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Post by kirmingtonuser on Aug 3, 2012 10:37:20 GMT
Some years ago, AirUK had a leisure division serving the I.T. market. It used a fleet of modern Boeing 737-400 aircraft exclusively on charters. The only raison d'etre appeared to be the use of AirUK's quality image and branding in a wider market. As the aircraft were never used on scheduled services, the division was non-core and was subsequently sold off. Palmair have demonstrated at Bournemouth that it is possible to run a successful single-aircraft fleet in the leisure market for many years. They did not have the advantage of owning the aircraft or the airport. If Eastern Group cannot attract a low-cost or I.T. carrier to HUY, they are now in a position to benefit from the airport ownership by setting up their own leisure division. Provided that the operation broke even, the returns would show up in the group's Airports Division. A single aircraft might add 200,000 passengers to HUY's annual total. If they all generate revenue of £11 per head, there would be a useful increase in turnover with a dis-proportianately smaller rise in running costs.
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Post by huytiger on Aug 4, 2012 11:43:03 GMT
I have thought for some time - since the mainstream charter operators lack of interest - that the solution may be a based aircraft owned and operated by the airport. Now that the airport is owned by an airline, the above suggestion is not far fetched. They would not have to make money on the actual flights as ancillaries such as car parking fees would produce the turnaround in revenues for the airport. Capacity could be sold to the mainstream operators, and the remainder through Humberside Airport Travel, who are already well established. As kirmingtonuser says this could all be done with minimal increase in terminal operating costs.
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Post by kirmingtonuser on Aug 5, 2012 20:29:57 GMT
The points about Humberside Airport Travel and the selling-on of some of the capacity are well made. On the other thread, pug has also pointed out that there is very little point in trying to cut costs by cutting terminal capacity. Even if a leisure division is not developed, I think it would be in Eastern's interests to investigate the costs, risks and rewards that would flow from setting one up. This would give them a good handle on the pricing terms which they should offer to other leisure operators at HUY. If they do go ahead, they should beware of over-expansion. Cimber Air (which used to fly to HUY from Sonderborg and Esbjerg) was a long-established, successful Danish regional airline which took over the leisure airline, Sterling. The result was the bankruptcy of Cimber Sterling in May 2012. Another risk is damage to the brand of the main airline. Eastern's brand image is very up-market (higher than AirUK's was). AirUK probably suffered some brand damage from the lower levels of seat pitch etc. on AirUK Leisure aircraft. The solution to this is to introduce a completely separate brand. They could probably use the Air Southwest name for this purpose. It even has the advantage of being known outside Devon as they were operating the Humberside / Jersey charter flights as recently as 2005 !
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Post by pug on Aug 6, 2012 12:19:00 GMT
I wouldn't be completely surprised to see this happen to be honest.
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Post by kirmingtonuser on Aug 24, 2012 10:33:39 GMT
There are a couple of business examples which are worth comparing with the current situation.
1. Eastern Airways was set up originally with one wet- leased Icelandic Fairchild Metro. The reason was that KLMuk had withdrawn from all non-Amsterdam routes and the oil industry was left without its link between Humberside and Aberdeen.
2. The operators of the east coast main line gradually reduced the direct rail service between Hull and London until there was only one train per day each way. There wasn't a single direct morning departure from King's Cross to Hull. The result was the formation of Hull Trains. There are now eight direct services per day in each direction.
These examples show that if there is a well-proved demand which is not being met by remote suppliers, local enterprises are more than capable of thriving on the resultant opportunity.
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Post by tugman on Aug 26, 2012 10:11:01 GMT
With regards to Hull trains,are they not heavily subsidised or owned by First Group? Any "start up" routes out of HUY by a "new" leisure arm of Easterns could easily be gazumped by rivals flying in/out of DSA and LBA if a similar shared ownership is not in place surely? Aviation has always proved to be more devious,underhanded and cut-throat.I hope that growth in leisure comes from a variety of airlines/brokers so the competition is increased and the dangers of relying on one operator and hoping they do not decrease their flights in hard times (i.e. TCX, FlyBe etc) are reduced.
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Post by pug on Aug 26, 2012 11:40:34 GMT
I seem to remember they were started by a local group and then taken over by First some years later. Hull Trains now carry 750,000 passengers a year, 49% of which are O&D in Hull.
Not sure Thomson at DSA would prove such a threat, and whenever an airline has dipped its toes at HUY then it has been proven that the local catchment area will support the flights irrespective of DSA. There is nothing to suggest that a local airline, perhaps setup as a semi-autonimous operation, could not see similar success as have Hull Trains.
