Soaring ambition for £47m air hub

DHIA Al-Ani, the tourism entrepreneur behind the launch of the new low-cost airline Air-Scotland, will oversee a £47m investment in the venture as part of plans to turn Scotland into a transport ‘hub’ for travel to Spain, Belgium and Scandinavia.

The airline, a joint venture with privately owned Athens firm Electra Airlines, announced plans this week to fly to six Spanish destinations from Edinburgh and Glasgow with fares starting from as little as £25.

It says it will generate over £170m for the Scottish economy over the next five years, and create around 850 jobs directly and indirectly.

Al-Ani told Scotland on Sunday the launch was part of wider plans to create a hub in Scotland and that he was seeking talks with Ryanair, easyJet, VisitScotland and the Scottish Executive towards this end.

Passenger numbers at UK airports have grown from 58 million in 1980 to 180 million in 2000 and are set to grow further as more and more people travel by air. The last government study forecast further growth to 275 million in 2010, 400 million in 2020 and 500 million or more by 2030.

Al-Ani suggested that more travellers from Belgium and Scandinavia would travel to Scotland in order to take advantage of the cheaper flights available here to journey on elsewhere in Europe.

The airline will publicly launch its services in Spain next month and Al-Ani said he hoped to have a dedicated travel centre in Spain established in two or three years to encourage trade there.

He said: "We are hoping to create a kind of hub in Scotland for flights from other countries such as Scandinavia and Belgium.

"There are a limited amount of holidays in these places, so we will promote the idea that people can travel to Scotland to travel onwards.

"There are a lot of people in Spain who want to come to Scotland, but they don’t want to travel through London. We are interested in developing inbound as well as outbound traffic."

He is confident that rival operators will listen to his overtures and work with him to establish a hub in Scotland. "We will approach easyJet and Ryanair soon, and I’m sure that economic sense will prevail," he said.

Despite concerns over fewer people travelling following September 11, it appears that more people than ever are keen to travel by air.

Figures released by airports group BAA show that in 2002, 17.3 million passengers travelled through Glasgow, Edinburgh and Aberdeen airports - up from 15.9 million in 2001.

Schiphol, Holland’s main airport, acts as a European hub for the world’s carriers and around 890,000 Scots travelled to the Amsterdam airport last year, with the majority travelling to get onward connections.

Al-Ani plans to develop Scotland broadly along the same lines, although he faces considerable hurdles in Scotland’s transport infrastructure, which is inadequate at present.

Neither Glasgow nor Edinburgh airports have a direct train route to their city centres, although the transport minister Iain Gray said at the start of the year he was committed to providing links to both.

The Westminster government is also undertaking a strategic review of UK airports, and both Edinburgh and Glasgow have been earmarked for an extra runway, although only one will be expanded.

Amanda Forsyth, a fund manager at Standard Life, said Air-Scotland’s plans to develop a hub in Scotland required considerable investment. "It would mean a step change in the transport infrastructure in Scotland. It’s good that people have visions, but if he plans to make Scotland a hub for Scandinavia, it becomes a much riskier proposition."

The plans could also face challenges through charging policies, or the fees that carriers have to pay to the airport for every passenger who travels there.

Airlines, politicians and business leaders have united in the past to criticise Glasgow and Edinburgh airports over the cost of these landing charges.

For example, on domestic UK flights, airlines are charged £8.36 per passenger for using Glasgow and Edinburgh airport, while Stansted and Gatwick charge only £4.20. Charges in international flights are also higher at these airports than at some south of the Border.

Al-Ani said Edinburgh and Glasgow airports had been helpful so far in his attempts to establish his services.

A spokesperson for BAA said Al-Ani’s plans were feasible and pointed out that services were already being run between Scotland and Scandinavia.

Observers say that before Scotland is reinvented as a hub, Air-Scotland will first have to prove itself a success in Scotland’s highly competitive low-cost airline market.

Al-Ani said he was unconcerned by sceptics and that his planes would begin flying to Spain in March. He said: "I’m not nervous or worried. I know that other people have tried it and it didn’t work, but we are always able to learn from others’ mistakes. I’m sure that it will be a great success."

Kathryn Munroe, head of Ryanair’s Scottish affairs, said: "The market isn’t big enough. "


Briefing

THE 1930s witnessed a boom in air travel in Scotland, and ever since, a host of airlines has come and gone. Loganair became a franchise partner of British Airways, while Air Ecosse has disappeared altogether. Highland Express operated between Prestwick and New York for a few months before folding in the 1980s.

That leaves us with the successful ScotAirways, the carrier that began as Suckling Airways, and which runs 27 flights a day between Edinburgh and Dundee and London, Southampton and Guernsey.