BAA "slashes" GLA charges
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BAA "slashes" GLA charges
From The Herald, 11/12/02, available at www.theherald.co.uk
BAA slashes Glasgow charges to encourage more winter trade
KEN SYMON
BAA is offering to cut charges to airlines using Glasgow airport by 19% during the slack winter months in a bid to open up more international services from Scotland.
Donal Dowds, the managing director of Scottish Airports, the BAA subsidiary which manages Edinburgh, Glasgow and Aberdeen airports announced the discounts at an unpublicised meeting with the airlines last week.
The price cut across the board on services offered by Glasgow airport is a bold move in response to the increasing pressure on airlines to cut costs.
Dowds told The Herald: "We are talking about how we share the risk with the carriers on the start-up of these services."
The exact cost of the discounts is hard to quantify, but the initiative will use the bulk of the £60m earmarked by BAA over the next five years to boost international air services from Scotland.
The Scottish executive said recently that it was allocating £6m to help set up new direct air services from Scotland to overseas destinations, but how that money is to be spent has not yet been announced.
Dowds said he is currently in discussions with eight airlines about new low cost services from Glasgow. He refused to name the carriers, but said the destinations under consideration included Geneva, Zurich, Hamburg, Stockholm, Oslo, Munich, Palma, Barcelona, Malaga and Alicante.
An airline industry source said he was also talking to US Airlines about a service to Philadelphia.
Dowds' strategy is to focus tariff discounts on the winter months - outside the April to October holiday period which accounts for 84% of Glasgow's passenger traffic.
He said: "We are going to focus all of that additional discount into international services, all of it into the winter period.
"I think that is a very significant decrease and I think it will attract the interest of international airlines, particularly when you see it alongside the attractive packages for starting up routes.
"The benefit of this discount is that all international carriers will get it, not just the new start-ups, so it shares the benefit with the existing carriers who have been maintaining international travel through Glasgow for many years. I think that's important."
British Airways, whose only international service from Scotland is a thrice-daily connection from Edinburgh to Paris, was guarded in its reaction. A spokeswoman said the airline was always looking for new opportunities, but added: "We don't have any current plans to operate any more direct services to Europe from Scottish airports."
EasyJet, which already flies from Glasgow to Luton, Stansted, Belfast and Amsterdam welcomed the tariff cut. But a spokesman said BAA could still do more to make Glasgow an attractive base for international services by offering more basic passenger facilities at an even lower cost. "All we need is a shed and a couple of checkout desks and we'd be away," he said.
Dowds said: "So we are being radical, we are doing things quite differently ... It will be interesting to see how the market responds in the months ahead."
The 19% discount will be offered across the board on the menu of services of Glasgow airport, ranging from runway landing fees to terminal use and refuelling.
The actual charges in each case will depend on how long the aircraft is on the ground, which pier it uses and whether refuelling is involved.
More than seven million passengers use Glasgow airport each year, but passenger traffic continues to increase and industry sources have said that it will soon approach the airport's current capacity of 8.5 million passengers.
Dowds said BAA was preparing plans to invest a further £200m over five years to further expand the airport's passenger terminal.
One of the catalysts for the tariff-cutting initiative was Glasgow losing out to Newcastle in October, when easyJet said it planned to launch three new European services from Tyneside.
Dowds said: "Our business challenge is different from other airports that are half to three-quarters empty and that have sunk capital after privatisation and are chasing cashflow. That's one of the challenges that we face - there are people out there prepared to offer uneconomic prices simply to generate cashflow."
Currently in talks with "EIGHT" airlines about new lo-co services!!!???
I'm getting cynical in my old age, but what's the bet that nothing comes of this (as usual)!
BAA slashes Glasgow charges to encourage more winter trade
KEN SYMON
BAA is offering to cut charges to airlines using Glasgow airport by 19% during the slack winter months in a bid to open up more international services from Scotland.
Donal Dowds, the managing director of Scottish Airports, the BAA subsidiary which manages Edinburgh, Glasgow and Aberdeen airports announced the discounts at an unpublicised meeting with the airlines last week.
The price cut across the board on services offered by Glasgow airport is a bold move in response to the increasing pressure on airlines to cut costs.
Dowds told The Herald: "We are talking about how we share the risk with the carriers on the start-up of these services."
The exact cost of the discounts is hard to quantify, but the initiative will use the bulk of the £60m earmarked by BAA over the next five years to boost international air services from Scotland.
The Scottish executive said recently that it was allocating £6m to help set up new direct air services from Scotland to overseas destinations, but how that money is to be spent has not yet been announced.
Dowds said he is currently in discussions with eight airlines about new low cost services from Glasgow. He refused to name the carriers, but said the destinations under consideration included Geneva, Zurich, Hamburg, Stockholm, Oslo, Munich, Palma, Barcelona, Malaga and Alicante.
An airline industry source said he was also talking to US Airlines about a service to Philadelphia.
Dowds' strategy is to focus tariff discounts on the winter months - outside the April to October holiday period which accounts for 84% of Glasgow's passenger traffic.
He said: "We are going to focus all of that additional discount into international services, all of it into the winter period.
"I think that is a very significant decrease and I think it will attract the interest of international airlines, particularly when you see it alongside the attractive packages for starting up routes.
"The benefit of this discount is that all international carriers will get it, not just the new start-ups, so it shares the benefit with the existing carriers who have been maintaining international travel through Glasgow for many years. I think that's important."
British Airways, whose only international service from Scotland is a thrice-daily connection from Edinburgh to Paris, was guarded in its reaction. A spokeswoman said the airline was always looking for new opportunities, but added: "We don't have any current plans to operate any more direct services to Europe from Scottish airports."
EasyJet, which already flies from Glasgow to Luton, Stansted, Belfast and Amsterdam welcomed the tariff cut. But a spokesman said BAA could still do more to make Glasgow an attractive base for international services by offering more basic passenger facilities at an even lower cost. "All we need is a shed and a couple of checkout desks and we'd be away," he said.
Dowds said: "So we are being radical, we are doing things quite differently ... It will be interesting to see how the market responds in the months ahead."
The 19% discount will be offered across the board on the menu of services of Glasgow airport, ranging from runway landing fees to terminal use and refuelling.
The actual charges in each case will depend on how long the aircraft is on the ground, which pier it uses and whether refuelling is involved.
More than seven million passengers use Glasgow airport each year, but passenger traffic continues to increase and industry sources have said that it will soon approach the airport's current capacity of 8.5 million passengers.
Dowds said BAA was preparing plans to invest a further £200m over five years to further expand the airport's passenger terminal.
One of the catalysts for the tariff-cutting initiative was Glasgow losing out to Newcastle in October, when easyJet said it planned to launch three new European services from Tyneside.
Dowds said: "Our business challenge is different from other airports that are half to three-quarters empty and that have sunk capital after privatisation and are chasing cashflow. That's one of the challenges that we face - there are people out there prepared to offer uneconomic prices simply to generate cashflow."
Currently in talks with "EIGHT" airlines about new lo-co services!!!???
I'm getting cynical in my old age, but what's the bet that nothing comes of this (as usual)!
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Quite agree, it's hard not to be anything but cynical when it comes to BAA press releases.
One thought though: Why do they only want to cut the charges through the winter period, it should be uniform cut across the whole year.
Anyway, standing by for the next conspiracy theory.
One thought though: Why do they only want to cut the charges through the winter period, it should be uniform cut across the whole year.
Anyway, standing by for the next conspiracy theory.
