Shannon Aer Lingus Row

Villain

Well it looks like the Government are going to dig their heels in here, Dempsey has apparently said people in the Shannon region *"might be exaggerating the impact of the decision by Aer Lingus" which they may well be but I don't think a Minsiter saying that publicly is going to help matters at the minute.

Back Benchers seem to coming out pretty strong and any cabinet would be very foolish to ignore them, the Government kept a 25% share after they sold off Aer Lingus however they seem to be a silent share owner in this case.

*"Mr Dempsey also said that while the company's move was not in line with the Government's regional policy it was made by Aer Lingus on a commercial basis" My ass it is, its more political than anything else imo the North are looking to grow now that powersharing has been setup and I'm sure this decision has been helped in the backround by the Government to show Europe that Belfast is place to do business now, only problem is its at the expense of the West of Ireland.

*Quotes from RTE.ie

lostexpectation

irish1 wrote:

Well it looks like the Government are going to dig their heels in here, Dempsey has apparently said people in the Shannon region *"might be exaggerating the impact of the decision by Aer Lingus" which they may well be but I don't think a Minsiter saying that publicly is going to help matters at the minute.

does this help, willie odea calling mannion a latter day cromwell, might that be the exgeration he's talking about?

mike65

The government should remain 'disinterested', a decision was made to privatise the company so the management must be allowed to manage.

Mike.

Villain

Was it really a company decision though or was it governmend led?

is_that_so

If it was September and there were other serious things to discuss then this would be a no more than a storm in a teacup. I find myself agreeing with Dempsey. Aer Lingus are fully entitled to make commercial decisions. I also find it bizarre that usually staid CEOs would come out with apocalyptic warnings about their businesses. They can't be up to very much if their business is based on some landing slots to one airport by just one of the airlines that services the airport. Pure hyperbole IMO.

As for O'Dea, well enough said, really not fit to be a minister in my book. All about having a minister or two in the southwest.

Villain

is_that_so wrote:

I also find it bizarre that usually staid CEOs would come out with apocalyptic warnings about their businesses. They can't be up to very much if their business is based on some landing slots to one airport by just one of the airlines that services the airport. Pure hyperbole IMO.

They may be overstating it but those landing slots are not just a connection to London the Majority of International travel from Ireland and the UK to the rest of the world goes through Heathrow the use of those slots was a major issue when the Government decided to privatise the company and I find it very hard to accept that the deicision to move those slots to Belfast is purely a commercial decision.

is_that_so

irish1 wrote:

They may be overstating it but those landing slots are not just a connection to London the Majority of International travel from Ireland and the UK to the rest of the world goes through Heathrow the use of those slots was a major issue when the Government decided to privatise the company and I find it very hard to accept that the deicision to move those slots to Belfast is purely a commercial decision.

London has three other airports excluding Heathrow with onward connections.
The Aer Lingus decision also gives them a hub in "the UK" at an airport that still has smallish passenger numbers, notwithstanding the tourist potential. Plus the fact that it is within 2 hours of the north and east of the country.
They obviously see a lot of potential and profit there.

Much of the criticism has come out of the midwest region itself and they have been spectacularly vociferous on the stopover as any of us who've gone across the pond adn been forced to stop, can attest to.

lostexpectation

irish1 wrote:

They may be overstating it but those landing slots are not just a connection to London the Majority of International travel from Ireland and the UK to the rest of the world goes through Heathrow the use of those slots was a major issue when the Government decided to privatise the company and I find it very hard to accept that the deicision to move those slots to Belfast is purely a commercial decision.

when did the gov get the slots and when did they lose control of them?

was it four slots, what does that mean in practical terms, can aer lingus now use those slots not for belfast but for other routes entirely? I guess its already the case that the slots aren't being used for belfast but for aer lingus internatioal with belfast just being the garage for the planes?

J.S. Pill

is_that_so wrote:

If it was September and there were other serious things to discuss then this would be a no more than a storm in a teacup. I find myself agreeing with Dempsey. Aer Lingus are fully entitled to make commercial decisions. .

I've seen absolutely sh!t all detail on the commercial background to the decision. The papers refer to a 'commercial decision' but don't elaborate any further. Would anyone care to enlighten us?

is_that_so wrote:

I also find it bizarre that usually staid CEOs would come out with apocalyptic warnings about their businesses. They can't be up to very much if their business is based on some landing slots to one airport by just one of the airlines that services the airport. Pure hyperbole IMO

I'm not surprised at all. Just think back to the apocalyptic warnings from the hospitality indistry that abounded after the smoking ban was announced.

mike65

The Shannon managment came out yesterday and said they could proberly find 4 million euro in savings for Aer Lingus per annum, maybe that'll temp them back, depends what the savings are in Belfast I guess.

