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...?

 

a quote form OC

That’s why I have consulted with experts, airlines and even those sceptical of reopening DSA. All to make sure this is the right deal for the future of South Yorkshire.

so some airlines must have said they intend to fly from DSA, or he would not have ok the project

confirming they would look into DSA is completely different to actually fly from there. In the end DSA had 2 airlines. So let’s just say they are not flocking in are they.

Love to know which airlines they “think” would fly from DSA. Let’s break it down:

BA/Virgin/Emirates etc - no.
Jet2/Ryanair - publicly said no.
EasyJet - tried tested and failed before and getting into bed with LBA so no.
Loganair - no airlines shrinking
TUi - no AC on order, shrinking ACMI ops, maybe token gesture to start but will it be enough? Most likely not.
Wizz - apparently happy at LBA but cutting some routes, who knows? I still have doubts.
Eastern - recently few AC knocking about after KLM disappointment, if DSA pay them, no doubt they will fly some air from DSA..

What’s left? Not much choice or anything likely IMHO

 

LBA won’t comment on the plans to reopen as per the Yorkshire Post today;

Doncaster Sheffield Airport: Warning over 'critical risk' of potential legal challenge to £160m reopening plan

A potential legal challenge to the intended use of £160m of taxpayer money for the reopening of Doncaster Sheffield Airport represents a “critical risk” to the project, officials have warned South Yorkshire’s political leaders.

www.yorkshirepost.co.uk

This might signal that they’re watching closely and may be poised to launch a challenge if the papers confirm that there will be public subsidy for new routes. The outline document released on Monday quite clearly states that their intention is to displace flights from other airports, that’s how they justified the environmental impact.

As for airlines talking to Coppard. I do know that the commercial director at Eastern has been sticking his nose in, but by all accounts he’s a bit of a one anyway so I’d be tempted to disregard that!

 

Maybe just remind people of the below;

SW1A 0AA


8 September 2022


Dear Mr Merriman


Doncaster Sheffield Airport


Thank you for your letter dated 7th September 2022 regarding the announcement by the Peel


Group of the Strategic Review of options concerning the future of Doncaster Sheffield Airport


(DSA).


First of all, please let me reassure you that our immediate priority is to continue engaging with


our dedicated and hardworking employees at DSA and ensure the airport’s customers and


commercial partners are updated through every step of this Strategic Review. The Peel Group


remains open to working together with the political leadership both locally and nationally to


ensure that this review is conducted in a manner that produces the best outcome in the current


circumstances for the region at large.


I appreciate your understanding of the situation and would like to take this opportunity to clarify


some of the misleading information that has been made public during this review process.


Peel has striven tirelessly to achieve a viable operation at DSA, having invested £250m of


private capital into the airport over a period of 17 years. This has included the cost of


constructing the airport terminal, extensive runway repairs and other capital projects to


develop the airport’s capability. Apart from the Covid support provided by the Government


over the last two years, Peel has received just over £1m of UK public sector grant support for


the airport’s operations since opening in 2005.


Unfortunately, the investment has not led to the growth in traffic required to deliver a viable


operation. The regional aviation market has evolved in such a way that DSA has never made


a profit (its average EBITDA loss during the financial years 2014 to 2022 has been over £8m


per annum – excluding capital investment) and remains unable to reach the critical mass


required to sustain its passenger operations. This was compounded by Wizz Air’s decision in


March to pull out, leaving the airport with only one based airline, TUI.


Other major low-cost carriers such as Ryanair and EasyJet have all trialled aircraft at DSA


and subsequently chosen to establish bases at other regional airports due to a lack of


passenger demand at DSA. Notwithstanding DSA’s catchment area, over 18,000 people per


day on average have travelled across the Pennines by road and rail to use airports in the


Northwest of England, principally Manchester Airport. Only 3% of DSA’s passengers have


represented commercial/business passengers due to the dominance of leisure flights. Earlier


this year, a major freight carrier also declined to progress negotiations for a presence at DSA.


The result of these events and the high fixed costs associated with running a safe, regulated


airport means that there is no prospect of a break-even business plan in the near to medium


term future.


