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...?

 

'Never give up, never surrender'; Doncaster seeks support to reopen its airport: part two

centreforaviation.com

Some of this is behind a membership only barrier.

A bit of a problematic argument.

Firstly, they suggest that 20 years ago the airport would have been snapped up. That’s like saying 20 years ago people were buying Nokia 3310’s, times have changed. There aren’t the airlines around any more like there used to be so inevitably it’s heavily restricted growth prospects for the airport.

Secondly, and this ties into the first point, they are clear that Wizzair were wavering in their commitment. It’s clear that almost avenues were explored and Peel themselves stated that there are no realistic growth prospects. Given that cost of sales was increasing and revenue was way below that, the idea that they could somehow magic the large increase in revenue required to break even is laughable coming from an organisation that calls itself an independent aviation industry analysis organisation.

Amongst people they claim may be interested is the smaller U.K. operators and the Americans. I suppose if they are being offered free money to run it then of course they will be interested, but let’s not forget that the airport has been sold in the past and handed back as a basket case.

As you can imagine, the save DSA groups have gotten excited by this article. Oh dear.

 

There are suggestions being made on some social media groups that Peel dropped the ball with freight.

This is another myth, the statement they are using to back up such claims are actually supportive of what Peel said - large speculative financial investment was required to even get these operators to the table, and being so close to EMA who have the critical mass and therefore experience to accommodate the demand, it’s not a viable proposition for this to be replicated at DSA.

Another case of people reading what they want in statements and quoting statements out of context to lead to misrepresentation.

 

There are suggestions being made on some social media groups that Peel dropped the ball with freight.

This is another myth, the statement they are using to back up such claims are actually supportive of what Peel said - large speculative financial investment was required to even get these operators to the table, and being so close to EMA who have the critical mass and therefore experience to accommodate the demand, it’s not a viable proposition for this to be replicated at DSA.

Another case of people reading what they want in statements and quoting statements out of context to lead to misrepresentation.

Thanks for all your common sense posts Pug, both in here and on the dried fruit forum. It's good to see someone who actually lives in the real world and not some fantasy world where Doncaster and it's new city status has suddenly become the centre of the aviation world. Mores the pity that the local politicians aren't honest enough to accept reality and they're prepared to blow millions of the local funds chasing a dream based on a complete lack of understanding, all in the name of getting votes.

 

We needs Doncaster Council in Leeds. We may then have an airport that could almost rival MAN! @pug I totally agree with WH that your common sense posts are a breath of fresh air

 

Thanks for all your common sense posts Pug, both in here and on the dried fruit forum. It's good to see someone who actually lives in the real world and not some fantasy world where Doncaster and it's new city status has suddenly become the centre of the aviation world. Mores the pity that the local politicians aren't honest enough to accept reality and they're prepared to blow millions of the local funds chasing a dream based on a complete lack of understanding, all in the name of getting votes.

Thanks for the support and F66. I’m a bit torn on Doncaster Council, in some ways what they are doing is correct, they’re pushing for something they believe is of wider economic to Doncaster. The problem with it is that they appear to be attacking it from the same position as the people in the save groups, in that Peel they believe have wilfully (or by ineptitude) mismanaged the airport. It is this foregone conclusion that I take issue with.

The drip feeding of scant information is also unhelpful, the assumption that someone somewhere has more experience to lead the airport in spite of the overwhelming evidence that you can see if you just look a bit further than Doncaster and South Yorkshire.

I hate pointing out facts by calling them facts, as there is always some fluidity. However the facts in this case are thus;

Multiple airlines attempted new routes from DSA by way of basing aircraft or using outstationed aircraft. Only Wizzair and TUI lasted, and Wizzair U.K. was an abomination in terms of load factors on the few routes that did operate.

East Midlands is next door in aeronautical terms, it has purpose built freight integrator facilities to handle DHL and also UPS, Fedex, ASL and West Atlantic (previously Jet2) on the Royal Mail contract. They do handle some ad/hoc freight but it’s hardly the sort of thing you can generate enough revenue from. The lack of rail facility is a misnomer, the parcel freight business (which provides the revenue) is still largely road based distribution after arrival at the airport facility. Rail is used for bulk cargo which is not typically transported by air.

