A new airport.... South Yorkshire Airport City?

Doncaster Sheffield Airport Strategic Review Announcement​

Forums4airports discusses the latest press release from Doncaster Sheffield airport where the airport questions the future of the airport. The owners of the airport, the Peel Group have announced they are looking at their options as the group has decided the airport is no longer viable as an operational airport. Here's the press release:

"The Board of Doncaster Sheffield Airport (DSA) has begun a review of strategic options for the Airport. This review follows lengthy deliberations by the Board of DSA which has reluctantly concluded that aviation activity on the site may no longer be commercially viable.

DSA’s owner, the Peel Group, as the Airport’s principal funder, has reviewed the conclusions of the Board of DSA and commissioned external independent advice in order to evaluate and test the conclusions drawn, which concurs with the Board’s initial findings.

Since the Peel Group acquired the Airport site in 1999 and converted it into an international commercial airport, which opened in 2005, significant amounts have been invested in the terminal, the airfield and its operations, both in relation to the original conversion and subsequently to improve the facilities and infrastructure on offer to create an award winning airport.

However, despite growth in passenger numbers, DSA has never achieved the critical mass required to become profitable and this fundamental issue of a shortfall in passenger numbers is exacerbated by the announcement on 10 June 2022 of the unilateral withdrawal of the Wizz Air based aircraft, leaving the Airport with only one base carrier, namely TUI.

This challenge has been increased by other changes in the aviation market, the well-publicised impact of the COVID-19 pandemic and increasingly important environmental considerations. It has therefore been concluded that aviation activity may no longer be the use for the site which delivers the maximum economic and environmental benefit to the region. Against this backdrop, DSA and the Peel Group, will initiate a consultation and engagement programme with stakeholders on the future of the site and how best to maximise and capitalise on future economic growth opportunities for Doncaster and the wider Sheffield City Region.

The wider Peel Group is already delivering significant development and business opportunities on its adjoining GatewayEast development including the recent deal for over 400,000 sq ft logistics and advanced manufacturing development on site, creating hundreds of new jobs and delivering further economic investment in the region.

Robert Hough, Chairman of Peel Airports Group, which includes Doncaster Sheffield Airport, said: “It is a critical time for aviation globally. Despite pandemic related travel restrictions slowly drawing to a close, we are still facing ongoing obstacles and dynamic long-term threats to the future of the aviation industry. The actions by Wizz to sacrifice its base at Doncaster to shore up its business opportunities at other bases in the South of England are a significant blow for the Airport.

Now is the right time to review how DSA can best create future growth opportunities for Doncaster and for South Yorkshire. The Peel Group remains committed to delivering economic growth, job opportunities and prosperity for Doncaster and the wider region.”

DSA and the Peel Group pride themselves on being forward-thinking whilst prioritising the welfare of staff and customers alike. As such, no further public comments will be made whilst they undertake this engagement period with all stakeholders.
During the Strategic Review, the Airport will operate as normal. Therefore passengers who are due to travel to the airport, please arrive and check in as normal. If there are any disruptions with your flight, you will be contacted by your airline in good time.
For all press enquiries, please contact Charlotte Leach at [email protected]."

"Not great news for DSA or the region"

Should the government or local council foot the bill and provide a financial subsidy to keep the airport open, thoughts...?

 

Doncaster Airport could re-open after Council offered lease to run airport

Doncaster Council confirmed on Friday that they had been offered a lease to operate it by site owners Peel

www.examinerlive.co.uk

I’m not sure why the press didn’t run with this before, as it’s quite old news. Perhaps trying to garner support and apply pressure to take the leasehold option. Recipe for disaster.

 

I think Peel have got the Council in a check mate situation.

The lease costs will no doubt be weighted.
Then there is the costs of buying new equipment to replace whats been sold and being specialised pieces of equipment won't come cheap.

So absolutely vast costs before an aircraft operates.

 

The worry is the council don't see the trap and plough on wasting even more public money. The whole thing has be a complete publicity stunt from day one fed by various councillors over-inflated ego, sadly at the cost of significant amounts of your council tax. Councils have no money to spend on actual things like social services, but amazing find millions to spaf away on stupidity like this.

 

I’m not sure why the press didn’t run with this before, as it’s quite old news. Perhaps trying to garner support and apply pressure to take the leasehold option. Recipe for disaster.

I did read that the leasehold had been offered quite some time ago (can't put my finger on where) but as has been stated, it wasn't a big story in the press.

