Dublin Airport should prepare for growth now to avoid playing catch-up
TOURISM played a key role in creating jobs after the financial crash, but the sector’s long-term post-pandemic revival could be hampered if key infrastructure projects at Dublin Airport – the country’s busiest gateway – are put on ice.
The chief executive of the Dublin Airport Authority (DAA), the semi-State company that operates Dublin and Cork airports, yesterday told staff of stark decisions the firm needs to rapidly make in the face of a collapse in air traffic.
The measures will involve hundreds of job losses and the DAA’s boss, Dalton Philips, said a review of a slate of major projects at Dublin Airport that were designed to future-proof its capacity, after years of strong passenger growth, is also necessary.
Dublin Airport handled 32.9 million passengers last year, while Cork Airport handled 2.6 million.
Mr Philips told staff in a blunt letter it could be “several years” before passenger traffic at the gateways is back at levels seen in 2019.
He said the combined traffic at the two airports might be as low as 21 million passengers in 2021.
“This economic crisis is serious, and we need to take action quickly, but we will work collaboratively with you and staff representatives to achieve the necessary cost savings,” Mr Philips said.
“This, inevitably, will involve a substantial resizing of our business, new ways of working and significantly fewer employees. It is likely that reductions in staffing will have to apply throughout the business,” he added.
Mr Philips said work on a new runway project at Dublin Airport will be completed, as will installation of a mandatory baggage screening system and other core maintenance.
All other projects that are part of a €2bn infrastructure spend at the airport will be reviewed.
Those projects were all aimed at increasing aircraft and passenger capacity at the airport, and making it more efficient.
The schemes were designed to make Dublin Airport capable of comfortably handling 40 million or more passengers a year.
While it will be some time before passenger numbers recover to 2019 levels, there is a chance now for Dublin Airport to get ahead of the curve and be prepared for growth when it comes, rather than playing catch-up.
Rolling out the infrastructure so it’s there when demand does recover
– and it eventually will – would not only provide much-needed jobs during the aftermath of the pandemic, but also make sure the gateway is able to capture and manage growth opportunities when they come.
The DAA is a commercial entity – it borrows money to help build infrastructure, it must turn a profit to fund its activities and all the while pay a dividend to the State.
But with the financial floodgates open and the EU’s State aid rule book having been tossed out the window, it’s not an inconceivable notion that the Government could line up cheaply-borrowed funds that the DAA could access.
It’s impossible to know when air travel will rebound. But this downturn too will pass.
Ireland still lacks much of the kind of infrastructure that modern economies need.
This could be a chance to try to eliminate that deficit and lay the foundations for recovery.