A lot is made of how Peel are a property developer, in the CAPA article they call them a property developer with a keenness for the smell of jet A1. This is misplaced, just look at the people in charge of the running of the airport company, people like Steve Gill, with many years experience of generating growth through a wide range of aviation revenue streams. He left DSA in 2018 to take up a position at BOH which is going from strength to strength. There were other highly experienced people in management positions at both DSA and MME. All left for pastures new well before the announcement of the strategic review.

The suppositions are what the revenue streams were, and the amount Peel were actually charging airlines to fly from there. It has been suggested that car parking went to a different Peel company. I believe this to be false as the revenue generated by DSAL just wouldn’t be generated by a pint and a paper, nor would the two or three companies with operational HQ on site contribute such a large amount. I expect about 40-50% of total revenue was car parking. As far as airline charges are concerned, Peel were known for undercutting on price to generate volume, they have proven record of entering agreements which include large subsidies. There is enough evidence to show that the high cost thing is a complete myth.

Still awaiting the release of the business plan. I expect things will be redacted in the name of commercial sensitivity, but if what has been posted elsewhere is genuine, it really doesn’t look good and I feel the Council might have to have that honest discussion before too long, we’ve been waiting long enough for it!

 

I just wish that the people of South Yorkshire would "rise up" and tell them to get on with generate jobs and not wasting money on an "ego trip"
My Dad always told me "It's easier to spend someone else's money than it is spending your own"
I think that this is a great example of that line of thinking.

 

Oliver Coppard;

‘Peel made a mess of Doncaster Airport, there is no reason why somebody else can’t make it work’. Also ‘Leeds Bradford and Manchester Airports are oversubscribed’.

Kind, kinder, Coppard: is Sheffield's Mr Nice Guy too sweet for politics?

We interviewed South Yorkshire's most powerful politician on transport, health and trying to stay human

www.sheffieldtribune.co.uk

More confirmation that the continued myths have contributed to the foregone conclusion.

 

Nobody wants to operate from DSA, proof is in the 17 year pudding. let it reopen.. it wont improve LBA or MAN's "oversubscribed status"... bore me later.

 

Even Links Air couldn't get things to work all those years ago and they only had 19 seats to fill. Probably says so much. Cash cow, dead duck, pudding and all other associated words are perfectly apt. And has been said, even if the vanity project were to succeed, it would not generate the prosperity turning the area over to industry will. There has to become a time, surely really soon, when reality must kick in for these councillors?

 

Nobody wants to operate from DSA, proof is in the 17 year pudding. let it reopen.. it wont improve LBA or MAN's "oversubscribed status"... bore me later.

Smaller core catchment area + larger direct competitors = lower bargaining power.

Lower bargaining power = less aviation revenue + less certainty in the market.

Basically, the airport operator of a less desirable airport has to offer financial subsidy to aim to attract business. When airline open new routes it is expensive and the more an airport has failed at generating passenger traffic the higher the risk becomes.

The reason DSA didn’t have highly experienced people driving the business in the end was because they all voted with their feet and left to places they saw as having more potential! They could see the ship was sinking years ago.

Peel didn’t make a mess of it, they just pulled the wool over the eyes of the people of Doncaster and its civic leaders when they bought the site to turn into an airport. It failed before the first bit of soil was broken.

 

It's rather worrying to see somone with the power of Oliver Coppard coming out with statements that Peel made a mess if it. I would love it if Peel would abandon this policy of silence and start hitting back at these politicians. They are just taking all the accusations in a sort of dignified silence and doing nothing to argue their case. I can't help wondering when or where they will end their silence and put the politicians back in their box. It surely has to happen.

 

It's rather worrying to see somone with the power of Oliver Coppard coming out with statements that Peel made a mess if it. I would love it if Peel would abandon this policy of silence and start hitting back at these idiotic politicians. They are just taking all the accusations in a sort of dignified silence and doing nothing to argue their case. I can't help wondering when or where they will end their silence and put the politicians back in their box. It surely has to happen.