I think Peel have got the Council in a check mate situation.

The lease costs will no doubt be weighted.
Then there is the costs of buying new equipment to replace whats been sold and being specialised pieces of equipment won't come cheap.

So absolutely vast costs before an aircraft operates.

An interesting situation. It seems that the Council intention would be to take the leasehold and sub-lease to an 'airport operator' who would, one assumes, return the airfield to operational status but at great capital cost. The Council gets the airport open at no ongoing cost to themselves assuming the charge they make for the sub lease is at least equal to the amount that they pay Peel! BUT the difficulty I would think will be attracting an 'operator' prepared to take on what would seem to be a massively risky project evidenced by history since the airfield opened, paying a substantial lease and sinking a huge amount of funds into something that they do not own plus losing large amounts in operating costs at least in the short term even if they can persuade anyone to operate there. On the balance of probabilities you would think it will not happen. Peel offering the lease to the Council would be some mitigation against the CPO which the Council I see have said will cost £3.1 million. As you say Council (under pressure from a (relatively) small group of local holiday makers) in a very difficult position.

 

So absolutely vast costs before an aircraft operates.

What aircraft? If the Council take up the lease, which airlines are they going to tempt? If airlines had been knocking on the door of DSA previously, then it wouldn't have closed.

 

What aircraft? If the Council take up the lease, which airlines are they going to tempt? If airlines had been knocking on the door of DSA previously, then it wouldn't have closed.

This is it, before the airport opened it was sold as set in stone that easyjet would be one of the main operators. In reality this didn’t actually happen, least not on in any quantifiable way. Is this a Peel issue or a market issue? That to me is the big question, if a new operator could get easyjet in, with initial 3 based aircraft then we might be talking longevity, let’s face it they have no real presence in this side of the U.K. between Luton and Edinburgh! If not then there is simply no argument to reopen, and I question how the council have concluded that the airport is viable.

 

This is it, before the airport opened it was sold as set in stone that easyjet would be one of the main operators. In reality this didn’t actually happen, least not on in any quantifiable way. Is this a Peel issue or a market issue? That to me is the big question, if a new operator could get easyjet in, with initial 3 based aircraft then we might be talking longevity, let’s face it they have no real presence in this side of the U.K. between Luton and Edinburgh! If not then there is simply no argument to reopen, and I question how the council have concluded that the airport is viable.

I can't imagine how any airline other than the two who survived to the end at DSA would ever take the risk of opening a base at a reopened DSA, especially airlines who did go in previously and failed. They know the market, they know why DSA failed and they know there's a high risk it will again for all the same reasons.

As for an airport operator, if they take this on, then frankly, they are nuts. Huge costs, and staffing up an entire airport again isn't going to be easy given the shortages within the industry. Long established airports struggle to get all the staff needed, Swissport have only just closed down DSA so won't be too happy at having to recruit again, and with no guarantee of airlines or success .

Someone in the industry needs to give the Doncaster mayor and various MPs a good shaking and explain to them their responsibilities towards the people dont include spending, and probably wasting, millions on a vanity project.

 

Just over a month to the local elections.......I wonder if things will all go quiet after that!

 

I can't imagine how any airline other than the two who survived to the end at DSA would ever take the risk of opening a base at a reopened DSA, especially airlines who did go in previously and failed. They know the market, they know why DSA failed and they know there's a high risk it will again for all the same reasons.

As for an airport operator, if they take this on, then frankly, they are nuts. Huge costs, and staffing up an entire airport again isn't going to be easy given the shortages within the industry. Long established airports struggle to get all the staff needed, Swissport have only just closed down DSA so won't be too happy at having to recruit again, and with no guarantee of airlines or success .

Someone in the industry needs to give the Doncaster mayor and various MPs a good shaking and explain to them their responsibilities towards the people dint include spending, and probably wasting, millions on a vanity project.

Problem is, if the council have consulted airlines is it really likely that an airline would say that they are not interested in operating from DSA? I doubt it. More than likely they would trot out the usual non-comital line such like ‘we are always exploring new routes and destinations’. The Council will not be aware of the amount of work that goes in to attracting new routes, let alone the huge investment of opening a base, they will therefore not read between the lines. After all, they are also of the opinion that Peel have not explored all opportunities fully.

Finger66, I’m led to believe there are no local elections this year, 2024 for council and 2025 for SYMCA. Am I wrong in that?

