Air fares to increase from ‘unsustainable’ levels
Keegan MurrayThe cost of flying to and from Sumburgh will increase in coming months, Loganair’s managing director has admitted.
Jonathan Hinkles broke the news at a meeting of Shetland’s External Transport Forum on Monday in which he reiterated claims that competition on Shetland routes had driven air fares down to “unsustainable levels”.
His comments come after news broke last week that Flybe is set to pull out of its Shetland routes from 8th January with disappointing passenger numbers and fares plummeting between 20 and 40 per cent being linked to the decision.
Speaking after Monday’s meeting Mr Hinkles said: “I think certainly what we have seen with the number of seats priced at the level they are is that it’s unsustainable at those levels, particularly with a £50 fare.”
He said that on some flights these low fares, for customers using the isles’ Air Discount Scheme, were just enough to cover the various taxes and charges an airline incurs without factoring in further costs such as fuel and crew members’ wages.
“I don’t think it will come as a surprise that that’s unsustainable for an airline, hence why one of them has left”, he said.
Both airlines had suffered substantial losses during this period and the unsustainable fares were further compounded by a glut of available seats, Mr Hinkles said.
In November for every one seat filled by the two airlines there were two vacant. In October around 28,000 seats were available, roughly double what was available during the same period last year, yet the number of customers only increased by 3,500.
An announcement on fare pricing is expected in the “next two or three weeks”, Mr Hinkles said, adding that he hoped to find a “middle ground” between the unsustainable fares introduced when the airlines locked horns and the high fares which inspired then Tagon Stores owner Scott Preston to launch a campaign for cheaper air travel in 2015.
• For more see Friday’s Shetland Times
Johan Adamson
Lots of questions about this:
“He said that on some flights these low fares, for customers using the isles’ Air Discount Scheme, were just enough to cover the various taxes and charges an airline incurs without factoring in further costs such as fuel and crew members’ wages.” But they surely get the ADS money then from the government as well?
Is this because they based the figures for Shetland on passenger numbers during the gas plant construction, which was always going to be short-term?
Will Loganair be able to invest in new planes once they have flown solo to Sumburgh for a time?
David Spence
It will be interesting to compare the cost of an airline ticket with the islanders discount and one without the islanders discount?
I suspect they will probably be the same in price, once you take into consideration all the hidden costs, what time you booked the ticket online or by phone or by letter, what seat you have, if the seat is near a window, what weight you are, what weight your baggage is (price increasing from weight zero) allowed to have put onto the ticket with the islanders discount. lol
When Loganair says ‘ Price increases ‘ does this equate to, in affect, the islanders discount being worthless in real terms?