Fáilte Ireland boss urges airports to cut charges to boost tourism profits

Ireland will see a 6-7% rise in visitor numbers next year, but could enjoy greater returns from tourism with more competitive airport charges, said Fáilte Ireland chairman Michael Cawley.

Fáilte Ireland boss urges airports to cut charges to boost tourism profits

He said European air passenger numbers will grow from 750 million to 950 million in the coming years. Ireland will see inward tourism grow by 6-7% due to increased air access, he told a business breakfast in the Kingsley Hotel, Cork, hosted by chartered accountants Paul O’Donovan & Associates.

“There are 205,000 people working in tourism, a sector which is set to employ another 50,000 in the next five years,” said the former Ryanair deputy CEO. “Aviation will grow by 6-7%, and we know that because we know exactly who has bought new aircraft.

“Ryanair will own 40% of that growth in Europe. EasyJet will own 15-20%. Aer Lingus will remain at around 10 million passengers per annum, and some airlines like Air Italia may no longer exist in the form we know them.”

Mr Cawley said air travel is an industry in which supply creates demand, at least when it uses a flexible pricing model like that of Ryanair. However, he warns that Irish airport charges need to compete with other destinations or risk reducing its tourism dividend.

“Cork Airport charges €17 per passenger, and that makes it hopelessly uncompetitive,” he said. “Ryanair will make a profit of around €900m next year on 90 million passengers. That’s around €10 profit per passenger.

“The passengers belong to the airline, not to the airports. The airlines will seek to make money, whether that is in Bari or in Cork.

“Over the years, Michael O’Leary gave a lot of business to Ireland, business that could have been more profitable for him elsewhere. Ryanair can fly wherever they want to in the world, and it makes sense that they will fly wherever they can make the most money.

“The value of that Cork Airport’s €17 charge must be measured against the €450 each passenger will spend in Ireland. I don’t think that penny has dropped yet with Ireland’s policy-makers. I don’t know how they plan to boost tourism without working with the airlines because the tourists are not going to swim here.”

Mr Cawley said his comments were personal, rather than representative of the positions of either Fáilte Ireland or Ryanair.

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