A lack of demand and a short runway mean commercially viable passenger services could not be run out of the former Plymouth Airport, a long-awaited government report has concluded.
A study by the Department for Transport (DfT) says: “There is no clear and consistent evidence across the reports to suggest that sufficient demand exists to operate commercially viable passenger services from a reopened PCA.”
And it questions the likelihood of general aviation users returning to a reopened airport, saying any such assumption was a commercial risk that would compound the airport’s “financial vulnerability”.
The report also reveals that a business plan by pressure group FlyPlymouth to reopen the airport – which has never been published but is based on general aviation use – relies on a £9 million government subsidy.
But in a clear signal not to expect a hand-out, the report says government policy is to support commercial competition between airports, rather than subsidise them.
It states: “In this context, future commercial decisions regarding PCA will be private matters for its owner, leaseholder, and other interested commercial parties.”
Jason Schofield, Chief Executive of Sutton Harbour Holdings plc, which owns the lease of the former airport site, said: “We are delighted that this long-awaited report has at last been issued. This is a thorough and independent report that has weighed the evidence and concluded that there is no evidence that commercially viable passenger services can be sustained from this site.
“This report completely undermines any rational argument for reopening an airport that is too small, and in the wrong place at a time when Government policy is focussed on facilitating market competition and where a good choice of existing airport facilities already exists in the South West region.
“Even those who wish to re-open it concede that they need a £9 million Government handout and their plan depends entirely on attracting general aviation users – essentially light aircraft enthusiasts not commercial operators – something the report identifies as a major risk. Whether these risks have been adequately explained to those members of the public who have given thousands of pounds to FlyPlymouth’s fundraising activities is unclear.
“But it comes as no surprise that FlyPlymouth has never actually published its business plan, and in particular has not revealed its funding plans or proposed sources of investment, because the Government’s report lays bare the Alice in Wonderland economics of their proposals.
“FlyPlymouth also told their quarterly public meeting in June that they were ‘wholly dependent’ on the outcome of the DfT report and that they would find it ‘very difficult to come back from a negative study’. We hope therefore that they accept its findings.
“We have long argued that the former airport site should be put to economic use to create jobs, homes and first class community sports facilities for the people of Plymouth. This report at long last settles that debate so the city can finally move on.”
The DfT study brings together the findings of nine previous reports commissioned by different parties on the potential to re-start commercial flights from the former airport site, which closed in December 2011 after falling demand and years of losses.
The DfT looked at three reports commissioned by the site’s freeholder Plymouth City Council; three by the site’s leaseholder Sutton Harbour Holdings plc; and two (including a business plan that has never been made publicly available in spite of repeated requests) by FlyPlymouth (formerly Viable), which has campaigned to re-open the airport.
The DfT review found:
- There is no clear and consistent evidence across the reports to suggest that sufficient demand exists to operate commercially viable passenger services from a reopened PCA
- A dependence on general aviation returning to a reopened airport compounded its ‘financial vulnerability’
- The short runway limits the range of aircraft and airlines that can operate, reducing potential destinations served and restricting demand
- There is a risk of ‘notable’ restrictions on payload and range of aircraft as a result
- Extending the runway would be too costly
- There is potential for even more constraints because of updated CAA safety laws
- Passenger numbers are unlikely to ever return to their peak
The report said the historic financial performance of Plymouth’s airport and the experience of other small airports suggested a “high risk environment” with a number of commercial risks for any future operator or airlines, limiting the airport’s viability.
These risks included a dependence on attracting general aviation users, something the DfT said would add to the “financial vulnerability” of a reopened airport. This included Royal Navy Flag Officer Sea Training (FOST) which has already made alternative arrangements since the airport closed five years ago this month.
The report notes that a FlyPlymouth business plan assumes it will receive a £4 million government loan to help cover acquisition costs, recommissioning costs and initial operational losses at a reopened airport, and assumes a further £5 million in government route subsidies for three years. This is despite ongoing claims by FlyPlymouth that they would reopen the airport without subsidy.
The report adds that securing a route to a London hub airport would be unlikely because of slot restrictions, with London City suggested as the only potential option. A key component of FlyPlymouth’s plan is a London City service, although the report notes that Air Southwest operated a London City route from Plymouth between 2009 and 2010, but it was scrapped after a year due to lack of demand and high costs. Direct flights to an expanded Heathrow or Gatwick are expected to remain too expensive to be commercially viable from Plymouth.
The DfT study was first announced by former Chancellor George Osborne as part of his March 2015 Budget.
The future of the former airport site will be determined by a planning inspector at an Examination in Public of the draft Plymouth and South West Devon Plan in the autumn of 2017, with the plan expected to be adopted shortly thereafter.
