Low-cost airlines defy the gloom

Andrew Clark
Tuesday April 12, 2005

Britain's seemingly insatiable appetite for low-cost flights pushed passenger numbers up by 6% to 141m at BAA's seven airports during the last financial year.

The airport operator revealed that the number of budget airline travellers passing through its terminals jumped by 14.8% in the year to March, offsetting a 6.7% decline in holiday charters to Europe.

Passenger numbers surged despite continuing woe for airlines, which are struggling to cope with record oil prices and high security costs.

Analysts expect the company to make operating profits of 690m for the financial year, against 616m a year ago.

A BAA spokesman said passenger traffic looked particularly positive because it was measured against a weak period in 2003, when Sars and the war in Iraq depressed demand for international travel.

Airlines often accuse the company of overcharging. But BAA's spokesman pointed out that the firm had invested 1.5bn in new facilities: "That's why we have to make this scale of returns - because of the huge investment we're putting in."

Among BAA's fastest growing airports was Gatwick, which enjoyed a 15% year-on-year rise during March and saw its annual passenger numbers exceed 32m for the first time since September 11 2001.

Gatwick has benefited from new routes added by easyJet and Ryanair. The airport had suffered from a scaling back in British Airways' operations as the national carrier shifted services to Heathrow. Stansted's passenger numbers grew by 9% in the year to 21m, Heathrow was up 5.3% to 67m, Glasgow rose by 5.7% to 8.6m and Edinburgh edged up 6.2% to 8m.

Papers published yesterday by OAG, an aviation research firm, disclosed that low-cost airlines account for 12% of all scheduled flights worldwide and 15% of available seats. OAG calculated that budget carriers would account for 300,000 flights this month, with nearly 38m tickets on the market.

Duncan Alexander, OAG's managing director of business development, said: "The low-cost phenomenon continues to break all records. Compared with this time last year, low-fare airlines are this month operating 19% more flights."

Guardian Unlimited Guardian Newspapers Limited 2005