Warning of more pain for Shannon Airport

THE chairman of the Dublin Airport Authority (DAA), David Dilger, has warned of further pain ahead for Shannon airport, stating that its cost base is too high and its revenues too low.

Addressing a Shannon Chamber of Commerce lunch, Mr Dilger said: “My own view is that maybe it would have been better (for the DAA) to call a day on this (Shannon airport) five, six or seven years ago.

“But we haven’t done that and we are not going to do that and we will give the team there every single opportunity to build a sustainable business,” he added.

Mr Dilger said that the DAA “has subsidised, over a good few years, very significant losses at Shannon”.

He went on to say that the authority has invested €90 million in capital in Shannon in the last three years and €160m over the past 10 years.

“I have never seen that kind of long-term commitment to very, very low-return assets. That is what we are talking about here in the long-term, like it or not — very, very low-return assets,” he continued.

“Almost every company I have worked for would have cut off that valve by now, but the DAA hasn’t. Because why? Incredibly to me, it has a really optimistic belief in the future of this airport at the heart of this region,” Mr Dilger said.

Last year, passenger numbers dropped by one million at Shannon, as Ryanair ended its five-year deal.

According to Mr Dilger, Shannon Airport’s future is as a “smaller, tighter, leaner, meaner, more efficient airport” and he warned there will be “some pain involved” in getting there.

The target for Shannon, he said, “is to earn a very small, but sustainable level of profit to enable us to continue to develop the airport.

“That’s the future of Shannon. I wish it was much more grand, but Shannon isn’t in need of a grand plan. There have been a million grand plans that have failed to deliver what Shannon needs and some quite significant and unnecessary investment came about as a result of the need to deliver on the grand plan.”

He added that Shannon’s greatest need is not more investment, but a dedicated management team that can create a cost base in line with demand.

“That is what is required and that is all that is required,” he said.