Mike.

Villain

If this was about money I'm sure Aer Lingus would have released a statment showing the figures imo its about giving the North some help and tbh thats a great thing but it shouldn't be at the expense of the West.

Akrasia

mike65 wrote:

The government should remain 'disinterested', a decision was made to privatise the company so the management must be allowed to manage.

Mike.

A decision was made to privatise, but a decision was also made to keep a 25% stake in order to retain influence.

Are you now saying that the Government should stand back and allow an essential transport link be removed from the west of Ireland

(Imagine if the owners of the west link toll bridge, a private company, decided they'd make more money by closing off the motorway and opening up a starbucks franchise)

Akrasia

irish1 wrote:

If this was about money I'm sure Aer Lingus would have released a statment showing the figures imo its about giving the North some help and tbh thats a great thing but it shouldn't be at the expense of the West.

No its not. Aer Lingus couldn't give a sh1t about northern politics. This is part of a long term strategy to set up a hub in belfast airport. Politics doesn't come into this, its all about money. They're a private company. and the government isn't even the biggest shareholder. Why would they do this just to prop up N.Ireland? Any CEO who tried to do something like that against the financial interests of the corporations and against the wishes of the shareholders, he would be acting ultra vires and liable for criminal damages

WeeDiddly

Akrasia wrote:

Are you now saying that the Government should stand back and allow an essential transport link be removed from the west of Ireland

(Imagine if the owners of the west link toll bridge, a private company, decided they'd make more money by closing off the motorway and opening up a starbucks franchise)

If it was Dublin airport, you'd find the likes of Dempsey, Fianna Fail & Co. would be quicker to step in and uphold there 1/4 share.

Zebra3

Akrasia wrote:

No its not. Aer Lingus couldn't give a sh1t about northern politics. This is part of a long term strategy to set up a hub in belfast airport. Politics doesn't come into this, its all about money. They're a private company. and the government isn't even the biggest shareholder. Why would they do this just to prop up N.Ireland? Any CEO who tried to do something like that against the financial interests of the corporations and against the wishes of the shareholders, he would be acting ultra vires and liable for criminal damages

Nail on head.

The state owns 25% of the shares in AL, not 51%.

If you voted FF and are pissed off at the decision by AL, tough.

You reap what you sow.

mike65

Akrasia wrote:

A decision was made to privatise, but a decision was also made to keep a 25% stake in order to retain influence.

Are you now saying that the Government should stand back and allow an essential transport link be removed from the west of Ireland

If the government was seriously pushed about influence they would'nt have sold 75% of it off or indeed any of it off. Also markets as a rule abhore a vacumn, lets see if another airline pops up with fresh services into London. Maybe not Heathrow but many would say 'who needs Heathrow?' these days.

Anyone else find it buscuit taking that Ryanair (the uber-capitalists of modern Ireland) should suggest they and the government link up to stop Aer Lingus managment? Michael O'Leary would rightly go balastic if the boot were on the other foot.

Mike.

mickger

Zebra3 wrote:

Nail on head.

The state owns 25% of the shares in AL, not 51%.

If you voted FF and are pissed off at the decision by AL, tough.

You reap what you sow.

Agree 100%

WeeDiddly

Zebra3 wrote:

Nail on head.

The state owns 25% of the shares in AL, not 51%.

If you voted FF and are pissed off at the decision by AL, tough.

You reap what you sow.

Exactly.

Sinn Féin had a good point when they spoke out against privatisation of powerful companies like this. Maybe, I didn't agree with them saying they were going to re-nationalise it, but what did FF expect after selling Eircom, etc. I would have thought it being a lesson learnt after what happened to Telecom Éireann.

And whats worse than that is that since 1939, the Irish Government and the tax payers is what kept Aer Lingus in the air, now it's privatised, and they move everyhting straight out of the country. the thing I'm gonna do now, is not book any flights with the company and if everyone does the same, it'll plunge them worse than ever before!

