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...?

 

there track record in airports is pretty poor, . peel have 45% in LPL, ok . but sheffield, teeside if you take a quote from guy shrubsole book-Peel Holdings operates behind the scenes, quietly acquiring land and real estate, cutting billion-pound deals and influencing numerous planning decisions. Its investment decisions have had an enormous impact, whether for good or ill, on the places where millions of people live and work.There is clear evidence for this in the closure of DSA (Doncaster Sheffield Airport) and Peel's resistance to anybody else owning or running it as a viable airport. There's a proactive campaign and endeavours by the South Yorkshire metropolitan area (and SY Combined Mayoral Authority) to this simply being "sat on" by Peel to increase its land value and/or split up the former RAF base (and one of the longest runways in the UK). This tactic was deployed in the brief Sheffield Airport where Peel closed it down and asset stripped it into warehouse units on the land, thereby destroying its ability to ever resume as an airport.

Their track record on airport purchase decision making is largely poor, but their track record on facilitating phenomenal growth at LPL is not. Sheffield they purchased strategically to close to shore up support for DSA, and also because they knew it would be unviable as an airport.

They built DSA, they invested £250m of their own money into it. They appointed some of the best in the business to run it, they offered huge subsidies to airlines to operate from there and agreed significant marketing deals to support it. They also ran out of options after poor customer support. Teesside was a poor choice of purchase and they did so on the proviso that undercutting competition and generating revenue through volume would work. It didn’t because the airports they were supposed to undercut, and they airlines they were trying to attract, all matured.

Peel have not resisted anyone else owning it, they have been in talks with interested investors (of which there were not many) who offered them below their asking price to take it from them. They have stuck to their guns and agreed to lease the site to the council which would not have happened had they been as you say, keen to split up the land and sell by the lot.

It is not one of the longest runways in the U.K. regardless, plenty of longer runways now sit under housing and industrial developments.

Although not directly related it could be argued it could be seen as catalyst to growth and as an economic indicator?

One of the issues Peel had with their proposals to change use was the investors they had in mind were not interested in setting up shop on the estate. Not sure who they expect will be taking residency on this ‘advanced manufacturing’ site. But whatever it is, be it high end R&D or more warehouses, it will do nothing for the airlines.

 

you are wrong when you say Peel have not resisted anyone else owning it.

https://www.bbc.co.uk/news/uk-england-south-yorkshire-64270773*0

on another note ,peel are still involved in the £1.7 billion delevopment in gatewayeast.

 

you are wrong when you say Peel have not resisted anyone else owning it.

https://www.bbc.co.uk/news/uk-england-south-yorkshire-64270773*0

on another note ,peel are still involved in the £1.7 billion delevopment in gatewayeast.

No im not. They have actively been in talks with at least one private sector investor who were rejected due to the low offer and spurious source of funds. You’ve posted a dead link.

Yes Peel are still involved, the cynics amongst us wonder how much more political favours they have gained by leasing a lame duck and proven money pit to the local authority.

 

https://www.bbc.co.uk/news/uk-england-south-yorkshire-64270773 sorry did not coply link right

 

https://www.bbc.co.uk/news/uk-england-south-yorkshire-64270773 sorry did not coply link right

The council have £138million available through gainshare. That falls way below the asking price, and as there wasn’t much industry support the site isn’t worth that as an airport. It’s not evidence that Peel have been unwilling to sell.

