Airport says it will underwrite new routes to "share" risk with airlines
Edinburgh Airport owner Global Infrastructure Partners (GIP) has launched a new £15 million fund to underwrite the expansion of new international routes.
The route development fund, which GIP says will be an “annual investment”, has been set up to “drive competition and bring new airlines and new routes to Edinburgh”.
Edinburgh Airport plans to underwrite new direct routes from the capital to take a share of the commercial risk along with the airlines.
Edinburgh Airport chief executive Gordon Dewar said the move was part of a wider plan to bring Edinburgh’s public and private sector together to promote the capital and the airport around the world.
Passenger figures released earlier in the month for Scottish airports revealed a drop of 190,000 travelling through Edinburgh last year compared with 2011 figures while Glasgow and Aberdeen – both still under BAA ownership – recorded growth of 4.2 per cent and eight per cent last year.
GIP, which acquired Edinburgh Airport from BAA in April of last year in an £807 million deal, said the airport has “lost some momentum” in 2012 as a result of a “challenging” 12 months.
German airline Lufthansa announced in April it was switching its Düsseldorf service from Edinburgh to Glasgow Airport.
However, Dewar said new flights announced in the past year from Edinburgh by easyJet, Ryanair, Turkish Airlines, Air Canada and Virgin Atlantic “will offer Scottish passengers choice from an unprecedented 130 routes this summer”.
Announcing the new £15 million development fund, Dewar described it as "simply putting our money where our mouth is".
He said "The deals with easyJet and Ryanair alone will see almost 16 million passengers pass through Edinburgh Airport over the next five years.
"But we are hungry for more success, and will work hard to take business from other Scottish airports and from our European competitors.
“To fuel that competitive effort, we will invest £15 million a year underwriting new direct routes for Edinburgh, sharing the commercial risk with airlines; it is simply putting our money where our mouth is.
“We believe that in doing so we send a powerful message to international airlines - we're going to be the place where Scotland meets the world so come here and we will work harder than anybody else to deliver you long-term success.”
The airport will also work with the council and businesses in the city in order to target specific markets for new routes.
Dewar added: “We can’t do this alone but be in no doubt, we will lead on the commercial deal, but any business with a significant stake in a new route should be thinking: how can I potentially make a difference?
“In the coming weeks and months, we will approach city businesses to listen. We want to know which markets are important and what the value might be to Edinburgh, and those individual businesses, or new routes into Europe, the Middle East or North America.
“I am confident that Edinburgh Airport will grow and our route network will soon be the envy of many European airports.”
David Birrell, chief executive of Edinburgh Chamber of Commerce, said: “Edinburgh is a world class city culturally and economically.
“Investing in and enhancing our transport links is an essential element in ensuring we retain that profile and enhance it further.
“It is therefore fantastic news that Edinburgh Airport’s new owners are making good on their promise and actively seeking to attract new visitors to the capital through this initiative.”
Edinburgh Airport is the busiest in Scotland – it carried 9.2 million passengers last year and services routes for around 40 airlines.