 

The local politicians have created the problem in that for over 25 years they have been telling themselves and the local electorate that DSA is a key element in regenerating the regional economy following the demise of the coal industry and contraction of the steel industry. Now it has been shown that the airport isn’t viable they are in trouble of their own making.

South Yorkshire is no longer a Labour fortress, there are now ‘Red Wall’ Tory seats in the area. The Tories cannot claim that Labour politicians are wasting public money by supporting an unviable airport. Similarly, Labour can point to Teesside where a Tory Mayor, encouraged by a Tory government, has bought an airport which Peel considered to be unviable and is pumping public money into it.

The politicians have created a problem and the loser will be the taxpayers.

 

The local politicians have created the problem in that for over 25 years they have been telling themselves and the local electorate that DSA is a key element in regenerating the regional economy following the demise of the coal industry and contraction of the steel industry. Now it has been shown that the airport isn’t viable they are in trouble of their own making.

South Yorkshire is no longer a Labour fortress, there are now ‘Red Wall’ Tory seats in the area. The Tories cannot claim that Labour politicians are wasting public money by supporting an unviable airport. Similarly, Labour can point to Teesside where a Tory Mayor, encouraged by a Tory government, has bought an airport which Peel considered to be unviable and is pumping public money into it.

The politicians have created a problem and the loser will be the taxpayers.

If they do take the lease option - let’s face it that is the scenario most likely to see the airport reopen - then it will provide the de-facto determining factor as to whether the airport is viable or not. You could have a charitable organisation throw millions at it and still have it be in the same situation. It will need to pay its way whether it’s a private sector owner or a public sector backed operator. As outlined above, if they can’t attract the airline and freight business to make it pay then it will be gone in a few years anyway, and the tax-payer will be out of pocket.

 

According to Peel, anything less than 2.5m pax annually equates to a loss. Frankly it's hard to see where such numbers would come from. LBA handles as many as 60 flights per day in summer (120 movements) and still only achieves circa 3.5 - 4 m per year. DSA often struggled to get a daily flight number in double figures. Seems like a loss waiting to happen.

 

According to Peel, anything less than 2.5m pax annually equates to a loss. Frankly it's hard to see where such numbers would come from. LBA handles as many as 60 flights per day in summer (120 movements) and still only achieves circa 3.5 - 4 m per year. DSA often struggled to get a daily flight number in double figures. Seems like a loss waiting to happen.

Could go one of two ways. New operator has a realistic expectation of natural growth potential that is much lower than 2.5mppa and service levels are reduced to keep overheads manageable. Or, new operator has the industry clout to be able to attract airline partners that Peel was lacking, airlines with established brands and a pull factor. This brings me back to easyjet, and I think they are, much like Jet2, very cautious not to provide overlap in service provisions and take on board the high costs associated with this. TUI did well from DSA because they all but abandoned LBA and HUY, their brand carried them. Just couldn’t be replicated, not even by Wizzair U.K. who had an established brand at DSA. In fact, load factors on the short lived routes on the based aircraft were shocking! Easyjet do not operate from Yorkshire short of a few flights per week to BFS from LBA, they do not have a base up the M1/A1 corridor between LTN and EDI, yet they have remained ambivalent to DSA. This is either due to poor catchment area and/or they are unwilling to sacrifice their large base at MAN. Had DSA opened ten years earlier things could have been very different, as it is LPL gets a legacy presence.

As you will all know, I remain skeptical. I feel it’s healthy in this debate to be objective in the face of the nonsense that gets posted elsewhere, however I do think the council are walking in to this willingly and taking their tax payers money with them, so at the moment it is highly likely that something will happen soon one way or another.

 

Could go one of two ways. New operator has a realistic expectation of natural growth potential that is much lower than 2.5mppa and service levels are reduced to keep overheads manageable. Or, new operator has the industry clout to be able to attract airline partners that Peel was lacking, airlines with established brands and a pull factor. This brings me back to easyjet, and I think they are, much like Jet2, very cautious not to provide overlap in service provisions and take on board the high costs associated with this. TUI did well from DSA because they all but abandoned LBA and HUY, their brand carried them. Just couldn’t be replicated, not even by Wizzair U.K. who had an established brand at DSA. In fact, load factors on the short lived routes on the based aircraft were shocking! Easyjet do not operate from Yorkshire short of a few flights per week to BFS from LBA, they do not have a base up the M1/A1 corridor between LTN and EDI, yet they have remained ambivalent to DSA. This is either due to poor catchment area and/or they are unwilling to sacrifice their large base at MAN. Had DSA opened ten years earlier things could have been very different, as it is LPL gets a legacy presence.