 

Following our lease announcement last month, we have heard from TUI that they are keen to return to our airport, we have kept in regular contact with them since the structural review of the former DSA site was announced. 0
Their spokesman has told us: “TUI has always supported Doncaster Sheffield Airport, proudly flying customers from the region and were disappointed when the airport closed. Doncaster Sheffield Airport delivered a fantastic airport experience for our customers, and we are excited about actively engaging with stakeholders about a potential re-opening.”
”

We have engaged TUI with the bidders for their return to our airport to be explored and we are hopeful that we will see TUI back in Doncaster! so i do not see them jumping the gun0

 

Following our lease announcement last month, we have heard from TUI that they are keen to return to our airport, we have kept in regular contact with them since the structural review of the former DSA site was announced. 0
Their spokesman has told us: “TUI has always supported Doncaster Sheffield Airport, proudly flying customers from the region and were disappointed when the airport closed. Doncaster Sheffield Airport delivered a fantastic airport experience for our customers, and we are excited about actively engaging with stakeholders about a potential re-opening.”
”

We have engaged TUI with the bidders for their return to our airport to be explored and we are hopeful that we will see TUI back in Doncaster! so i do not see them jumping the gun0

You are aware of commercial confidentiality aren’t you? They’ve just made public TUI plans to negotiate a return. Whilst I’m sure both bidders interested in running the airport would be keen to see TUI return, it will have to be so on commercially agreed terms that suit both parties. By publicly announcing the intention it either confirms that TUI don’t believe there will be much competition upon returning, or the council have jumped the gun by making it public, the purpose of which is blatant electioneering. They should be withholding this information until such a time that the operator is in place and has had chance to have meaningful discussions on a way forward.

If it reopens as was, it’ll only kick the can down the road. This was the whole point and why the airport closed before, because TUI and Wizz alone could not generate sufficient passenger numbers to sustain the operation.

The business plan of the winning bidder will be scrutinised at a regional and possibly central government level to ensure tax payers aren’t getting a bad deal/they aren’t eventually going to be tied to subsidising the airport. As I know from industry experience how much DSA was charging in agreed rates before, yet still didn’t manage to attract and retain a good spread of passenger and freight ops, I wonder what the problem was if it wasn’t lack of airline confidence in the market? That doesn’t change based on ownership models, it’s a fundamental requirement for an airport to be successful.

 

i just think, with the massive construction projects goinging on around the airport a lot of companies have some faith in DSA being a a vaiable business. air cargo , as increased 10 % in the UK ,and that is one of the few advantages DSA as over LBA. doncaster as become one of the biggest distrubtion centers in the uk. DSA as to do a lot of catching up to LBA, but LBA had over a 50 year start.

 

i just think, with the massive construction projects goinging on around the airport a lot of companies have some faith in DSA being a a vaiable business. air cargo , as increased 10 % in the UK ,and that is one of the few advantages DSA as over LBA. doncaster as become one of the biggest distrubtion centers in the uk. DSA as to do a lot of catching up to LBA, but LBA had over a 50 year start.

I don’t think the construction projects mean anything, they’d happen whether there was an airport or not.

Air freight might have grown, but most of that is growth in belly hold on passenger aircraft and therefore not a market DSA is ever likely to be able to enter. Pure freight is growing at EMA, just last week another frequent route has been introduced. EMA is a few minutes flying time from DSA and is successful due to its central location. Investment in facilities necessary to replicate that success is not viable.

LBA has a core catchment area of around 2.5 million, completely different kettle of fish.

As I’ve used DSA in the past on numerous occasions, I am by virtue of that a stakeholder. The airport was great to use, but whilst it was open I used other airports more. The staff and facilities made it what it was, and I hope whatever happens they find something else worthwhile to do be it at a reopened DSA or elsewhere. However, the last thing we need to see is the airport reopen and close again, it’s not going to do anyone any favours.

This push to reopen is all based on the assumption that the previous operators didn’t know what they were doing, and that is horse sh*t.

 

TUI has always supported Doncaster Sheffield Airport, proudly flying customers from the region and were disappointed when the airport closed.

This statement sounds very much like what Jet2 said about Blackpool airport when it closed. The difference here is Phillip Meeson went on to say he didn't believe BLK airport would reopen and he said they had reinvested in other airports.

Following the closure of DSA TUI did the same and reinvested in other airports. I would be very supprised to see that reinvestment pulled from the likes of EMA and MAN and placed back into DSA. That would come at a considerable cost to them and without a secure future it will be an incredibly risky move for them.

