Europe’s smaller airports are facing a critical situation, as stated by the head of the Airports Council of Europe. Olivier Jankovec, the director general of ACI Europe, has raised concerns that some of these smaller airports may not be able to survive if shortages of jet fuel, caused by the ongoing crisis in the Middle East, lead to widespread cancellations of flights.
Following the closure of the Strait of Hormuz during the Iran War, the cost of jet fuel has skyrocketed, resulting in numerous flight cancellations by airlines. Regional airports are particularly vulnerable to capacity cuts and fare increases by airlines, given that demand on their routes is typically more sensitive to price fluctuations compared to larger airports. This vulnerability has been exacerbated by the impact of the COVID-19 pandemic, leaving some regional airports operating at 30% below their 2019 levels, as highlighted by Mr. Jankovec.
According to the aviation chief’s statement to the Guardian, the current high jet fuel prices and the potential for a new economic crisis pose a double threat to many regional airports across Europe. This combination of factors presents an existential challenge for these airports.
Conversely, major airports in Europe, like Heathrow in the UK, are dealing with a different issue. With the ongoing conflict in the Middle East leading to increased demand for connecting flights, Heathrow’s chief financial officer, Sally Ding, has emphasized that the airport is operating at full capacity. The surge in transfer passengers, driven by airspace closures related to the Iran conflict, is expected to persist amid geopolitical uncertainties, impacting competition from airports like Dubai.
Heathrow’s current trading update acknowledged the temporary absorption of demand from other sources due to the conflict in the Middle East. However, the airport foresees potential impacts on passenger numbers for the remainder of the year, given the significant uncertainty prevailing in the region.
As the debate over the approval of a third runway at Heathrow continues, Ding warned that the airport’s limited operating capacity could lead to fewer options and higher costs for passengers, as well as missed economic opportunities for the UK. Heathrow’s proposed £50 billion expansion plan, which includes a new 3.5-kilometer runway, aims to significantly increase passenger capacity and flight numbers, subject to regulatory and government support.
Heathrow emphasized its readiness to invest, expand, and maintain the UK’s global connectivity with the right regulatory backing. The airport’s expansion project involves reconfiguring a section of the M25, London’s orbital motorway, by diverting it underground. While a competing £25 billion proposal by the Arora Group was rejected in favor of Heathrow’s plan, the airport’s expansion has faced delays pending a government review of its overarching aviation strategy, expected later in the year.