London’s Gatwick airport has warned that the UK’s economic slowdown threatens the aviation industry’s recovery from the pandemic even as it forecast rising passenger numbers after a summer of disruption.
The UK’s second busiest airport on Tuesday said it expected 32.8 million passengers in 2022, up from the 30.6 million it forecast in March.
But it added that this could be affected by “macroeconomic uncertainty – including inflationary pressures on costs and passenger demand for the winter season”. And later on the same day there was a flare-up of disruption, with EasyJet forced to cancel 26 flights to Gatwick because of staff absences at the airport’s control tower.
Jim Butler, Gatwick’s chief financial officer, said the company is “under no illusions about the headwinds coming”, notably the potential for rising inflation and a weakening economy to hit demand. “Airlines haven’t showed us that is happening yet, but we are still in the peak season and we are being cautious about what we might see in the winter or next year,” he said.
The caution follows a bumper summer that the industry struggled to cope with.
Unlike Heathrow, Gatwick on Tuesday said it would not extend a cap on flight numbers that was introduced in the summer to try to reduce disruption. Gatwick cut its maximum number of daily flights to 825 in July and 850 in August, down from the 900 that airlines planned to operate at peak times, after a wave of last-minute cancellations and delays because of staff shortages.
The airport hired an extra 400 security staff in response, and diverted its own staff to the stretched ground handling companies that provide services from check-in to baggage handling.
“We are now very much operating business as usual and do not see any reason to extend the capacity declaration,” said Gatwick’s chief executive Stewart Wingate.
He said the seasonal reduction in travel going into the autumn meant that the airport would easily have the resources to deal with demand.
Short-notice cancellation rates fell from 1.8 per cent of flights in late May to just 0.1 per cent in early August.
Heathrow, the UK’s busiest airport, has extended a passenger number cap until the end of October because of continued staff shortages among ground handlers. British Airways has cancelled hundreds of flights as a result.
Gatwick reopened its south terminal in March after mothballing it for nearly two years during the pandemic, a difficult period that resulted in heavy losses as some big airlines consolidated operations at Heathrow.
Passenger numbers at Gatwick reached 81 per cent of 2019 levels in July, up from 27 per cent in January.
“We still have some way to go, but strong demand has fast-tracked Gatwick’s recovery from the pandemic,” Mr Wingate said.
The airport returned to profit for the first time since the start of the pandemic in the first six months of the year, reporting profit after tax of £50.6 million (€60.1m), compared with a £244.6 million loss over the same period in 2021. Revenue rose nearly sixfold to £291.5 million. – Copyright The Financial Times Limited 2022