Reported elsewhere TUI is interested in a return to DSA (not a shock) as expected how many AC are we likely to see? 3? 4? nothing new nothing no mention of any other interested operators. the airport couldn't turn a profit before. literally cant see anything different happening..

If this is true, they will want a deal that replicated what they had previously as a minimum. That will be a problem for the council as the previous deal didn't allow the airport to turn a profit. It will be reliant on gaining other airlines to make up the shortfall which will be an up hill struggle for them.

 

The airport’s owners, the Peel Group, today announced they would be winding down operations from the week commencing 31 October.
But the South Yorkshire Mayoral Combined Authority and Doncaster Council have offered to cover the airports operating losses for up the 13 months while a buyer is found.
The Peel Group has turned the offer down, saying it cannot ‘responsibly accept public money’ -

that statement is where i disagree with your the assumption that the previous operators didn’t know what they were doing, and that is horse sh*t.
what company would turn down that offer!!
"we will cover your losses while you find a buyer"
and peels track record in running airports is very poor, as i said before.

 

I wait with interest to find out the situation after the forthcoming elections. There's so much blatant electioneering going on, seemingly aimed at securing lots of nice Labour votes, but once they're back in, then we will see what is really happening.

When asked recently if he was worried about future competition from DSA, the LBA CEO, who was heavily involved in Flybe's DSA base, and fully aware of the deal they got, said that DSA was run by 'good people', who knew the industry, but despite their best efforts, they were unable to keep any airline there in the longer term except TUi. That's because despite the extremely generous subsidies paid to airlines to get them there, none made any money. Ryanair, Easyjet, Wizz UK, Flybe and various others came and went.

So, what can a new operator do to attract airlines that Peel didn't do? They can't do any better than pay airlines to go there, so there'll be no change there. The biggest question is, what can airlines themselves do (if they go to DSA) to fill their aircraft day in day out, week in week out, and create a viable operation. History suggests they can't. The competition from MAN, LBA, EMA etc. is too great.

17 years of losses tells it's own story. It's hard to see any operator overcoming that or any airline creating a profitable operation there other than TUi and their dedicated band of followers . That's nowhere near enough for DSA mk 2 to survive. Any half decent operator will know this. The airlines will know this too. And so does the CEO at LBA who had no concerns at all about a new DSA.

 

I feel that this latest news release from Mayor Jones is a bit rushed out. I think she heard what was happening up the road at Teesside after Mayor Houchen's Live Q&A session. So thought best get something out in the media quick.

 

The airport’s owners, the Peel Group, today announced they would be winding down operations from the week commencing 31 October.
But the South Yorkshire Mayoral Combined Authority and Doncaster Council have offered to cover the airports operating losses for up the 13 months while a buyer is found.
The Peel Group has turned the offer down, saying it cannot ‘responsibly accept public money’ -

that statement is where i disagree with your the assumption that the previous operators didn’t know what they were doing, and that is horse sh*t.
what company would turn down that offer!!
"we will cover your losses while you find a buyer"
and peels track record in running airports is very poor, as i said before.

The company was ant risk of becoming insolvent. They could not keep trading in spite of any cash bundles being thrown their way. It’s irresponsible to accept public cash. They did apply for a loan from SYMCA who rejected it due to questions over the viability of the business, you can’t then throw a lifeline at the last minute in the hope that a buyer who is willing to invest £250million into a site that has failed might show up. It’s yet more political posturing knowing they had no influence but wanted to show they were doing something. See also the attempt to get a judicial review that was thrown out.

Peels track record of running airports is not poor. They made a poor decision to buy Teesside and a poor decision to build DSA (against expert advice) but actually their business model works when the airport is in a location with sufficient market, see LPL. You are aware of their dealings with BMIBaby at Teesside aren’t you? How they offered very attractive packages but they pulled out anyway because the passenger support was insufficient. Parallels with DSA.

