Separation from DAA would aid Shannon, says report

SHANNON AIRPORT’S viability could be enhanced by being separated from the Dublin Airport Authority and placed in a new entity, possibly with other local public bodies, according to a report by consultants Booz for Minister for Transport Leo Varadkar.

Booz recommends new sources of revenue should be explored for Shannon, including the exploitation of its 2,000-acre landbank, a greater focus on cargo, and improved leverage of US customs and border protection clearance facilities to include cargo.

The consultants have also concluded that the need for separation of Cork Airport is “less obvious” given that it is in a “healthier position” financially and more likely to meet the targets set in its business plan.

Booz said the benefits of separation for Cork would be “marginal” as it was performing well under DAA ownership and the requirement for capital investment was “low”.

The report was released last night by the Department of Transport, with large sections blacked out for commercial reasons.

In relation to Shannon, Booz said a move to a local concession model would offer the “greatest opportunities” for developing a niche business there. This would involve the composition of a “local authority holding entity” that could include Clare and Limerick county councils, and possibly Shannon Development.

It also said the allocation of equity in Aer Rianta International, the DAA’s global duty free division, founded in Shannon many years ago, should be “viewed as a point of negotiation for” the airport “in particular”.

Booz said Shannon was faced with the “greatest threat to its future viability” and suggests it be separated from the DAA.

The Booz report highlights how Shannon’s passenger traffic has halved to 1.8 million in the four years to 2010. At Cork, traffic has declined by 30 per cent since its peak in 2008.

Booz argues the Government must first frame an overall policy for Irish airports before deciding the separation issue.

The consultants noted that the country’s six regional airports accounted for 1.1 million passengers in 2009 and said separation would allow Shannon and Cork to compete more aggressively with these airports.

A spokesman for the department said the Minister would make a recommendation to Cabinet on Shannon by Easter, with a decision on Cork to follow at a later date.