Over-capacity on lifeline air routes is a car crash waiting to happen, the boss of one island air operator told a Tynwald scrutiny committee.
Noel Hayes, chairman of newly-launched Citywing – born out of management buy-out of Manx2 – was giving evidence to the economic policy review committee which is investigating the government’s open skies policy.
Referring to the competition between easyJet and Flybe on the Liverpool and Gatwick routes, he said: ‘On no route has two operators co-existed for a protracted period of time. I suggest it’s a car crash waiting to happen.
‘One will withdraw – I can’t say which operators and I can’t say when. Both are waiting for the other to blink.’
The scrutiny committee inquiry is examining whether the policy, which allows airlines free access to fly routes to and from Ronaldsway, still serves the best interests of the Isle of Man.
Critics argue that the open skies approach can allow an airline to take on an established route for just a few busy lucrative months, take the profits off that busy route and leave the existing all-year-round carrier in severe difficulties.
Mr Hayes, who was giving evidence alongside Citywing’s managing director David Buck, explained that he supported the general principle of open skies but with reservations.
He suggested there should be a half-way house between the open skies approach and the closed skies policy as adopted in Guernsey where there is state-owned airline.
‘I think there should be a presumption that a licence will be issued but over that presumption there should be an over-riding clause with words to the effect ‘unless it’s not in the national interest’,’ Mr Hayes said.
He said at present there was no security of tenure for carriers – and no incentive to invest long-term in their routes.
‘There is no incentive in building up an airlink because tomorrow somebody else could come along,’ he said.
Mr Hayes suggested that an operator who came in to start a completely new route should be charged a discounted rate while one that came in as a competitor on an existing route should pay a higher charge.
Mr Buck said the biggest change since the open skies policy was introduced in 2002 was the reduction in the number of carriers.
He said there had once been a lot of players in the UK but it was now dominated by three or four carriers. ‘When one of those carriers decided to move, the Isle of Man finds itself in a very difficult situation, London City was a case in point. It’s very fortunate BA came in - if they hadn’t I suggest there would not have been any others. In 2002 when the open skies policy was originally drawn up there may have been another 10 players.’
Representatives from Flybe and easyJet were due to give evidence at the same hearing but are now due appear before the committee on May 15.