 

i do not think the mayor needs to any electionerring, labour could put up a pig and it would win. the local conservative mp, is going without a doubt. and for the CEO to say he as no concerns, he would be a fool if he said he did. DSA will not be a threat to LBA, it is a well run airport, and as been for 50 years. one of the few advantages DSA as is the public are on the airport side, the links to it, and the vast space around it. LBA as the worst links to an airport in the uk, and always gets massive amounts of local people against exspansion .

The company was ant risk of becoming insolvent. They could not keep trading in spite of any cash bundles being thrown their way. It’s irresponsible to accept public cash. They did apply for a loan from SYMCA who rejected it due to questions over the viability of the business, you can’t then throw a lifeline at the last minute in the hope that a buyer who is willing to invest £250million into a site that has failed might show up. It’s yet more political posturing knowing they had no influence but wanted to show they were doing something. See also the attempt to get a judicial review that was thrown out.

peel do not accept public money?

in the salford project alone they accepted £490 million!!!

 

i do not think the mayor needs to any electionerring, labour could put up a pig and it would win. the local conservative mp, is going without a doubt. and for the CEO to say he as no concerns, he would be a fool if he said he did. DSA will not be a threat to LBA, it is a well run airport, and as been for 50 years. one of the few advantages DSA as is the public are on the airport side, the links to it, and the vast space around it. LBA as the worst links to an airport in the uk, and always gets massive amounts of local people against exspansion .
peel do not accept public money?
in the salford project alone they accepted £490 million!!!

With all due respect I think you need to learn to read what is being said. Peel could not in good faith accept any further public subsidy for a business that was at risk of becoming insolvent. What they get for other projects, and indeed gateway east, is irrelevant. They are separate entities. Of course the mayor needs to gain political capital, what a daft thing to say.

 

With all due respect I think you need to learn to read what is being said. Peel could not in good faith accept any further public subsidy for a business that was at risk of becoming insolvent. What they get for other projects, and indeed gateway east, is irrelevant. They are separate entities. Of course the mayor needs to gain political capital, what a daft thing to say.

sym candidates

Nick Allen, the Conservative candidate, said he would reopen Doncaster Sheffield Airport
David Bettney, the SDP candidate, is campaigning to reduce council tax, reopen Doncaster Sheffield Airport

a daft thing to say when they are all for DSA reopening in their campaigns. and i know who is going to win!

 

sym candidates

Nick Allen, the Conservative candidate, said he would reopen Doncaster Sheffield Airport
David Bettney, the SDP candidate, is campaigning to reduce council tax, reopen Doncaster Sheffield Airport

a daft thing to say when they are all for DSA reopening in their campaigns. and i know who is going to win!

What?? You do understand you have just proven my point don’t you?

 

With all due respect I think you need to learn to read what is being said. Peel could not in good faith accept any further public subsidy for a business that was at risk of becoming insolvent. What they get for other projects, and indeed gateway east, is irrelevant. They are separate entities. Of course the mayor needs to gain political capital, what a daft thing to say.

why in good faith peel would not accept public money ,when they had asked for a £20 million loan, this is a company with £1.8 billion

this is a quote from doncaster mp nick fletcher

Another smokescreen issue but from Peel this time. Peel said that the airport was not financially viable. The Council have commissioned two reports by EY consultants into this. The Mayor has said that both confirm the airport is financially viable.


Why would a massively wealthy company want a loan for £20m?

 

why in good faith peel would not accept public money ,when they had asked for a £20 million loan, this is a company with £1.8 billion

They had moved equity around the group as much as possible. In the end they were forced to approach SYMCA for either a loan or equity in the business in return for £20million. This was rebuffed by SYMCA under Dan Jarvis, SYMCA have been quick to remove the meeting minutes from their website however, wonder why. The request for public support was prior to Wizzair UK announcing plans to close their base at DSA though, when it was believed they had finally found that elusive airline partner who would deliver tangible growth and a route to profitability. When they pulled out, and having explored all opportunities with other airlines, the decision was made to close. Hence being unable to accept any further public money because the business had just taken a significant knock which meant it was no longer viable.