Despite your intimation, the Airport has not been within the top twenty of UK airports by


passenger numbers and has not been successful commercially.As such, following Wizz’s withdrawal decision and a detailed review of the forward prospects


for the airport, the Board of DSA reluctantly concluded that aviation activity may no longer be


viable. An independent review of the Board’s analysis was commissioned which also


concluded that the airport is unviable. The findings of this report concurred with those of South


Yorkshire Mayoral Combined Authority’s (SYMCA) own advisors who reviewed the financial


forecasts for the airport in 2021.


Although the Strategic Review announcement was made to stakeholders in July 2022, this


has been an ongoing situation on which Peel has regularly updated SYMCA and Doncaster


Council over the last two years, highlighting the financial challenges of the airport and seeking


assistance. Despite intensive endeavours on Peel’s part, SYMCA declined to invest any


amount for an equity stake in the airport or to make any loan to DSA to support its operational


losses. The airport’s current financial prospects mean that any loans provided, if offered now,


could not be repaid from the operations of the airport.


It is not only Peel which has been unable to build a sustainable business at DSA. Vantage


Airport Group, a global airport operator which owned a majority stake in DSA between 2010


and 2012, also came to the same conclusion and intended to put the airport into administration


before it was taken back under Peel’s ownership.


Peel has also explored many different potential aviation users at DSA, one of which is Hybrid


Air Vehicles (HAV). HAV could not previously be accommodated because of the passenger


aviation activities on site. However, the potential to attract leading-edge, future-tech


businesses to the site is considerable.


As such, you will appreciate that Peel has committed significant resources, both financial and


management, over a period approaching two decades, to making DSA an aviation success


but the market has not responded.


Since the Strategic Review announcement, Peel has been actively engaging weekly with local


and national political stakeholders. This has included private meetings, written


correspondence, and participation in working group meetings, primarily led by officers at


Doncaster Council, SYMCA and DfT. So far, there have been no tangible proposals regarding


the ownership of or financial support for the airport.


Should nothing arise from our discussions that guarantees a viable future for the airport, I can


assure you Peel has a long-term commitment to invest in the site. We will work collaboratively


with all public and private sector stakeholders to realise a new vision that will create more high


value jobs and opportunities for local stakeholders. Whilst not wanting to pre-empt the final


outcome of the review, I trust you will agree we need a forward-thinking approach from


Doncaster and the Mayor to help draw up vibrant, job-creating alternatives for this location to


ensure future growth and prosperity in South Yorkshire.


If you require any further information, my team, namely Robert Hough, Chairman of Peel


Airports, and Steven Underwood, Chief Executive of the Peel Group would welcome an


opportunity to discuss these matters with you.


Yours sincerely

https://committees.parliament.uk/publications/28739/documents/173149/default/

 

@pug Someone has pisted that Mike Kane has been sacked

 

Maybe just remind people of the below;

https://committees.parliament.uk/publications/28739/documents/173149/default/

It's probably the members of the SYMCA that need reminding of this.

 

It's probably the members of the SYMCA that need reminding of this.

Peel have told them, I guarantee you that. They’ve probably even given some idea of the commercial deals they had. It’s in Peels interests for the airport to work, but they’ll be keen on maximising the potential of the site be that aviation uses or otherwise. This is why they have stipulated a set of performance conditions in the lease.

 

. This is why they have stipulated a set of performance conditions in the lease.

Which Coppard is trying to alter because he knows they cannot be met?

 

Which Coppard is trying to alter because he knows they cannot be met?

Yes basically. Peel will probably agree to a reduction. If only SYMCA had shown this level of support it’s quite possible that the airport might have remained open, at least in some form!

Coppard is being inherently disingenuous in his public statements. His narrative downplays the risks considerably when compared to the papers that have been released. Amongst these critical risks are;

1. The threat of legal challenges, if there are any then it risks adding delays, increases in costs or even the derailment of the project.

2. The terms of the lease as discussed. Peel would be within their rights to trigger the break clause if performance targets are not met.

3. This is tied to 2 in a way but the documents state clearly that if the passenger numbers are at the lower end of the forecast numbers the airport wouldn’t be viable.

So basically they’re following the principle that the big greedy corporation (Peel) need to be reigned in. It’s what’s sold the entire project and it’s what’s got the public so riled up and supportive of reopening.

