May 13, 2003 at 7:42 pm
Flybe in crisis talks with States
Flybe is concerned any takeover will seriously affect business
Flybe is holding crisis talks with Guernsey politicians after the airline revealed its service to the island is at risk.
It follows a proposed takeover of Channel Islands’ airline Aurigny by Guernsey’s States after British Airways’ decision to stop flying the Guernsey to Gatwick route from 16 June.
Flybe has said it is worried any takeover will seriously affect its business.
Meanwhile, Guernsey should try and acquire the landing slots at Gatwick airport and licence them to an independent airline, according to a local aviation expert.
States-subsidised
The managing director of Flybe, Jim French, said that his company does not want to operate on a route against States-owned opposition.
He said flying in competition with a States-subsidised airline would not be a level playing field and the company would be fighting an unfair battle.
He is urging States members to look at all the available options before pressing ahead with the purchase of Aurigny.
The States is deciding on whether it should buy Aurigny at a cost of about £5m.
BA’s decision to withdraw from Guernsey has been made because the 66-seater ATR 72 aircraft which operate the route will be retired and returned to their leasing company this summer.
Slot licences
The airline claims putting a larger aircraft type on the route would only incur unsustainable losses.
However, Guernsey should try and acquire the landing slots at Gatwick airport and licence them to an independent airline, according to the chairman of the Guernsey Chamber of Commerce’s transport sub-committee.
Roger Dadd says States members should be considering all the options ahead of the purchase debate and that a licence system works well for island ferry services and could also be used for Guernsey’s air links.
Flybe’s Jim French said his company was ready to provide that service without the government entering into the airline business.
By: wysiwyg - 22nd May 2003 at 21:19
Exactly. The only turbine that seems to endure the number of cycles are the various forms of PT6 (as in the shed, twotter, etc.).
By: Saab 2000 - 22nd May 2003 at 20:53
That is where the shed, dear I say it, has done us proud, wysiwyg! Just imagine the Saab on inter island cost wise 😮
By: wysiwyg - 22nd May 2003 at 20:46
Modern turboprops would not be viable for such short sectors with so many start cycles.
By: Saab 2000 - 21st May 2003 at 19:22
A dash 8 or ATR 42 would be too big and uneconomical for inter island though I would like them to acquire a similar type of aircraft in the future 🙂 Maybe base it at Jersey as a home airline because the aircraft cannot get into Alderney and by hell they wouldn’t consider Guernsey, and then operate destinations in France or the UK.
By: EGNM - 20th May 2003 at 22:20
keep us informed SAAB – wud be nice to see tghem aquire a Dash 8 or even a ATR-42 for the run to try and compete against the monopoly
By: Saab 2000 - 20th May 2003 at 18:38
Depends if they get the route. It is tryiny to test whether the States will protect their airline and keep the monopoly or allow Le Cocq’s on. Suppose it would be operated with an Islander or Trislander. To be honest I don’t know what aircraft they have nowadays, Noel Hayes seems to be leasing so many different aircraft at the momemt.
By: EGNM - 19th May 2003 at 21:27
should be interesting -is that with the Trislander still?
By: Saab 2000 - 19th May 2003 at 20:11
Sorry to continue on this subject but the air wars continue.
Today Le Cocq’s filed an application to fly JER-GCI on inter island- the big Aurigny monopoly. They say there is room considering the Aurigny cutbacks.
By: Saab 2000 - 18th May 2003 at 20:02
Just recieved a copy of Friday’s Jersey Evening Post. Actually quite good to see the other perspective on the matter. Comparison between the Guernsey Press and Star’s and The JEP’s perspectives:
Guernsey;
Locally-based aviation expert and journalist Geoff Jones described it as deplorable.
He said it was the latest in a string of sad and very expensive decisions made by the States.
‘I’m amazed at the 38-to-2 vote in favour,’ he said.
Deregulation of civil aviation started in the United States in 1978 and about five years ago in Europe.
‘There are very few parts of the world these days where it is regulated – in other words, where the state owns the airline,’ he said.
Olympic Airlines in Greece is state-owned, he said, but the Greek government was trying desperately to get rid of it due to the financial burden.
‘Whether it’s for securing slots or whatever it is, I think it’s a terribly retrograde step, particularly in today’s air transport industry.’
People were told that Guernsey would lose the Gatwick slots, but Flybe already had slots.
‘I believe there are only four, or perhaps five, slots that we have secured. Flybe has far more slots than that and they are still available.’
EasyJet had expanded its Gatwick operation phenomenally over the last two years by acquiring its own slots.
‘We should have been allowed to operate in a free-market economy and, if we lost the slots by losing British Airways, so be it. But I don’t think we’re being told the truth. If we were to operate in a free-market economy and an airline wanted to operate into Gatwick again in the future, then I think we could get the slots back.’
He said that airlines that were not run by the States were now in a difficult and embarrassing situation.
It was a myth to think that the States would not interfere with the company. There had to be interference as the States was now the majority shareholder.
‘The sooner the States divest themselves of a majority shareholding in Aurigny, the better. But whether they can do that remains to be seen.’
He said the money should have been spent on subsidising the island’s air services.
Jersey;
The States of Guernsey are to be congradulated on takingg decisive action to protect their lifeline slots at Gatwick through the purchase of Aurigny, the beneficiary of British Airways’ sudden withdrawal from services to their island.
Much criticism has been levelled at Guernsey politicians for ‘putting the clock back’ on government ownership of airlines. Yet the United States at this very moment arrangements are being made to bail out major national carriers to protect them from collapse in an exercise which more or less amounts to nationalisation.
