IRE­LAND & IN­DIA

Ire­land has been a pi­o­neer of sorts in avi­a­tion and air­craft leas­ing in­dus­try due to the full sup­port from its gov­ern­ment. With ex­per­tise in all avi­a­tion re­lated ac­tiv­i­ties, Ire­land is of­fer­ing busi­ness op­por­tu­ni­ties to In­dia. In an ex­clu­sive in­ter­view wi

SP's Airbuz - - Table Of Contents - EX­CLU­SIVE

Jayant Baran­wal ( JB): Could you tell us how Ire­land has reached the peak in avi­a­tion and in how much time? Pat Breen (Breen): Ire­land be­ing an is­land na­tion, there are only two ways to get out, ei­ther by air or by sea. Our ge­o­graphic lo­ca­tion is such, the most west­erly coun­tries in Europe, air­lines en route to Europe have to stop by. Air­lines in the early days stopped off in Ire­land en route to Europe. Of course, the early pi­o­neers also stopped in Ire­land, as in the first Trans At­lantic flight crossed to Europe. Our his­tory of be­ing pi­o­neer in avi­a­tion is some­thing spe­cial to us. Our air­ports started gath­er­ing mo­men­tum in Dublin, Shannon, Cork air­ports. So I sup­pose this has come from a num­ber of en­trepreneurs and pi­o­neers in avi­a­tion and I go back to some­body like Dr Tony Ryan who started off Guin­ness Peat Avi­a­tion (GPA). And then there is the growth of Aer Lin­gus, our na­tional car­rier. So we had a lot of ex­per­tise and en­trepreneurs work­ing with GPA. At one time in the 1980s, GPA was the largest leas­ing com­pany of air­craft in the world.

Back in the 1970s, fly­ing and avi­a­tion was quite ex­pen­sive and Dr Ryan had the vi­sion to start this com­pany and he was joined by a num­ber of very dy­namic and young peo­ple who wanted to ex­cel them­selves in the avi­a­tion sec­tor, peo­ple like Michael O’Leary who founded Ryan air. Out of Guin­ness Peat Avi­a­tion came Ryan Air which was called af­ter Dr Tony Ryan. Of course, Ryan Air started as a very low-cost air­line, based on the South-East­ern model in the US. Low-cost was very new at that time, a lot of the tra­di­tional air­lines had their car­tel charg­ing what­ever they liked. In those years, to cross to the UK it used to cost 400 pounds, to­day you can get it for as lit­tle as 20 pounds each way that is what has hap­pened with com­pe­ti­tion.

That is how low-cost car­ri­ers have made a big dif­fer­ence to us and that model was copied by car­ri­ers in Europe. So where are we now? The Ir­ish avi­a­tion busi­ness is at a very strong point, strong not just in leas­ing. We lease over half the air­craft in the world from com­pa­nies like GE Cap­i­tal Avi­a­tion Ser­vices (GECAS), Aer­cap and var­i­ous other smaller leas­ing com­pa­nies and of course Avolon which had Domh­nal Slattery, a very good friend of mine from my own county who was the CEO. The tra­di­tion was there, the en­trepreneur­ship was there. Our other area of ex­per­tise has been in the main­te­nance of air­craft and paint­ing of liv­er­ies. We have Shannon MRO, Shannon Aerospace and they are do­ing ex­tremely well. We have got very good skilled work­ers. We get air­craft from all over the world, for main­te­nance and paint­ing liv­ery. Qatar Air­ways, Amer­i­can Air­lines among oth­ers get work done here.

At the mo­ment the avi­a­tion sec­tor is go­ing through a tran­si­tion. We have Patrick from Shannon Air­port Au­thor­ity on this del­e­ga­tion. We have made that air­port in­de­pen­dent. It op­er­ates on its own. Shannon air­port had the first duty-free shop in the world; the first Ir­ish cof­fee was made at the air­port; and the first cus­tom free zone in the world is here. From this point of view it makes us ex­perts in avi­a­tion. Aer Lin­gus is now part of the In­ter­na­tional Air­lines Group. We are a small coun­try it is dif­fi­cult for a na­tional car­rier to sur­vive, so Aer Lin­gus merged. In the 1990s and 2000, there were merg­ers and con­sol­i­da­tion of Lufthansa, AFI, KLM, Aer Lin­gus, etc, with dif­fer­ent groups.

