several incumbent businesses/operations that create a minimum base to work with, when taken over.
Doncaster has nothing pretty much and the £140m is not going to go far once they have invested in the hardware and staff to get the place up an running. Unfortunately I just can't see it working.
FPOs are estblished at East Mids, ad hoc freight is covered by East Mids and Stansted.
Legacy carriers are in at Humberside, Norwich and Leeds.
Low Costs are firmly established at Stansted, East Midlands and Leeds.
If you want to make it viable I would say you need double the amount they have to spend to allow for time to build from nothing.
As I understand Doncaster is on a lease, which im guessing we don't know the actual terms of!
MME on paper has only cost around £14m when looking at the balance sheet.
MME was an established airport with a legacy carrier (KLM) and several incumbent businesses/operations that create a minimum base to work with, when taken over.
Doncaster has nothing pretty much and the £140m is not going to go far once they have invested in the hardware and staff to get the place up an running. Unfortunately I just can't see it working.
FPOs are estblished at East Mids, ad hoc freight is covered by East Mids and Stansted.
Legacy carriers are in at Humberside, Norwich and Leeds.
Low Costs are firmly established at Stansted, East Midlands and Leeds.
If you want to make it viable I would say you need double the amount they have to spend to allow for time to build from nothing.
Double of £140m... ie £280m is a lot of *public* money to reopen an airport that has been struggling for years. That kind of money can buy a large amount of alternative infrastructure
Not targetting DSA here; that goes for the whole of the UK.
"They are competing in the same market -"
????? Teesside also has access to all of Durham - which is a significant catchment area - anywhere south of Tyneside is as close to Teeside as NCL
????? Teesside also has access to all of Durham - which is a significant catchment area - anywhere south of Tyneside is as close to Teeside as NCL
My point is that DSA and MME are competing in the same market, not just in terms of catchment areas but in terms of available aircraft from airlines etc and attracting other aviation related industries, logistics etc.
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The £138m is out of a gain share pot over I think 30 years. They are allowed and will have to borrow to front up some of the capital start-up costs, with the debt being reduced by the annual funding income, so sounds like they do not anticipate the running costs post setup swallowing all of the funding. I'm assuming that they will have a break clause to get out if it does not go to plan. The major pieces of equipment will still have resale value.
They also released that an experienced operator had offered £100m to Peel to purchase the airport (and maybe surrounding area), which had been rejected.
They also released that an experienced operator had offered £100m to Peel to purchase the airport (and maybe surrounding area), which had been rejected.
His predecessor could have saved the airport by investing £20million in exchange for equity, but chose not to because he thought the business was not likely to be profitable. Thats been spun into a myth that Peel refused to ‘open their books’. Thats not what was said in the meeting minutes.
Avoid imitations
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It would make more sense to have an airport on each side of the Pennines, rather than one stuck on top of a hill in the cloud with poor access and no cross runway.
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1/ Catchment - Leeds is the 2nd most populous district in the UK after Birmingham followed by North Yorkshire in 3rd (districts not counties)
2/ A very well run home-based airline in Jet2
3/ Inbound and Outbound traffic
Leeds City Region population has the 2nd highest propensity to fly in the North of England behind Manchester City Region, North Yorkshire inclusive. Liverpool 3rd. South Yorkshire is quite far down the list.
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CAA's own figures for 2022 there are still 4.8m+ passengrrs from Yorkshire & Humberside (3.7m), North East (0.4m),the
East Midlands (0.7m) & East of England (0.4m) leaking across the Pennines to MAN - they are some of the people who will use DSA if it can get an operator of standing installed to encourage airlines like Easy, Ryanair, TUI, Wizz and who knows maybe even Jet 2 to take some of that market that likes to avoid LBA.
if it can get an operator of standing installed to encourage airlines like Easy, Ryanair, TUI, Wizz and who knows maybe even Jet 2 to take some of that market that likes to avoid LBA.
LBA had 4 million pax in 2023, making it 13th busiest airport in the UK. A long way down from the biggest LCC airports in the UK. Compared to LCCs at Manchester, Jet2 are probably seeing good but not exceptional economies of scale at LBA. Jet2 do not follow an "outsource everything to the cheapest bidder" approach - this increases in-house costs and works only where there are decent economies of scale.
I'm dubious that the south Yorkshire via DSA market could provide those economies of scale without substantially cannibalising DSA or EMA
I'm dubious that the south Yorkshire via DSA market could provide those economies of scale without substantially cannibalising DSA or EMA
Simple answer... Jet2. Without the number of aircraft they base and the choice of destinations they offer Leeds would have not have had the same success.
CAA's own figures for 2022 there are still 4.8m+ passengrrs from Yorkshire & Humberside (3.7m), North East (0.4m),the
East Midlands (0.7m) & East of England (0.4m) leaking across the Pennines to MAN - they are some of the people who will use DSA if it can get an operator of standing installed to encourage airlines like Easy, Ryanair, TUI, Wizz and who knows maybe even Jet 2 to take some of that market that likes to avoid LBA.
CAA's own figures for 2022 there are still 4.8m+ passengrrs from Yorkshire & Humberside (3.7m), North East (0.4m),the
East Midlands (0.7m) & East of England (0.4m) leaking across the Pennines to MAN - they are some of the people who will use DSA if it can get an operator of standing installed to encourage airlines like Easy, Ryanair, TUI, Wizz and who knows maybe even Jet 2 to take some of that market that likes to avoid LBA.
Think the point was that they couldn’t pinpoint a significant focussed demand for destinations. That is the challenge anyone who operates reopened airport will face. Not to mention that squeeze on slots across the Mediterranean which is the bread and butter of any airport like DSA.
Last edited by pug; 15th Feb 2024 at 16:12.