I maintain the public will be disappointed. People who claim it’s not about passengers are being disingenuous too. There’s no way the project would get as much support if it was just to support 2Excel and a little bit of freight.

 

Yes basically. Peel will probably agree to a reduction. If only SYMCA had shown this level of support it’s quite possible that the airport might have remained open, at least in some form!

Coppard is being inherently disingenuous in his public statements. His narrative downplays the risks considerably when compared to the papers that have been released. Amongst these critical risks are;

1. The threat of legal challenges, if there are any then it risks adding delays, increases in costs or even the derailment of the project.

2. The terms of the lease as discussed. Peel would be within their rights to trigger the break clause if performance targets are not met.

3. This is tied to 2 in a way but the documents state clearly that if the passenger numbers are at the lower end of the forecast numbers the airport wouldn’t be viable.

So basically they’re following the principle that the big greedy corporation (Peel) need to be reigned in. It’s what’s sold the entire project and it’s what’s got the public so riled up and supportive of reopening.

I maintain the public will be disappointed. People who claim it’s not about passengers are being disingenuous too. There’s no way the project would get as much support if it was just to support 2Excel and a little bit of freight.

I agree with your comments. Totally.

 

a quote form OC

That’s why I have consulted with experts, airlines and even those sceptical of reopening DSA. All to make sure this is the right deal for the future of South Yorkshire.

so some airlines must have said they intend to fly from DSA, or he would not have ok the project

It's possible he has intent/indication from someone or another but the traffic forecast for passengers in the documents for the meeting next week is just over 2m by 2051 which is poor and clearly insufficient to be profitable so clearly will have to rely on other substantial revenue streams. Yes - it is a forecast and the base might be understated as they are looking 25 years ahead but equally it might be overstated. In the short term there is an issue with the lease where the numbers required by Peel for 2031 will not be achieved (according to the experts) until 2036. Coppard is therefore trying to play down the importance of passenger traffic.
Having read through the papers it is clear to my mind that this is a 100% political decision as the tangible risks far outweigh the theoretic financial benefits - to the point where he will not make public the risk report - although we all know what they are. What developing this 'sustainable aviation hub' - which he hasn't really explained what it is - on Gateway East (which personally I might be in favour of it I knew 'who and what') has to do with the airport opening with the holiday traffic it is likely to attract has not been explained,
Thus I feel that all his rhetoric about putting the tax payer first has been totally swamped by political necessity.

 

It's possible he has intent/indication from someone or another but the traffic forecast for passengers in the documents for the meeting next week is just over 2m by 2051 which is poor and clearly insufficient to be profitable so clearly will have to rely on other substantial revenue streams. Yes - it is a forecast and the base might be understated as they are looking 25 years ahead but equally it might be overstated. In the short term there is an issue with the lease where the numbers required by Peel for 2031 will not be achieved (according to the experts) until 2036. Coppard is therefore trying to play down the importance of passenger traffic.
Having read through the papers it is clear to my mind that this is a 100% political decision as the tangible risks far outweigh the theoretic financial benefits - to the point where he will not make public the risk report - although we all know what they are. What developing this 'sustainable aviation hub' - which he hasn't really explained what it is - on Gateway East (which personally I might be in favour of it I knew 'who and what') has to do with the airport opening with the holiday traffic it is likely to attract has not been explained,
Thus I feel that all his rhetoric about putting the tax payer first has been totally swamped by political necessity.

It’s odd isn’t it, all this talk for weeks of how they’ve discovered ‘some things’ that make the project look too risky and therefore he ‘can’t say’ what the decision would be on the 9th. Yet when the papers are released (with significant restrictions) the risks are exactly the same as they were before.

It might be that a company has expressed interest and hence Coppard has been forced to change his tune to inject some confidence into the discussions, but let’s not kid ourselves that this happened throughout the airports existence. It’s one thing having interest and another entirely on actually securing the deal and even then as we saw in the past even with great intent profitability is all airlines can be interested in. Who knows at the moment but judging by the way this has been handled there seems to be a lot of confirmation bias and naivety surrounding it.

