Passenger numbers at UK airports could decline by more than 40% over the next 12 months without government intervention, while 12% of routes in and out of the country could be discontinued, according to a new report commissioned from York Aviation by Airlines UK.
The report argues that if the UK’s air passenger duty (APD) were to be waived for a year, it would result in an additional 21 million passengers flying through UK airports over the coming 12 months, and could boost the number of routes operated to and from the country by 5-6% each month.
“The temporary removal of APD would potentially stimulate demand for travel and/or enable airlines to temporarily support the commercial viability of routes that might otherwise have to be withdrawn,” says the report.
York Aviation estimates that, without intervention, the UK’s air connectivity will be reduced by up to 50% for the remainder of the summer season, versus the same period in 2019. By July 2021, it predicts, the number of regular destinations served will fall 12% – and the UK’s regional airports will bear the brunt.
Based on its demand estimates, the report expects that a temporary APD waiver would cost the UK government £2.1 billion ($2.6 billion).
“UK airports are in danger of losing many valuable routes over the coming months unless the government steps in with a support package for our sector – starting with an emergency APD waiver to get us through the winter and into the recovery,” states Airlines UK chief executive Tim Alderslade. “Some of these routes may never come back but APD relief will – by next July – save almost half that wold otherwise be lost.”
Airlines UK is calling on the UK government to announce a 12-month APD waiver “no later than the autumn budget”.
Earlier this year, UK chancellor Rishi Sunak indicated that consultation on a review into APD levels would take place in spring 2020. However, this pledge was made before the country went into lockdown to curb the spread of Covid-19.
The government is considering changing the APD treatment for domestic flights, for instance reintroducing a return leg exemption, and increasing the number of international distance bands.
