APPENDIX 11
Memorandum submitted by easyJet
INTRODUCTION
easyJet warmly welcomes the invitation to contribute
to the Committee's Inquiry into Northern Ireland Air Services.
We believe that such an Inquiry is timely and strategically important
in evaluating the views set forward in the Government's Aviation
White Paper ("The Future of Air Transport"), published
in December 2003 and in providing an up-to-date, extensive assessment
of the aviation industry in Northern Ireland and recommendations
for its future development.
In our opinion, a strategic view of air service
development from Northern Ireland is critical in terms of the
essential nature of air access from the Province. However it is
also highly pertinent to carry out this Inquiry in light of the
unique nature of two airports serving a city the size of Belfast
and in respect of the unique location of Northern Ireland within
the UK and the associated implications of different regulations
being applied towards what is essentially the same general air
market within the Republic of Ireland.
BACKGROUND ON
EASYJET
easyJet commenced air services within the UK
in November 1995 with a business plan largely replicating that
of Southwest Airlines, the highly successful pioneer of low cost
travel in the United States. Having undertaken a stock exchange
listing in November 2000 and the subsequent acquisition of Go
in August 2002 to become the principal operator of low cost air
services throughout Europe, easyJet are currently the fourth largest
airline in Europe in overall terms, operating 700 flights per
day and facilitating affordable air travel for 26 million passengers
per annum.
Our mission is:
To provide our customers with safe, good value,
point-to-point air services. To effect and to offer a consistent
and reliable product and fares appealing to leisure and business
markets on a range of European routes. To achieve this we will
develop our people and establish lasting relationships with our
suppliers.
THE DEVELOPMENT
OF CAPACITY
AT EXISTING
AIRPORTS
easyJet commenced operations from Belfast International
Airport ("BIA") in September 1998, initially offering
two daily return services to London Luton. Having recently announced
the introduction of new routes from Belfast to Rome and Berlin,
completing the flying programme for a fifth based aircraft to
operate from Belfast with effect from July 2005, easyJet will
be operating up to 84 flights per day through Belfast on 18 different
routes, nine of which are domestic and nine international. In
conjunction with other aircraft operating from UK bases easyJet
have nine aircraft operating through Belfast accounting in traffic
terms for over 12% of our network.
Over the past six years easyJet have carried
over 11 million passengers on the Belfast route network, with
over 3 million alone in the last 12 months. This accounts for
over 50% of Northern Ireland's annual scheduled air traffic and
our research indicates that 73% of our passengers are repeat users,
with a broad base of support right across Northern Ireland and
beyond into the border counties of the Republic of Ireland.
INTRODUCTION OF
NORTHERN IRELAND
SERVICES
Following our initial evaluation of the Northern
Ireland market we chose to launch flights from BIA for a variety
of reasons. The easyJet model is based upon a number of key principals
encompassing the removal of unnecessary costs, maximum utilisation
of aircraft and efficient use of airports. BIA provided us with
an operationally sound airport with flexible facilities and growth
potential, no constraints to flying hours and utilisation and
central access to the entire passenger base within the region.
We have developed a strong base of both business and leisure support
and since our initial launch in Northern Ireland we have consistently
added routes and aircraft, developing the scale of our own operation,
providing direct and indirect employment and delivering wealth
and economic opportunity to Northern Ireland. We see Belfast as
a vibrant and highly attractive market and as we add new airbus
aircraft to our fleet and increase destinations served throughout
Europe there is potential to link Belfast with a broad range of
other points.
Belfast has been a particularly important element
of our network development in that it provides for high aircraft
utilisation through the option to mix short and mid-range domestic
sectors with longer international sectors.
DEVELOPING CAPACITY
As previously stated we see potential to develop
trafflic flows through Belfast. easyJet seeks to provide an attractive
network, low fares and a reliable service that consumers vlaue.
The prospective challenges we foresee for Northern
Ireland include to ability to compete effectively with Dublin
and Shannon for visitors to the Island and to develop a coherent
strategy, which will encourage development of sufficient infrastructure
and a level of inward investment in order to maintain sustainable
growth on both domestic and European routes.
SPECIFIC CHALLENGES
FACING NORTHERN
IRELAND AS
PERIPHERAL REGION
OF THE
UK
As is the case with all other peripheral points
in the UK there is an essential requirement to be efficiently
connected to London and other key UK commercial centres. The onus
placed on air services linking Northern Ireland to these points
is even greater given the separation from the mainland and the
ongoing competition with the Republic of Ireland for economic
growth opportunities. We recognise that Northern Ireland still
has a significant challenge in developing strong inbound traffic
flows due to the hangover of its recent history. However, we have
uncovered many positive aspects throughout our own development
in the region, not least the high propensity of the home market
to travel which has helped us to deliver a strong platform of
service to three London airports and a high level of frequency
to some other major UK business destinations.
THE EFFECTIVENESS
OF THE
ROUTE DEVELOPMENT
FUND
In our opinion the Northern Ireland Air Route
Development Fund has been a positive initiative. easyJet has now
successfully applied for support on five new European routes to
Paris, Nice, Geneva, Rome and Berlin. The provision of support
funding assists significantly in the early stages of new market
development, providing comfort in the initial route proving period
and confidence to enter uncharted territory in the first instance.
The fund has helped to greatly improve Northern Ireland's reach
into European markets and we believe that the continued provision
of such support is vital for any new routes, which may come online
in future.
THE POTENTIAL
IMPACT FOR
NORTHERN IRELAND
OF WIDER
AIR TRANSPORT
ISSUES ON
THE ISLAND
OF IRELAND
While recognising that Dublin is a major European
capital city and that there are certain obvious differences in
terms of exchange rate, VAT levels and taxation in respect of
air travel which perceptibly favour Dublin, there is an obvious
opportunity to grow the route network from Belfast to the economic
benefit of Northern Ireland as a region. However, the home market
is finite and it is essential that the Northern Ireland authorities
adopt a strategic view in order to optimise the use of key assets.
It is evident that there has been a strategic approach deployed
towards transport infrastructure development in the Republic of
Ireland (and in Wales, where a 15-year £8 billion integrated
transport programme has recently been announced combining air,
road and rail developments). We regard it as essential that the
Northern Ireland authorities mirror this approach and support
the growth of activity at BIA by ensuring that road access development
from all key commercial towns and cities within Northern Ireland
keeps pace with BIA's air network growth.
CONCLUSION
easyJet would like to thank the Committee again
for the opportunity to contribute towards this vital issue for
Northern Ireland. We will be available to expand upon our thoughts
and aspirations towards the Northern Ireland market should you
wish to do so.
25 January 2005
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