As for the ‘sustainable aviation hub’, well the cynic in me suggests it’s a hollow ploy to make good on the decisions of his predecessor. Seems that ship has sailed. So far only Holtec have expressed interest and they aren’t aviation, appears they only expressed an interest to secure a Government contract that ended up going to RR.

 

Just my take on the very sudden change by Coppard from being cautious for the go ahead to "I am now going to say yes" could be that if he knows LBA and possibly other airports are likely to launch a legal challenge which could hold up or even stop the project, he can say he did everything he could to get it re opened and the blame would go to LBA and others.

 

Just my take on the very sudden change by Coppard from being cautious for the go ahead to "I am now going to say yes" could be that if he knows LBA and possibly other airports are likely to launch a legal challenge which could hold up or even stop the project, he can say he did everything he could to get it re opened and the blame would go to LBA and others.

That thought had crossed my mind but I doubt it’s as clever as that. He wants an airport there because he thinks a city the size of Sheffield should have an airport, which I can sympathise with.

I think the sudden change in narrative is because he can’t talk down the proposal, he has to instil confidence in it and not undermine the proposal. He’s obviously received advice that it’s best to just push on, whether that’s sound legal advice or not I don’t know because we’re not allowed to see that bit of the plan. However the risk is there clear as day in the outline document that we are allowed to see.

The Green Book rules are changing to allow for long term investment programs that offer value over and above that which the project aims to achieve. They’re selling this on a wider economic regeneration footing and that’s why they thing they’ve got a solid case for reopening and defending their position should it be challenged legally. Not sure what the status is of the BRS v CWL case but that could set a precedent. It is possible that a legal challenge launched could halt proceedings whilst it works its way through, but they may still go ahead with reopening with that in the background. It could be a reckless move to do so however.

 

i dont think they will be to worried about a legal challenge.

The UK subsidy control regime enables UK public authorities, including devolved administrations and local authorities, to give subsidies that are tailored to their local needs, and that drive economic growth, while minimising distortion to UK competition and protecting our international obligations.

the locals need an airport (even though the people of west yorkshire would like to deny them one)

an airport will drive economic growth.

and as everyone one here says , no airlines is going switch to DSA from LBA.
so nothing to worry about.

 

i dont think they will be to worried about a legal challenge.

The UK subsidy control regime enables UK public authorities, including devolved administrations and local authorities, to give subsidies that are tailored to their local needs, and that drive economic growth, while minimising distortion to UK competition and protecting our international obligations.

the locals need an airport (even though the people of west yorkshire would like to deny them one)

an airport will drive economic growth.

and as everyone one here says , no airlines is going switch to DSA from LBA.
so nothing to worry about.

You’ve just copy pasted something from a Google search and embellished that with your own ramblings. So the key thing you’re skipped over is the bit where it says it ‘minimises distortion to U.K. competition’.

Ignoring the fact that failed airports have a negative effect on the economy, as outlined within the SYMCA document that is publicly available, the document also states as clear as day that the environmental impact will be mitigated by not generating extra traffic but dispersing it from other privately owned airports.

The locals don’t need an airport, but if be interested to know how you’re justifying that statement. The people of West Yorkshire aren’t trying to deny them anything, it’s the airlines that couldn’t make it work last time that are creating the local market.

It’s a flimsy basis for justifying the airports existence and I suspect it’ll be a line taken by any challenge.

 

You’ve just copy pasted something from a Google search and embellished that with your own ramblings. So the key thing you’re skipped over is the bit where it says it ‘minimises distortion to U.K. competition’.

Ignoring the fact that failed airports have a negative effect on the economy, as outlined within the SYMCA document that is publicly available, the document also states as clear as day that the environmental impact will be mitigated by not generating extra traffic but dispersing it from other privately owned airports.

The locals don’t need an airport, but if be interested to know how you’re justifying that statement. The people of West Yorkshire aren’t trying to deny them anything, it’s the airlines that couldn’t make it work last time that are creating the local market.