We have to face the fact that the aviation industry is endemically highly volatile. Having an island economy heavily dependent on such an unstable transport medium, as Guernsey and Jersey are, both as finance centres and tourism destinations, is bound to produce major tensions. All this compounded when the UK is facing a capacity crisis, particularly at London airports.
There is much to talk of protecting slots for the Channel Islands’ air services, but little evidence of real political progress. In these circumstances, the members of the States of Guernsey have acted in a way that surely deserves admiration. It may entail risk, but probably much less risk than inaction.
If only British Airways had offered Aurigny our Heathrow slots.
******
Two different opinions there.
Generally the people of Guernsey have taken it as a bad idea. They are worried about a monopoly and high prices. Their sympathies lie with Le Cocq’s and Flybe.
By: EGNM - 18th May 2003 at 16:47
well if the airline is government owned, along with the license issuing authorities i don’t think that anything would be revealed to the public until everything was internally clarified as it be?
By: Saab 2000 - 16th May 2003 at 18:03
No because then you take the 1 hour ferry between Guernsey and Jersey with cheap fares and duty free 😀 That is Aurigny’s main competitor. Aurigny may have a monopoly in the air but it is far from the number one option for inter island travel.
Also, another thing I am currently wondering is whether or not Aurigny will have to apply for the licensce like everybody else?
By: EGNM - 15th May 2003 at 23:21
i suppose with the route monopoly the public will have a grin and bear it regime
By: Saab 2000 - 15th May 2003 at 20:21
You can also add the BAe 146 for the summer weekends. The Shorts could not be replaced (they are actually getting another one, rumour has it from Loganair) as the inter island route which is now really going to be a total Shorts operation from GCI-JER, could only really be served by that aircraft as the saab and ATR probably would not be as gooder operating costs.
By: EGNM - 15th May 2003 at 18:14
yea – seems unusual to have the Shorts 360, SAAB 340 and ATR-72 – Expect that the Shorts will be replaced by an ATR freighter when the leases end then?
By: Saab 2000 - 15th May 2003 at 14:06
I am not sure how long the leases on the aircraft exist, think it is only a couple of months. Aurigny will have quite a diverse fleet now from its humble beginnings with the Trislander.
By: skycruiser - 15th May 2003 at 03:27
Thanks for the info SAAB.
By: Saab 2000 - 14th May 2003 at 21:20
Mongu,
Essentially this is what the States of Guernsey have done. When the opportunity of being able to own an airline that had managed to acquire the use of much sought after take-off and landing slots at Gatwick, the natural temptation is inevitable and cannot be resisted. I generally agree that those slots should be protected by an airline or government to guarantee vital airlinks to mainland airports.
What I am against is how the States have jumped in and not considered any limitations nor long term strategy. What is to say that another £2 million will not be needed? They should of not got involved in the running and owning of an airline, simple as that.
I have no real reservations about Aurigny taking on the Gatwick route, it is excellent to see, after the BA pullout, an airline that is orientated at the island market taking over the route. However, I still think Flybe. would have probably been better on receiving those slots. For them it would be the expansion of an already very popular service. Anyhow, what strikes me as strange is that Flybe. had no consultation that the slots were up for sale, it was a case of BA just prepared to let them go (strike you as being a little odd with BA?) and selling them to Aurigny. I suspect that maybe they wanted to ensure Flybe. had a continual competitor on the route.
With the subject of the Isle Of Man, Channel Islands and the Highlands governments’ attempts to secure slots, I am in full support. They are vital, especially London, to the economy, tourism industry and general well being of islanders. As we are not part of Europe (bar the later islands) we need to seek, through the UK government, help to persuade the EU to secure a number of slots at major airports for the regions. It may take some time to be implemented but it is needed. Just for example, if I take Guernsey’s Gatwick figures for last year, 300,000 passengers, we cannot underestimate these. What would be the effects if flights were lost?
By: Saab 2000 - 14th May 2003 at 18:37
skycruiser, they will be BA crews.
The News from today.
The news came in about an hour ago; the States of Guernsey will buy Aurigny. 38 to 2 voted to buy the airline today after shareholders rejected offers to finance the Gatwick slots. Therefore a deal was passed today that would see Aurigny being bought by the States for £5 million with an extra £2 million for fees and operational costs. This will be the first airline ever to be nationalised.
http://news.bbc.co.uk/1/hi/world/europe/3025669.stm
Consequences:
The consequences of this are very concerning and no doubt history will judge their wisdom. The buyout will seriously effect Flybe’s business over here because it is unfair competition, they are threatening to pull services. Le Cocq’s are threatening to pull out as well and will now not expand from Guernsey to new destinations in France. Le Cocq’s will also now consider whether or not to compete with Aurigny on the JER-ACI route.
My opinion:
Absolutely saddened at the decision. Why should we be forced to pay for an airline when Flybe. could of taken those slots? Why they were never informed or given a chance to gain the slots is another question that comes to mind? This is very unfair to have this sort of States-subsidised monopoly. Moreover, there will be problems in fairness when it comes to route licensing, how the hell can the States remain impartial if it was both licensor and owner of an airline? I would also like to know why as a Guernsey resident what justifies the £5 million purchase? They have broken even sure but that is not the gain of return that a venture capitalist would like to see.
So here we go, look at Aeroflot in the last few decades and see an image of The Channel Islands future aviation industry.
By: skycruiser - 14th May 2003 at 12:30
Your right WYS! Not a chance.
Are Aurigny getting an ATR, if so are they wet leasing or training there own crews up?
By: wysiwyg - 14th May 2003 at 09:15
SC – It’s being done with an ATR72. Would you leave HK for an ATR command? I didn’t think so! 🙂