‘Airline collapses inevitable’

JERSEY must not be ‘complacent’ about its travel links, as further airline collapses are ‘inevitable’ following the Covid-19 outbreak, business leaders have been warned.

Matt Thomas, Ports of Jersey chief executive. Picture: ROB CURRIE. (31853141)
Matt Thomas, Ports of Jersey chief executive. Picture: ROB CURRIE. (31853141)

At yesterday’s Chamber of Commerce lunch, Matt Thomas, chief executive of Ports of Jersey, said he did not expect air travel to bounce back to pre-pandemic levels until 2023 but that neither did he anticipate sharp price rises as carriers would have to remain competitive.

Mr Thomas admitted that further airline collapses could damage the Island’s connectivity unless proactive steps were taken to secure travel links.

He also praised the efforts of Islanders during the pandemic, which he described as a ‘rollercoaster ride’ for the travel industry.

He said that up to a third of Ports employees were redeployed to aid the emergency response. These included Airport firefighters who were reassigned to drive ambulances and security officers who worked in customer care at the Hospital.

Mr Thomas said that as the Island was now in a better position in relation to Covid-19, the Airport was now seeing passenger traffic at around 70% of 2019 levels, compared to a figure of 45% in the UK.

But he added that other airlines were likely to suffer the same fate as Flybe, which collapsed early in the pandemic, and the Island’s connectivity was at risk.

He said: ‘I have just spent three days in Milan with the world’s airlines, airports, investors and governments. The takeaways were clear.

‘No airline has been immune, including those that serve Jersey. Further rationalisation in the sector is coming and further collapses are inevitable. There is simply no room for complacency regarding our connectivity.

‘That said, I believe that we should continue to tackle the challenge head on and with confidence. While the pandemic has had an enormous impact on Jersey’s connectivity, the recovery in our passenger numbers is well ahead that of other UK airports.’

And discussing possible price rises to combat the losses airlines have suffered as a result of the pandemic, Mr Thomas said that ‘their debts are going to have to be dealt with and that makes you think there will be price rises but the market won’t take it’.

He added that airlines were focusing on survival, rather than market share, and that this would involve ‘reassessing’ their travel routes.

‘We have worked incredibly hard, in close partnership with our carriers, to seize opportunities and to manage risk. We have introduced new airlines, such as Jet2, BA CityFlyer, Loganair and Eastern Airways, and new routes to the likes of Stansted, Corsica and Ibiza,’ he said.

‘We are also benefitting from direct connectivity to much more of the rest of the world as British Airways has temporarily transferred its operation to Heathrow. But we need to do more. As an island, we need to be agile, decisive and as competitive as possible.

‘Airlines are reassessing their networks, approaching their businesses from a “start-up” perspective, with a clear focus on profitability and sustainability, rather than market share.’

Mr Thomas said that the loss of Flybe last year had left Ports of Jersey with a ‘bad [unrecoverable] debt’ and resulted in a loss of 30% of the Island’s air-travel capacity in a ‘heartbeat’.

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