It’s a flimsy basis for justifying the airports existence and I suspect it’ll be a line taken by any challenge.

you need glasses pug,
2nd line, , while minimising distortion to UK competition
so i have not skipped it. and as i said nobody on here thinks any airline will leave|LBA for DSA
and it is not a google search , it from the governments website.
and any legal challenge will fail, just like your failed idea that |DSA was going open again

 

you need glasses pug,
2nd line, , while minimising distortion to UK competition
so i have not skipped it. and as i said nobody on here thinks any airline will leave|LBA for DSA
and it is not a google search , it from the governments website.
and any legal challenge will fail, just like your failed idea that |DSA was going open again

where to start.

Did you read my response? We have a local authority trying to reopen an airport that the commercial market determined there was no demand for. Therefore in order for there to be any possibility of attracting lasting and sustainable growth they must undercut the private sector competition to try to make it work. We know this happened previously under Peel and it failed, but what it did do is result in EMA and LBA having to reduce their aeronautical fees to remain competitive on cost to the airlines. This impacts revenue streams for private sector airports and therefore they will have a solid ground to argue that this is market distortion. They aren’t starting from scratch, there is 17 years of evidence to prove that there is no market failure here, but there is no market at all!

I’ve never said DSA wasn’t going to reopen, I have said that if it does there is a very high chance of it failing again. Someting that will also provide grounds for legal challenge.

Interested to know why you think a legal challenge would fail. So far there is no legal precedent, the BRS vs CWL is ongoing and it’s attracted the attention of various commercial law firms who are also watching with interest as to how it pans out. Judging by your inability to grasp basic principle is this then I think I know where to file your assertions that there is no case for SYMCA/CDC to answer to here

 

i dont think they will be to worried about a legal challenge.

The UK subsidy control regime enables UK public authorities, including devolved administrations and local authorities, to give subsidies that are tailored to their local needs, and that drive economic growth, while minimising distortion to UK competition and protecting our international obligations.

the locals need an airport (even though the people of west yorkshire would like to deny them one)

an airport will drive economic growth.

and as everyone one here says , no airlines is going switch to DSA from LBA.
so nothing to worry about.

I’d be incredibly worried about legal challenges and not just from nearby airports.

Tell us why you think DSA shouldn’t be worried about it? Because if you look up Bristol vs. Cardiff as @pug mentions, then legal action is already happening with other airports who are receiving tax payer money.

 

I’d be incredibly worried about legal challenges and not just from nearby airports.

Tell us why you think DSA shouldn’t be worried about it? Because if you look up Bristol vs. Cardiff as @pug mentions, then legal action is already happening with other airports who are receiving tax payer money.

Not only this, but there’s a reason SYMCA have flagged the possibility of legal challenge as a critical risk to the project.

Obviously they are going to argue the toss regarding the wider economic benefits to reopening the airport, this is in line with the Treasury Green Book. However there is clearly a push to disperse airlines from other airports as outlined with their environment impact assessment.

I asked rabbitfoot why the people of South Yorkshire need this airport. I’ve received no response to that question. I’d also like to know how it constitutes market failure? There is nothing a reopened DSA can do that other airports can’t, and that includes serving the population of South Yorkshire!

 

Not only this, but there’s a reason SYMCA have flagged the possibility of legal challenge as a critical risk to the project.

Obviously they are going to argue the toss regarding the wider economic benefits to reopening the airport, this is in line with the Treasury Green Book. However there is clearly a push to disperse airlines from other airports as outlined with their environment impact assessment.

I asked rabbitfoot why the people of South Yorkshire need this airport. I’ve received no response to that question. I’d also like to know how it constitutes market failure? There is nothing a reopened DSA can do that other airports can’t, and that includes serving the population of South Yorkshire!

I think the only reason the people of South Yorkshire can give is convenience. However convenience doesn’t give you a ready made market or an airline the ability to turn a decent yield. Especially in an area of the UK where disposable income is low, the propensity to travel is also low and there are three major airports bordering all areas of the region.

As you say, SYMCA have made it clear the business plan is to displace traffic and capacity from other airports. This doesn’t just mean LBA. All airports in the UK compete for the same limited capacity available from airlines. All will be watching this with interest.

I’m not sure what @rabbitfoot does for a living (although I have my suspicions ) but I’d suggest that he takes a little more note of what the likes of @pug and others say on here. There are many members on here who clearly not only have a long term interest and understanding of the industry, but also people who work within the industry.