As you will all know, I remain skeptical. I feel it’s healthy in this debate to be objective in the face of the nonsense that gets posted elsewhere, however I do think the council are walking in to this willingly and taking their tax payers money with them, so at the moment it is highly likely that something will happen soon one way or another.

But Easyjet did go into DSA and they quit again - so they did give it a chance. In fact they gave it more if a chance than they have done at LBA, where they operated Geneva for a few years in winter, then left, and now Belfast International. Nobody can claim Peel didn't attract airlines. They got easyJet, Ryanair, TUi, Wizz Europe, Wizz UK, Flybe, Aer Lingus , the MAN Islamabad flights for a few months, and others. How they attracted them only Peel know, but the fact is that all but two left. Few had really good loads. Obviously they didn't make money and off they went.

 

But Easyjet did go into DSA and they quit again - so they did give it a chance. In fact they gave it more if a chance than they have done at LBA, where they operated Geneva for a few years in winter, then left, and now Belfast International. Nobody can claim Peel didn't attract airlines. They got easyJet, Ryanair, TUi, Wizz Europe, Wizz UK, Flybe, Aer Lingus , the MAN Islamabad flights for a few months, and others. How they attracted them only Peel know, but the fact is that all but two left. Few had really good loads. Obviously they didn't make money and off they went.

I know, and like I mentioned previously the Wizz U.K. loads were shocking, many not even reaching 50%. I know it was just after Covid, but they make decisions on forward bookings and if they are not selling at a good rate they get the chop.

I think easyjet only went in to DSA to keep Peel happy, certainly when they opened the base anyway. As I seem to recall at the time there was quite a lot of easyjet growth at MAN and Peel had a growth agreement with easyjet for their LPL base. Perhaps Peel did upset them? But then the load factors were below 70% on average which is below their profitable load factors of the time at something like 86% average.

I believe Ryanair showed interest two years ago in basing one aircraft and were rebuffed by Peel, this is why people suggest they turned business away. This is only half the story, clearly Ryanair wanted to see off Wizz U.K., after which they would have pulled out anyway. Also the terms for the one aircraft deal would have been a loss leader for the airport. Obviously DSA wanted to protect Wizz U.K. as at the time they were to base 3 aircraft as part of the agreement, this obviously never materialised and the agreed rates were probably therefore voided. People clearly don’t understand how much it costs to handle these aircraft, this is why Peel talk of critical mass, it’ll be like a bell curve, where it costs the airport money until such passenger numbers are reached whereby the revenue from car parking and retail starts to cover the costs of handling the flights. For airports like DSA, the airlines hold all the cards. So if the passengers don’t show their support by buying enough tickets the whole thing falls apart. This was Peels business model throughout and it has only worked at LPL.

 

A lot of this has similarities to Flybe in my eyes. It didn't work first time around so why on earth would anyone think it will work the second? The numbers just won't, and don't, add up

 

A lot of this has similarities to Flybe in my eyes. It didn't work first time around so why on earth would anyone think it will work the second? The numbers just won't, and don't, add up

Never underestimate the power of local pride where airports are concerned. ‘We are a city, we can’t be a city without an airport’ is the order of the day. A city with an urban population of just over 100,000 and a metropolitan population of around 300,000. South Yorkshire population 1.2million, which is large, but that is 1.2million people within an hour of at least two other airports. Airlines don’t care how long it takes you to get to Manchester, so long as you continue doing so they don’t need to invest £millions more in creating new bases. That is the reality, if another operator can come in and get the business then they have my support 100%, but I’m not holding my breath.

 

And of those 1.2m population how many:
A) have a need to fly
B) have the means to fly
C) want to go to the limited destinations that would likely be on offer
D) would still fly from another airport
Please don't think I am having a go here because I am not, but the stark reality is the airport is unviable - the airlines have seen and experienced this in the past and pax numbers told their own story. We all have pride when it comes to our local airport and some of us are very fortunate that we have a very successful one on our doorstep. The DSA infrastructure with the LBA pax in a less hilly location would be a match made in heaven for Yorkshire

 

Sounds like the approach lights are being removed from one end today. Of course Mark Chadwick is all over it saying that it’s in agreement with the council. This has been rubbished elsewhere.

 

Doncaster Sheffield reopening takes step forward as £3.1m pledged | Travel Weekly

Council makes preparations for Compulsory Purchase Order

travelweekly.co.uk