As we come out of our down­turn in the econ­omy and start grow­ing again, we find that we are one of the fastest grow­ing economies in Europe and avi­a­tion is an im­por­tant sec­tor to grow. We are strong in air­craft main­te­nance, leas­ing, air­craft parts, soft-

WE OF­FER TAX IN­CEN­TIVES FOR AIR­CRAFT TO SET UP AIR­LINE LEAS­ING COM­PA­NIES, TO SET UP MAIN­TE­NANCE AND OTHER AIR­CRAFT RE­LATED COM­PA­NIES. WE SEE THAT IS IM­POR­TANT TO GROW, CLUS­TER GROWTH FROM BOTH THE US SIDE AND THE ASIAN SIDE. — PAT BREEN, IRE­LAND MIN­IS­TER OF STATE FOR EM­PLOY­MENT AND SMALL BUSI­NESS

ware for air­craft. We have de­vel­oped a clus­ter for avi­a­tion in the Mid­west re­gion of Ire­land where Shannon Air­port is and com­pa­nies are in the process of start­ing off new avi­a­tion re­lated in­dus­tries there. We are here in In­dia to show­case this and to bond a friend­ship and re­la­tion­ship be­tween Ire­land and In­dia which is prac­ti­cally a huge coun­try, need­ing con­nec­tiv­ity. JB: In what ways can you help In­dia? Breen: There are a num­ber of ways. We are leas­ing a lot of air­line com­pa­nies. We lease air­craft from Ir­ish com­pa­nies. JB: What kind of sup­port has there been from the gov­ern­ment to your air­lines, to your en­trepreneurs as that could be good bench­mark for In­dia? Breen: First of all, gov­ern­ment sup­port to en­trepreneur­ship is ex­tremely im­por­tant. In the area of sci­ence and tech­nol­ogy we have in­vested to train ap­pren­tice­ship, grad­u­ates and we have en­cour­aged our uni­ver­si­ties to link up with avi­a­tion cour­ses. This is how we are go­ing to move for­ward. We want Ire­land to be a cen­tre of ex­cel­lence for avi­a­tion and the gov­ern­ment is spend­ing money on sci­ence and tech­nol­ogy, in univer­sity cour­ses, and also en­cour­ag­ing air­ports, pro­vid­ing tax in­cen­tives, etc. JB: What kind of tax in­cen­tives? Breen: Tax in­cen­tives for air­craft to set up air­line leas­ing com­pa­nies, to set up main­te­nance and other air­craft re­lated com­pa­nies. We see that is im­por­tant to grow, clus­ter growth from both the US side and the Asian side and that is why we are look­ing at In­dia. We have in­vited the In­dian Civil Avi­a­tion Min­is­ter to visit Ire­land and see what we have to of­fer, not just for the ICT sec­tor but also the avi­a­tion sec­tor. JB: You said to­day it costs 20 eu­ros, does it al­low prof­itabil­ity at such low fares? Patrick from Shannon Air­port (Patrick): It does, be­cause air­lines like Ryan Air and other car­ri­ers are ex­tremely com­pet­i­tive, ex­tremely price fo­cused. We see that hap­pen­ing in the In­dian mar­ket as well. What it means is that they look very closely at all parts of their costs, air­port costs very ag­gres­sively, staff costs very ag­gres­sively, and they take each of these slices of the pie and squeeze each of them and that has this re­sult. Breen: The air­lines will make up this with ex­pen­sive seats as well with last minute book­ings. Patrick: If I have to travel to­mor­row I will not get the 20-euro fare. Also I will get cof­fee for 20 euro and my suit­case will be charged. Breen: Also the fare dur­ing cer­tain times of the day are dif­fer­ent, early morn­ing flights for busi­ness peo­ple go­ing out are not cheaper, so also late night flights into London. They have rev­o­lu­tionised the whole costs and brought down costs. There is fierce com­pe­ti­tion on the Ir­ish routes to London. It is not