However, if you have no real commitment from any of those they will continue to chop and change. If you have a based operator you at least have a guarantee of a number of routes to sustain the operation.
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Post by kirmingtonuser on Aug 26, 2012 15:20:07 GMT
That is right, Hull Trains were formed in 2000 by Renaissance Trains (20%) and GB Railways (80%). First Group acquired GB Railways and re-branded the operation as First Hull Trains in 2008. The company is an open-access operator which means that it pays access charges to allow it to operate on the track, but does not have to meet the terms of a full-size franchise operation. The Rail Regulator limits the number of slots to ensure that Hull Trains does not take too much business from East Coast. Hull Trains was the first open-access operator to be formed and they have been followed by Great Central.
The whole point about this discussion is that the damage to HUY's leisure business has already been done (partly to the benefit of DSA and LBA), but the new airport ownership allows an opportunity to recover. What has been suggested here is a modest single based aircraft generating perhaps 200,000 passengers per annum. This number is considerably less than the totals which have been achieved in the past (even since the opening of DSA). There is a core customer base within a 45 minute drive and they prefer to use Kirmington as a departure point. There are people who suggest that the leisure business at HUY would support two based aircraft and that any surplus capacity could be marketed at ABZ and MME where charter services have also been withdrawn.
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Post by pug on Aug 26, 2012 19:21:12 GMT
I think if they were to show any interest in such a thing at all then it would have to be an operation of some scale, i.e more than just one aircraft. I would also think that they wouldn't want to operate it under the Eastern brand due to the differences in operations.
2xaircraft at HUY and ABZ which charter operators have largely neglected, possibly also MME and NWI. No direct competition, and it seems unlikely that there ever will be.
The thing is that such a venture would require significant startup costs, and are Eastern really in a position to fund such a thing?
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Post by kirmingtonuser on Oct 1, 2012 15:22:50 GMT
See the posting on Special Departures 2012 under Charter Flights. It looks as though a Leisure Division has been started in a small way, using the Eastern Airways brand and HAT. The sales figures look very encouraging so far !
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Post by mrmoose on Oct 1, 2012 17:13:02 GMT
Interesting - could this pave the way for lots of 'one-off' special departures using one of their RJs on saturdays/sundays when their main network is quieter? Day out to Paris? One off Ski charters? Weekend 2 night breaks in Dublin? Im sure there are all sorts of options that could be looked into, and selling 50 seats should not be a problem - coach operators sell these sorts of breaks in those numbers week in week out.
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Post by tugman on Oct 1, 2012 19:58:02 GMT
Niche market that fits in very well.Right size aircraft sitting there.Small to fill but big enough for comfortable and profitable short hops IF one off ski flights did happen AND they were successful, which we are all aware that they probably would be, then it could encourage a regular route re-appearing from a more established leisure carrier.Ifs and buts. I certainly could see EA expanding operations more in this way than "bigger" holiday charters in the summer and having to invest in A320's or 737's.
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Post by pug on Oct 1, 2012 22:26:16 GMT
It is an interesting concept for them, and HUY being their main base it allows for frames to be used that would otherwise be parked up.
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Post by blake on Oct 2, 2012 10:56:58 GMT
A ski charter does sound very interesting, i am lucky enough to go skiing every year and we always tend to go from either Manchester or Birmingham as i believe only crystal charter from DSA and LBA (somebody correct me if i am wrong please). Even if there is just a single return flight on a Sunday when most transfers are done surely it would pay? www.j2ski.co.uk/ski_resorts/Airports/ using the link there must be at least 30 airports in Europe with hundreds of winter resorts. Would HAT be able to come up with some holidays by Winter 2013/14?
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Post by kirmingtonuser on Oct 2, 2012 15:00:47 GMT
They have done well to set up these first two trips within 2 months of taking over. Selling 72% of the capacity within 10 days bodes well for further offers of day trips and short breaks. The last tour operator to offer skiing charters from Humberside was Inghams between December 2008 and March 2009. An Austrian Airlines Fokker 70 provided the service to Innsbruck. Average monthly loads varied between 42 and 54 passengers, so were disappointing on a 79 seater aircraft. The use of an Eastern Airways ERJ with 37 or 50 seats would alleviate this problem. They could also differentiate the offer from mass-market ski charters by providing the full Eastern Airways service. Pleasing to see that they are starting this off on the right foot by serving champagne on the return legs from Cologne/Bonn !
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