Zebra3

Yeah, they've moved eveything out of the country. :rolleyes:

If AL are more profitable running those routes from Belfast rather than Shannon, the taxpayer will gain from higher profits through its 25% holding in AL. :cool:

Richard

Zebra3 wrote:

Yeah, they've moved eveything out of the country. :rolleyes:

If AL are more profitable running those routes from Belfast rather than Shannon, the taxpayer will gain from higher profits through its 25% holding in AL. :cool:

But won't the Irish taxpayer lose revenue, given that the Belfast to Heathrow flights take off and land in the UK, meaning applicable tax revenue goes to Westminster.

Zebra3

Well, at the end of the day it's making the skies around Shannon less polluted. Enviroment is very "in" these days.

Mucco

I've two comments on this.

Firstly, I read that Ryanair are against the move, as they own 25% of the shares, and the state also own 25% of the shares, it could be easily blocked.

Secondly, Heathrow is by far the worst airport in London. Kitty Ussher, the City minister said that many business people will do anything to avoid going through the airport. In my opinion, City airport is best, then Gatwick. All the airports have good transport links. So what's this obsession with Heathrow?

Villain

Because it has more international connections than any other airport, one news item during the week said that 70% of all international flights to destinations outside europe from Ireland and the UK go through Heathrow, I'm not sure if that stat is true but I do know anytime I have flown to outside Europe it was through Heathrow.

Liam Byrne

Zebra3 wrote:

Yeah, they've moved eveything out of the country. :rolleyes:

If AL are more profitable running those routes from Belfast rather than Shannon, the taxpayer will gain from higher profits through its 25% holding in AL. :cool:

That's assuming that the only gains that are relevant to the taxpayer are profits.....

There are a hell of a lot of taxpayers in the west of the country and those taxpayers no longer have a service that either they (when going abroad) or their potential customers (coming to Ireland) can use.

We own 25% of the airline, and the Government (supposedly representing us) is sitting on their collective arses while the Heathrow slots go outside the State juristiction.

Some idiot (and it was the presenter, not a guest) on Today FM fired off a couple of glib comments that they should put "a big road" from Limerick to Cork to use "the brand new terminal there". What an ininformed and biased idiot !

1) There is a road, but unfortunately all motorways in this country lead to Dublin so it takes nearly 2 hours to get the 70 miles to Cork Airport

2) Due to lack of any proper "outside-the-Pale" Government planning and foresight, there isn't even a rail link from Limerick to Shannon, or even a proper 70-mile rail link from Limerick to Cork

3) Even with "a big road" or motorway, I couldn't see de Dubs being happy if they were being told that they'd have to travel to Mountrath (a similar distance to Limerick-Cork) in order to get to London.....in fact, at 104 miles but with the superb motorway, it'd probably be more feasible for the Dubs to get to Belfast......so let's check out that solution:

Dublin got Shannon's stopover - check
Shannon gets Dublin's Aer Fungus Heathrow slots - check (counterbalance the above)
Dubs can still get to Heathrow, based on the Today FM presenter's opinion - check
Mid-West folk can still get to Heathrow - check

The perfect solution! :rolleyes:

4) It's not just Limerick and the Mid-West; a "big road" from Limerick to Cork would do nothing for Galway's tourism and business interests which are currently served by that route

Aer Lingus could have removed a slot from each of the 3 airports and thereby given Belfast 3 slots without causing half as much uproar....unless, of course, the Dubs would be more voiciferous if the issue was affecting their own backyard ?

I think that if the Government had any bottle they'd either (a) force the EGM with Michael O'Leary, thereby actually representing us for a change or (b) sell their 25% stake immediately, crippling Aer Lingus' share price as a punishment, and then invest the money in an airline that is prepared to factor in the well-being of its shareholders into the equation, while also paying for a brand new landing slot at Heathrow that was owned by the State and would be leased at favourable rates to the same airline.

Aer Arann might be worth looking at.

First Telecom Eireann (sell the infrastructure and then regret it) and now Aer Fungus (sell the landing slots and watch them disappear out of the country).....will those idiots if Fianna Failure ever learn ?

is_that_so

WeeDiddly wrote:

Exactly.

And whats worse than that is that since 1939, the Irish Government and the tax payers is what kept Aer Lingus in the air, now it's privatised, and they move everyhting straight out of the country. the thing I'm gonna do now, is not book any flights with the company and if everyone does the same, it'll plunge them worse than ever before!

