Nico Bezuidenhout said the competition on London services has also left typical Aurigny fares 10% cheaper in real terms this year than last.
While he said he fully appreciated the wider benefits of the BA service, and the appeal of keener fares to travellers, increasing capacity by 25% on a relatively mature route such as London was always going to come at a considerable cost.
Mr Bezuidenhout pointed out that he has been consistent throughout in his estimate of the financial impact the Heathrow service would have on the States-owned airline.
He said Aurigny had no choice but to respond commercially to new, subsidised competition.
‘Because full aircraft are crucial to our business model, that required price stimulation, promotions and active marketing to fill those seats. So fare levels this year were, on average, more than 5% lower in cash terms than the year before. When you add in inflation, that is a reduction of over 10%.’
He said he was far more optimistic about next year, but only if the States would not start paying airlines to compete against Aurigny on other routes.
He said the airline planned to trim its losses in 2027 by reducing its ATR fleet while still operating 97% of its current flying schedule. That efficiency will come mainly from an agreement with Guernsey Ports to keep the airport open for longer.
‘That allows us to schedule both our aircraft and our flight crews more efficiently, and to do more flights per aircraft. So our intention is to shrink our fleet by one aircraft, but we will still be able to keep one of the five ATRs as a standby, because the other four will be able to fly more segments. That will remove somewhere in the order of £2m. in fixed costs a year. Both our aircraft and our people will become more efficient thanks to the longer opening hours.’
Despite this positive development, Mr Bezuidenhout was clear that any further subsidised competition on other routes would only compound the difficulty of maintaining frequent, year-round air connectivity while also acting as an insurance policy for the island.
‘It would be bound to create further losses, because Aurigny can’t get much smaller. It’s already a small-scale airline, and we need a fleet of at least three active aircraft just to maintain the lifeline routes. Plus we need an aircraft for when one of our fleet is undergoing maintenance, and one to cover the unforeseen events that typically happen day-in, day-out to any airline.’
He said his staff were already more productive than those at any other regional airline in terms of both passengers and flights per employee.
And with Aurigny also not having needed to spend anything on wet leasing since last April, he would find it very hard to strip further cost out of the business.
Despite the warnings of losses, which are also partly down to very high oil prices, Mr Bezuidenhout said he was bullish about many aspects of the business. Aurigny will carry a record number of passengers this year, and its punctuality is back to pre-2024 levels.
He said he was particularly pleased that the Guernsey-Jersey service was the fastest growing established route in either island, and said he would not rule out boosting capacity on the route by using a Twin Otter to supplement the twice-daily ATR rotations.
But he promised the people of Alderney that this would only be considered once their air links had been fully stabilised.