Wednesday 17 January 2018

Cork goes pop as airlines struggle to make their old Tiger routes pay

Ryanair's closure of the Cork-Dublin link has been blamed on what would have been unthinkable 10 years ago -- a decent road

Thomas Molloy and John Mulligan

Aer Lingus gave it up years ago, and now Ryanair has come to the conclusion that the Dublin-Cork route just can't pay its way.

This week, Ryanair blamed its decision to axe the service on something that less than a decade ago would have been unthinkable -- a decent road linking the capital to the country's second biggest city.

Ryanair said that its passenger traffic on the route declined from 340,000 in 2007 to 150,000 last year.

The termination of the service marks the continuing decline of domestic routes, but is also just another chapter in Ireland's slowly dwindling direct air connectivity.

Bling dalliance

Former Aer Lingus chief executive Dermot Mannion dallied with the Celtic Tiger's love of bling, when he launched a service between Dublin and Dubai in 2006.

It came in what would effectively be the death throes of Ireland's then decade-long economic expansion. The service ceased in March 2008, just months before the global meltdown but at a time when it was already apparent that the domestic economy was getting into trouble.

Later that year, the direct service to Los Angeles got the chop, while Aer Lingus services to Washington DC and San Francisco were euthanised in late 2009.

There's little prospect at the moment of the carrier expanding its current portfolio of US routes beyond New York, Boston, Chicago and Orlando, leaving business people being forced to use connecting services to reach American west-coast destinations from Ireland and vice versa.

The US east coast remains well served by airlines including Delta, United-Continental and US Airways.

"Changing planes in Chicago, New York or Heathrow adds a vast amount of unpredictability to a trip," says Fergus Sullivan, the 42-year-old director of a Silicon Valley internet company who often returns home to Dublin for work and pleasure.

He adds that delays due to weather, lost bags and missed connections aren't just "theoretical risks", but that disruptions seems to happen regularly.

"A non-stop from California to Dublin would make doing business in Ireland vastly simpler," he thinks. "I'd rather spend 10 hours getting to Ireland than 16. I want to get on a plane, work a little, read a little, watch a movie and nap.


"I don't want to hare from terminal to terminal working out whether snow, thunderstorms, long immigration queues or lost bags are going to turn a four-day trip into a train wreck."

Aer Lingus said last week that despite having had talks with airports on the US west coast, it wouldn't be recommencing any services in the near future as they're likely to be loss-making.

The Dublin Chamber of Commerce claimed the lack of a direct service from Dublin to San Francisco or Los Angeles was a "major obstacle" to Irish companies seeking venture capital.

But it's hardly a surprise that many routes dried up as the Irish economy withered. Lufthansa-owned BMI -- long a stalwart on the Dublin-Heathrow route -- stopped basing an aircraft in Dublin in 2010, resulting in the loss of 33 jobs, although it continued to operate the service. It said the move was to do with the more efficient deployment of aircraft.

The Dublin Airport Authority's annual reports reveal just how services at the capital's airport have been affected in the past few years. In 2007 there were 89 airlines servicing 200 destinations. Last year there were 63 serving 177 -- still more than there was in 2006, however.

Yet even as some routes have been canned, others have prospered, such as Abu Dhabi-based Etihad's service between Dublin and the Gulf emirate.

It has proved a popular choice for Irish travellers making their way to Australia -- many of them emigrating to find work. The Dublin-Abu Dhabi route is profitable for the airline.

Other carriers that relied on a vibrant transfer of labour between eastern Europe and Ireland during the boom years quickly found that demand was stunted as the global economic downturn took hold.

The local impact of route closures can be significant. When Ryanair decided to cease operating a base at Marseille earlier this year following a row with French authorities over labour laws, the reaction of the local chamber of commerce -- which controls the city's airport -- was one of consternation.

Its president, Jacques Pfister, said that Ryanair had brought hundreds of millions of euro into the local economy in the previous four years.

"Ryanair, thanks to its planes based on our territory, has enabled the creation of 1,000 jobs directly or indirectly and brought into the local economy over €550m," he said.

He added that a court ruling which said that Ryanair employees based in France should be subject to French rather than Irish employee and tax laws, was akin to "putting the brakes on development".

When Ryanair sabre-rattled the previous year that it was considering leaving Marseille, Mr Pfister described it as an "alarming threat to the future" and even went as far as to suggest the "whole country" could be destabilised.

But Ryanair is nothing if not fickle. As long as the economics make sense, it will jump right back in to airports it has previously abandoned.

Even while Marseille suffered from 13 routes being cut by Ryanair, the airline subsequently added 11 for the current summer season and even has two aircraft based there again up until early next month.

Nine of the summer routes were routes it had previously culled.

Ryanair has also slashed links between Ireland and Germany in recent years, axing popular routes linking Dublin and Hamburg and reducing routes between the capital and Berlin.

Despite this, German-Irish Chamber of Commerce chief executive Ralf Lissek believes the moves have had very little effect on business. He notes instead that Aer Lingus has opened a new route to Stuttgart which is the capital of Baden Wurttemberg -- Germany's economic powerhouse.


Ryanair's closure of routes to Germany from places such as Shannon has hit individual companies but "the roads to Dublin are so good nowadays that it is not really an issue," he adds.

Sources in the airline industry suggest that a new route between Dublin and Leipzig in eastern Germany is also likely to open soon, further enhancing the links between Ireland and our third-largest trading partner.

As Ireland slowly claws its way out of the economic mire it finds itself in, new routes and additional services will probably become more attractive to airline operators.

But those services are also certain to remain dominated by just two carriers -- Ryanair and Aer Lingus, with Ireland's relatively small population and peripheral location continuing to make it a largely unappealing prospect for many potential competitors.

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