I think their silence isn’t just to be dignified but also if/when a CPO is initiated they will have all the evidence to show why they found it to not be viable. They will be amenable to a lease agreement as the site would provide them with an income as I still don’t believe they have any solid plans for it yet, so perhaps they don’t want to put the council off if they can get some free rent!

 

I think their silence isn’t just to be dignified but also if/when a CPO is initiated they will have all the evidence to show why they found it to not be viable. They will be amenable to a lease agreement as the site would provide them with an income as I still don’t believe they have any solid plans for it yet, so perhaps they don’t want to put the council off if they can get some free rent!

I’ve seen on one of the Facebook groups that one of the regular posters who claims to have seen excerpts from a private sector report has posted some information relating to what Peel did to attract airlines. This includes waiver on passenger fees for airlines putting through volume, and ongoing marketing support. Nobody has commented. This same person has also posted information about an inter company loan (presumably to ensure the airport stays legal as a going concern), this has garnered all the comments.

Proof if any needed tear it’s convenient to ignore the fundamental points when you want to try and find a conspiracy in the accounts.

Judging by what this person had posted regarding the study, it’s not looking favourable at all!

 

Seen it posted elsewhere that when FlyBe based 2 x EJets at DSA it cost the airport operating company £1million per year. Suggestion that they were remiss for doing so. Nope, they wanted to grow passenger numbers. Do not assume that they had a long list of potential business lined up, cos they didn’t.

Sure I’ll get flamed for this, but it’s not my words. I knew they paid FlyBe to start up a base but I didn’t realise just how much it was.

We appear to have a viewer that is maybe not a member. I would encourage membership of this forum, we would welcome you with open arms as this thread needs some opposite opinions now.

 

LBA were all prepared for Flybe to base there, with aircraft stands even marked out. They were expecting an announcement to confirm it, and instead, Flybe announced DSA, coming as a total shock to LBA management. It was said at the time that DSA had subsidised Flybe hugely to go there instead of LBA,vso much so that they couldn't really afford not to take up the offer, but as we now know, they should have said no. It didn't end well.

 

Seen it posted elsewhere that when FlyBe based 2 x EJets at DSA it cost the airport operating company £1million per year. Suggestion that they were remiss for doing so. Nope, they wanted to grow passenger numbers. Do not assume that they had a long list of potential business lined up, cos they didn’t.

Sure I’ll get flamed for this, but it’s not my words. I knew they paid FlyBe to start up a base but I didn’t realise just how much it was.

We appear to have a viewer that is maybe not a member. I would encourage membership of this forum, we would welcome you with open arms as this thread needs some opposite opinions now.

A million isnt that much these days, especially spread over 12 months.

 

Nor was 1m any good to Flybe (twice) in the grand scheme of things so no a million isn't that much. What I will say though is how much more money could BE have made from LBA. Whilst I suspect a lot more it wouldn't have changed the eventual outcome

 

A million isnt that much these days, especially spread over 12 months.

Might not be much in the grand scheme of things (though pretty sure if someone gave me a million quid I’d quite happily be able to retire!) but it’s a lot of money when you’re trying to generate revenue through concessions and car parking.

Obviously with a deal such as that you need high load factors to provide the revenue required to make it pay. They didn’t get that. So ROI must be questioned.

 

Might not be much in the grand scheme of things (though pretty sure if someone gave me a million quid I’d quite happily be able to retire!) but it’s a lot of money when you’re trying to generate revenue through concessions and car parking.

Obviously with a deal such as that you need high load factors to provide the revenue required to make it pay. They didn’t get that. So ROI must be questioned.

For the sake of £1m I would have thought it would have been worth LBA's while to match it.

 

For the sake of £1m I would have thought it would have been worth LBA's while to match it.

They never had the opportunity. They understood they had a deal with Flybe for a 2 aircraft base and by the time they found out that wasn't happening, Flybe had already done a deal with DSA.

That said, certainly now, it's not LBA policy to subsidise airlines.