Cardiff Airport - General Thread

[Jerry]

Coronavirus: Airport handlers at risk of collapse

Aviation services companies are calling on the government for urgent assistance due to the pandemic.

www.bbc.co.uk

It looks like the ability of CWL to operate at all in the immediate aftermath of all this is at risk.

They could take it all in house but there problem could be that all the handling equipment is most likely owned by Swissport so they'd have to purchase all that which wouldn't come cheap I'd have thought and they might struggle during big events as I think it was mentioned here that Swissport can bring in extra bodies from outside.

 

[mathers_wales_uk]

Problem you have at the moment is who can shout the loudest.

first it’s the airlines and now the handlers.

Handlers are the bottom of the pile and have been consolidating over the last decade to try and remain competitive.

MAS, Aviance, Reed Aviation, Servisair are one of the ones at the top of my head that have been merged into another company.

You got some staff doing highly responsible jobs, safety critical and not getting much than the living wage.

This has stemmed from the lo-cost airlines such as Ryanair & EasyJet where they go for price over anything else. They issue hefty fines for handling delays etc.

Even the legacy feeder airlines are at it now as they look to lower their fees to compete with the low cost carriers.

 

[Jerry]

There was a job posted in a Facebook group and I was genuinely surprised at how poor the pay was especially considering the job they do.

 

[Foxlimayankee]

This is another area where a shakeup will come. Some Airlines wont survive this and once demand recovers I can see seat prices increasing slightly.
Ground Handlers need to come together and look to charge Airlines slightly more to become more sustainable. Continually undercutting each other to win contracts puts companies like this at greater risk during tough times.
I'm not sure on WFS, but Swissport, Menzies and Dnata are all very big companies or have very big parent companies.
It would be a complicated process for Airports to take handling in house, however not unachievable given that very few Airports are actually operating passenger flights at the moment. Not so simple at larger Airports however.

 

[mathers_wales_uk]

Exeter Airport which is owned by the rugby group do their own handling.

Not only that they also have their own Executive Aviation facility under the XLR brand. One of their tenants are Capitol Air Ambulance and yes you guessed it also owned by Rigby Group.

Now Bournemouth is also part of the Rigby group and they have not extended the Signature Flight Support contract which has paved way to XLR Jet Centre. Now I don’t know who runs the cargo centre but I believe Swissport are present there.

Southend is Stobart Owned with executive handles by Stobart Jet Centre and All handling in-house.

Now Cardiff Airport has taking everything in house apart from Cargo, Executive Aviation and Passenger Handling. Now if something does happen to Swissport could Cardiff Airport take the jump to go self handling? Benefits of this is that handling prices could come down as they are not paying shareholders so could make Cardiff a more attractive option. Outlay however is quite substantial due to costs for equipment etc. They will also lose revenue from airside vehicle permits so have to balance it up.

Also benefit of having a handler is the airport can keep on threatening them to improve as underperforming, handling delays etc. If they take it in house they won’t have anyone to blame but themselves.

mind if they were ever going to go down that route then maybe it’s now more than ever.

 

[Foxlimayankee]

It's certainly something that could be achieved and could work out. However CWL is different to SEN and BOH due to the large scale events/Airlifts it handles, where Swissport can call upon additional staff and equipment from elsewhere.
Overheads of self handling might actually be higher as well, as Swissport can provide handling rates based on a national level rather than just a single Airport, where costs can be spread out, theres also various licences, IT facilities, training etc where costs would be spread out. A national contract with an Airline can work out cheaper than at just one Airport.
A based handler would also provide revenue for the Airport as well in many different forms, such as car parking, office rental, licence fees etc etc

 

[mathers_wales_uk]

It’s a hard one the balance out. Do you reduce handling rates and generate the income from parking / terminal by attracting footfall through the door.

Does Swissport provide a barrier to certain operators by not being competitive. If a carrier wants to come to Cardiff then there is no competition.

Swissport only have a handful of staff down for big events these days. Would it be possible to train back room staff to perform certain tasks like meet & greet or boarding for big events.

Of course you have higher insurance premiums etc and higher liability insurance too.

When your looking after almost every other aspect on the airfield bar handling it must be something they are toying with given the fact they have taken almost every other function in-house.

De-icing is one of those functions that can make operations profitable in winter months too. It does obviously increase overheads but re-jigging how the landing & handling fees are charged may work out well for them.

 

[Jerry]

With reference to big events. In general there is only 2 a year in February and March for the rugby so maybe it would be more about maintaining a higher staffing level for those months to cope with them on the specific weekends ie through overtime maybe. For other types of events like NATO or the Champions league etc there tends to be a few years beforehand to plan for them so temporary staff could be hired or a company contracted to assist during the event maybe.
With regards to the equipment some of it could be contracted to be made locally and that fact could be used as a bit of pr to show how the airport helps Welsh businesses.

 

[Jarvo]

I cant help but feel like the fallout of this is going to be the make or break of the airport. Just like the explosion of low cost airlines and online booking systems shaking up the industry in the early 00's, there's an enormous opportunity as well as danger for CWL. If the management can be forward thinking and come up with innovative solutions and forward thinking agreements, there are some real opportunities.

As mentioned above with bringing ground handling in house, that is definitely one route. The airport took fuel in house last year and basically wiped out the profit the private company was making while still keeping its own profit equal to the concessionary payments from the previous operator, lowering fuel costs for airlines. In events where extra ground handlers are needed, could the airpot not just subcontract the extra services needed to others?

 

[Jarvo]

The departure board is absolutely grim reading today... But also very good news for stopping the spread etc.