just with the two air­lines from Ire­land. We have Bri­tish Air­ways fly­ing in and also a num­ber of smaller air­lines fly­ing into the re­gional area as well as UK. Patrick: This has big im­pact on air­ports and the many in­cum­bent air­ports are be­ing chal­lenged. Many of the air­lines have started fly­ing into these smaller sec­ondary air­ports which maybe 50 miles (80 km) away and the con­sumers have been ed­u­cated. Breen: That has put chal­lenges on Shannon Air­port to bring down their air­port costs too. JB: The air­ports are much friendly in terms of costs... Patrick: They have got to be, they are not mo­nop­oly sup­pli­ers of air­ports. Breen: They have to de­pend on other sources of rev­enue, be­sides air­lines, leas­ing of shops, charg­ing for car park, etc, it is a com­bi­na­tion of is­sues. Patrick: You were ask­ing how Ire­land can help In­dia. Some of the ways we can help is bring leas­ing busi­ness, can help air­craft avail­abil­ity through leas­ing to the In­dian mar­ket. Some of the other ar­eas we are strong in is avi­a­tion ed­u­ca­tion, tech­ni­cal train­ing, train­ing en­gi­neers, pilot train­ing and so on. JB: Qual­ity train­ing is cru­cial, zero com­pro­mise in train­ing is a must. Breen: We get crew train­ing from all over the world. We are a cen­tre of ex­cel­lence in that area. There is very suc­cess­ful com­pany in Dublin which makes seats for air­craft, also soft­ware for air­craft. We want to help out in coun­tries as well and to grow and it is an area we are de­vel­op­ing and for­mu­lat­ing a pol­icy. Patrick: One of the rea­sons for our in­dus­try to be suc­cess­ful is due to the enlightened gov­ern­ment pol­icy and to a very prag­matic avi­a­tion reg­u­la­tor. Our avi­a­tion reg­u­la­tor has been very sup­port­ive of the in­dus­try. Safety is ab­so­lute top pri­or­ity and they are com­mer­cially aware and they help the in­dus­try. For ex­am­ple, In­dia is plan­ning to build a civil air­craft un­der ‘Make in In­dia’ and Ire­land could help in many ways and the Ir­ish reg­u­la­tor can help in cer­ti­fy­ing the air­craft. Breen: Our skills are very im­por­tant that is why we are so suc­cess­ful in air­craft main­te­nance. Even though we are not a low-cost econ­omy, we have a lot of air­lines com­ing to us be­cause of the good job we do. JB: How is the busi­ness avi­a­tion do­ing in Ire­land? Breen: Busi­ness avi­a­tion is small. We have a num­ber of op­er­a­tors but they are small. JB: Does it con­trib­ute to your re­gional con­nec­tiv­ity? Breen: It does. For re­gional con­nec­tiv­ity, we are sub­si­dis­ing. The gov­ern­ment gives the in­dus­try sub­si­dies to fly in to west­ern re­gion, north-east, south-east. We fly smaller tur­bo­prop air­craft into those re­gions. JB: What kind of air­craft? Patrick: Like the ATR 72. Breen: We have to main­tain re­gional bal­ance and en­sure that these re­gions are not dis­ad­van­taged. So we have the PSO sub­sidy and it is quite ex­pen­sive for the gov­ern­ment, but it is good for re­gional devel­op­ment.

ONE OF THE REA­SONS FOR OUR IN­DUS­TRY TO BE SUC­CESS­FUL IS DUE TO THE ENLIGHTENED GOV­ERN­MENT POL­ICY AND TO A VERY PRAG­MATIC AVI­A­TION REG­U­LA­TOR. OUR AVI­A­TION REG­U­LA­TOR HAS BEEN VERY SUP­PORT­IVE OF THE IN­DUS­TRY. — PATRICK EDMOND, SHANNON AIR­PORT

PAT BREEN, Ire­land Min­is­ter of State for Em­ploy­ment and Small Busi­ness

Newspapers in English

Newspapers from India

© PressReader. All rights reserved.