Political backing, but will Aurigny plan fly?
SENIOR States members have welcomed ambitious plans to take Aurigny into profit for the first time in 15 years, but admitted that there are no certainties about whether such financial transformation can happen.
States’ Trading Supervisory Board president Peter Roffey and Policy & Resources treasury lead Mark Helyar were both supportive of the airline and the proposed recapitalisation, but expressed doubts whether the company would break even within the next two years.
The airline needs £46.8m. from the States to clear its debts and allow it to move forward with an overhaul of its services and aircraft.
Plans to provide better travel options, boost tourism and potentially offer cheaper fares are among the methods aimed to reduce costs and increase passenger numbers.
Deputy Helyar said that another recapitalisation could not be ruled out in the future, and did not know when there might be results.
‘Who knows when that will be?’ he said.
He added that pandemic could cause the whole policy to be backtracked.
‘There could be another variant next week that could undermine all of this.'
Aurigny chief executive Nico Bezuidenhout took on the role last year, and Deputy Helyar said he had offered a feeling of transparency and ease to the policy-making process.
‘I’m confident in the new leadership – we have been able to have conversations that we haven’t been able to before,’ he said.
Financial losses for 2020 totalled £28.6m. and a £16.1m. loss is forecast by the end of 2021, much of which has come as a direct result of Covid travel restrictions which resulted in tourists and islanders spending less time flying.
Deputy Roffey said he had reasonable confidence in the new policy, but that the two-year scheduled recovery period could not be definitive.
‘It’s a reasonable forecast if the pandemic was to resolve itself.
‘The strategy of doing more with less should work – if it didn’t work it would have an effect on the broader economy, tourism and locals.
‘From a broader island point of view that would be regrettable.’
He added that the effectiveness of the new policy was dependent on the pandemic.
‘A lot will depend on Covid, but we should be seeing results in a year.’
Plans have been made to streamline the fleet to be more cost effective by scrapping Dorniers, which operate the Alderney services, and prioritising the use of ATRs, which Deputy Roffey said should have been implemented before now.
‘We have about six different aircraft for a very small fleet. We have simply ludicrous aircraft types.
‘Maybe it should have happened earlier.’
