Action urged on air traffic

ACTION is needed to kick-start air passenger traffic to and from the “beleaguered” Irish economy.

This is according to Bloxham stockbrokers which was reacting to the latest figures from the Irish Aviation Authority (IAA) which showed flight activity at the three main airports grew just 1% in May after adjusting for ash-related problems in May 2010.

Transatlantic flight activity between Europe and north America which crosses Irish airspace was up 5% on an adjusted basis.

The unadjusted figures show that in May commercial traffic at Dublin airport was up 7.5% and up 27.8% at Shannon.

It was down 3.6% in Cork.

According to air traffic organisation Eurocontrol, 2011 is expected to see 3.2% growth in flights across Europe, a downwards revision on its previous estimate.

This traffic forecast indicates the fairly certain bounce-back from the ash-cloud disruptions which will add 1% to total growth in 2011. Also it will be helped, according to the IAA by the “much less certain” traffic recovery hinted at by the continuing high load factors, as air carriers continue to search for the right level of capacity and to make other structural changes to their offers.

Separately, results from IATA’s Airline Financial Monitor, point to a significant deterioration in sentiment on the outlook for industry profitability in 2011.

IATA have substantially reduced their forecast for airline industry net post-tax profits in 2011 to $4bn (€2.8bn), less than half the $8.6bn forecast in March 2011, which is largely due to the demand shocks from Japan and a further $20 per barrel rise in oil prices.

Meanwhile, in Ireland there are moves to cut airport terminal charges by up to 40% while discussions are also taking place on abolishing the travel tax in return for airlines increasing passenger numbers.

As part of the changes, the €202 terminal charge levied on each flight by the IAA will be cut, starting with a 28% reduction in 2012, and followed by further annual reductions of about 5% to the end of 2015.