I think that what you'll find it is expensive flights that kept Aer Lingus in the air. That's one positive that can be drawn from the emergence of Ryanair.
It is also obvious from the stories emerging this morning, excluding the bishops :rolleyes: , that Shannon are actively looking at ways to mitigate the loss of the slots, by searching for alternative airlines.

IMO the whole story has become nothing more than an excuse for local representatives to "appear to be doing something". That and the fact that there is no other news at all.

The days of Shannon being special are over and that has been well-telegraphed for some years. So spluttering outrage on the national airwaves does not conceal the fact that it needs to stand on its own two feet.

is_that_so

Liam Byrne wrote:

I think that if the Government had any bottle they'd either (a) force the EGM with Michael O'Leary, thereby actually representing us for a change or (b) sell their 25% stake immediately, crippling Aer Lingus' share price as a punishment, and then invest the money in an airline that is prepared to factor in the well-being of its shareholders into the equation, while also paying for a brand new landing slot at Heathrow that was owned by the State and would be leased at favourable rates to the same airline.

On what basis? Just because there is much disgruntlement in the midwest.
If as the company has said it was for commercial reasons that is hardly much of a reason to call an EGM. There would certainly be a case to answer for if they pulled slots from Dublin, with its much much larger passenger numbers. But I suspect if they were considering it the DAA would have seen it coming and moved to do something about it.

Belfast makes sense as it has a much larger catchment area. The city alone has 250,000 people in it. Even people as far away as Donegal could consider flying out of Belfast. It also encompasses many of the border counties as well.

As I have already posted it's not as if this hasn't been coming. IMO ,the gnashing of teeth just sums up (not having at a go at the Midwest here ) our usual lack of planning and foresight. Shannon can benefit from this, not by blaming everything since Cromwell for Aer Lingus' departure but by looking on it as an opportunity to develop and grow itself. What's to stop it becoming a hub in its own right?

mike65

Greater Belfast has a population of nearly 600,000 so its plenty big enough as a market in itself.

Mike.

Akrasia

mike65 wrote:

Greater Belfast has a population of nearly 600,000 so its plenty big enough as a market in itself.

Mike.

And Shannon has a catchment of 500,000 (within an hour drive)

Except in belfast, there are 9 other heathrow slots already competing with Aer lingus, while Shannon has none.

Moving the heathrow slots to Belfast is a bad business decision unless they are planning to base their operations there and move more routes to achieve economies of scale. I fully expect Aer Lingus to fully pull out of shannon and move all their U.S. routes to belfast in the coming years.

The CEO has just been on RTE news saying essentially that Aer Lingus doesn't have any responsibility for or loyalty to the Mid West region

Liam Byrne

is_that_so wrote:

On what basis? Just because there is much disgruntlement in the midwest.
If as the company has said it was for commercial reasons that is hardly much of a reason to call an EGM.

The Government is a shareholder and this move is not (on face value) in their interests. If the company is no longer acting in their [our] interests (not surprising, since the Government doesn't even seem to want to ask them to) then they should invest our money somewhere else.

There would certainly be a case to answer for if they pulled slots from Dublin, with its much much larger passenger numbers.

If they pulled ALL slots, yes, but they could easily pull one or two if the rationale is to form a base in Belfast....after all, it's only 90 mins or so up the motorway....similar to Limerick - Cork.

Here's hoping some good comes of this......like the West giving the two-fingers to Aer Fungus and replacing them with someone better. I'd also like to see Aer Fungus go down the tubes in Belfast because they can't fight off the existing competition that they themselves have decided to go head-to-head with.

Regarding Shannon becoming a hub in its own right, or attracting other carriers, that would involve the Government rowing in with proper roads, rail and other infrastructure; if they do that in an effort to help out in this crisis, then better late than never;

The alternative is that there's a revolt at Government inaction and we finally get rid of this inept "we can't do anything about it" coalition like we should have back in May.

Villain

Anybody seen a Green Party member speak on this??? Becomming lapdogs like the PD's were are they?

miju

Akrasia wrote:

And Shannon has a catchment of 500,000 (within an hour drive)

extend Belfasts catchment area by the one hour drive and you've nearly doubled it again thus negating your point.

have to agree with above posters this is all a storm in a teacup because theres nothing better to report on during silly season. the west should just take it on the chin and instead of pissing and moaning and wringing their hands they should be proactive is sorting another airline etc.

all this talk of legal action on AL and lobbying etc is just more and more time wasted when they could be using their efforts to just replace AL with another airline

times change deal with it :rolleyes: