In 2012, the Dublin Airport Authority signed a heads of agreement with international group Lynx to establish the hub at Shannon.
This followed the two sides entering a memorandum of understanding in 2009 to explore jointly the feasibility of developing the cargo hub.
Lynx put an initial proposal that the DAA fund the project for €7m.
The Department of Transport had received a business case from the DAA concerning the plan. Since then, Shannon has secured its independence from the DAA.
Now, in a letter to Clare County Council, company secretary at Shannon Mary Considine has confirmed the project is not to go ahead.
Ms Considine said the plan had been hatched in better economic times.
“The Lynx project was conceived prior to the economic downturn and the business plan was materially affected by the subsequent downturn in economic activity,” she said.
The airport had examined variations of the proposal with Lynx to try to identify a way forward that made business sense for both sides.
“While the cargo facilities would certainly benefit from improvement, we also recognised that before engaging in significant capital expenditure, we needed first to identify the potential demand and convince airlines that Shannon represented an attractive market opportunity,” said Ms Considine.
“Ultimately, it was not possible to identify a path forward with Lynx which satisfied both parties’ commercial requirements and the parties disengaged amicably.
“However, Shannon Group has continued to actively pursue opportunities to develop its freight business, working with key local stakeholders to identify key air cargo exports which could be attractive to airlines and engaging with airlines to present the market opportunity to them.”
Ms Considine said this has resulted in Turkish Airlines Cargo operating ad hoc freighter services through Shannon since the spring.
Fianna Fáil TD Timmy Dooley said: “I am not at all surprised that the Lynx proposal will not be proceeding, and am only surprised that it took the Shannon Group so long to confirm that there is no potential business.”
He said that, since 2008 and 2009, the project was being touted “as the saving grace of Shannon”.
”There was a massive amount of hype generated by the then opposition who clearly hadn’t done their research.
"Hopefully, lessons have been learned from that kind of politicking,” he said, adding that, as far back as 2009, he had concluded “there was absolutely no live project in Lynx”.
Fine Gael TD Joe Carey said “a range of opportunities for business growth are being pursued by the Shannon Group including enhancing cargo facilities… It’s high time that everyone across all political parties and none would get behind the Shannon Group.”