 

[Jerry]

cant help but feel like the fallout of this is going to be the make or break of the airport.

The challenge for the airport I think will be keeping Ryanair and TUI and keeping those 2 airlines roughly at their current level of departures because I think it's almost guaranteed that both airlines may well be tempted to make cuts at Cardiff in order to fill aircraft at Bristol and Birmingham with their no doubt being less demand about. And of course while trying to keep them gain back lost routes like Dublin. Definitely at least 5 challenging years ahead for the airport.

 

[TheLocalYokel]

I cant help but feel like the fallout of this is going to be the make or break of the airport. Just like the explosion of low cost airlines and online booking systems shaking up the industry in the early 00's, there's an enormous opportunity as well as danger for CWL.

Definitely at least 5 challenging years ahead for the airport.

The major recession of the 'noughties' had a serious impact on aviation with levels at many airports not back to their pre-recession situation until 4-5 years after the recession was reckoned to have ended, and some have even now not caught up. It's widely forecast that the Covid-19 effects will lead to a bigger world recession than that of a decade ago.

Jerry could well be right when he mentions five years, and not just for CWL but for the industry generally.

I think that Jarvo makes a telling point when he highlights the opportunities that are open to CWL, and indeed to other airports. I'm not saying everyone will begin the post-Covid-19 era with a clean slate but the aviation environment might look different, depending on the length and severity of Covid-19.

CWL is undoubtedly in a better position to ride the effects of the almost certain coming recession than it was the one in the 'noughties'. Its state ownership means that its owners are not necessarily looking to put the airport company into the black as quickly as possible in the same way as a private owner would. It's clear from comments made at recent WG committee meetings that the airport is not only seen as valuable to the Welsh economy but is also regarded as a status symbol for the country, therefore it isn't going to be allowed to die. Some UK airports might close as might some airlines; again it depends on the longevity and eventual seriousness of the pandemic and how the Westminster government reacts to bolster all sorts of industries, including aviation.

The previous paragraph has to be read with the knowledge that the WG will have calls to help the myriad sections of society for which it is responsible for funding once things begin to return to some sort of normality, so the airport will be one of many organisations that are likely to be looking for WG financial input.

 

[Jerry]

I've seen a post elsewhere saying that Cardiff is closed during the night now. The aerodrome is only open 7am to 7pm.

 

[Tinkerman]

I’m a believer that the world will be a different place post COVID-19, and that also means the Aviation Industry will. The longer this continues, the more of a “Hard Reset” it is for the whole industry. It’ll take time to recover, but could be to both the detriment or benefit to some airports !

Funny times these as many organisations around us and airlines alike, may not even be around in 3 months time that were such household names.

 

[aviatorconcorde]

I’m a believer that the world will be a different place post COVID-19, and that also means the Aviation Industry will. The longer this continues, the more of a “Hard Reset” it is for the whole industry. It’ll take time to recover, but could be to both the detriment or benefit to some airports !

Funny times these as many organisations around us and airlines alike, may not even be around in 3 months time that were such household names.

Yep. I think we could see Jet2, Virgin and even Easyjet go under. If the government steps in though, that obviously won’t be the case.

 

[Foxlimayankee]

Easyjet and Jet2 have been profitable for years and are in much better shape than most Airlines.

 

[Jerry]

Looking at airlines that operate from Cardiff.
TUI have recieved extra credit from the German state bank, KLM and Qatar Airways no doubt have the financial backing of their various governments and Vueling is part of IAG which is very cash rich. Ryanair is in general a cash rich organisation also. Loganair and Eastern Airways may well be more vunerable being smaller companies. Even if all the airlines survive the current crisis it'll have an impact on them probably for the next 5 years at least and effect where their businesses go from there and whether many of them in the future consider Cardiff airport in their plans.

 

[Jerry]

Cardiff Airport to receive Welsh Government aid during coronavirus pandemic
The Welsh Government will provide finance to support the reduced operations and to maintain solvency, half the staff at the airport will be put on furlough

Cardiff Airport to receive Welsh Government aid during coronavirus pandemic

The Welsh Government will provide finance to support the reduced operations and to maintain solvency, half the staff at the airport will be put on furlough

www.business-live.co.uk

 

[Foxlimayankee]

I guess the other half of staff are still working to keep the Airport operational?

Interesting to see the Airport/WG are topping up to 100% salary. At a time like this you would think people are generally spending less, no fuel/travel expenses to/from work and socialising. No additional spending on socialising, unnecessary shopping etc etc. You'd think 80% would for most people cover bills and living costs with some belt tightening.
In the grand scheme of thing, a 20% top up wouldn't amount to too much funding from the WG, however I do wonder if the Airport have given any deals to Airlines on rates, and if that deal has been extended to concessions and other companies at the Airport like SSP, Money exchange, car hire & Swissport. Those companies may not have the luxury of 100% wages and being low profit margin companies may have to lay off staff, especially temporary summer staff.

 

[Jerry]

nteresting to see the Airport/WG are topping up to 100% salary. At a time like this you would think people are generally spending less, no fuel/travel expenses to/from work and socialising. No additional spending on socialising, unnecessary shopping etc etc. You'd think 80% would for most people cover bills and living costs with some belt tightening.

Depends on what the basic salary is for the staff i suppose. Personally my basic salary isn't that great and i make up a good wage by whats considered 'overtime' it may be the same for many of the airport workers? I just think that by adding the extra 20% the airport is trying to show how much a responsible employer it is.

I guess the other half of staff are still working to keep the Airport operational?

I'd have it would be the airside staff that are still employed to keep it operational but even then they might be on limited hours.