Guernsey’s Aurigny Air Expects £9.6 Million Loss In 2020

Aurigny could lose £9.6 million of public money in 2020. The loss is due in part to what is considered to be a disjointed approach to the subsidized carrier’s management.

Aurigny Air ATR on taxiway
Guernsey’s Aurigny Air Services is set to lose at least £9m of public money in 2020. Photo: Ken Fielding via Wikimedia

The Guernsey flag carrier, which provides services between the Channel Islands and mainland Britain, is already £7 million in the red in 2019. The promise of a further £2 million slide has seen the government of Guernsey step up to the plate, again.

According to Bailiwick Express, the state-owned carrier will receive £7 million next year in subsidies, even though only £4 million was budgeted for. All subsidies paid to Aurigny are passed on to the taxpayer.

Gavin St Pier, the President of Guernsey’s policies committee told the Bailiwick Express, “We are beginning to see the financial consequences of a disjointed approach to air links.

“The island has benefitted in some ways with more destinations to fly from, including a daily Heathrow service. But a lack of coordination has arguably resulted, at least in part, to significant losses for Aurigny, which the taxpayer has to cover.

We have written to Aurigny but have so far received no reply.

Causes

Aurigny has been running at a loss since it was bought by the government for £5 million in 2003. Despite its fruitlessness, it is regarded as an essential airline. It provides a vital link to the rest of the Channel Islands, mainland Britain and France.

Aurigny ATR on taxiway
Aurigny provides an essential link to the mainland of France and the UK. Photo: Ian Gratton via Wikimedia

In 2015, 15 years of debt (amounting to £19.9 million, writes the BBC) was paid off by the Guernsey state. At that point, the government promised to impose sweeping changes. Those included ways to manage the ups and downs of the carrier more effectively.

Re-branding and re-naming were also considered, in an effort to stamp the Bailiwick identity to the brand, and to make the brand easier to pronounce.

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They spend up to £500,000 each year on off-island marketing,” Guernsey Deputy Darren Duquemin told the BBC at the time. “How much of this investment is wasted because of the handicap of what Aurigny admits on its own website is ‘not the easiest of names’?”.

Following the clearing of the debt the airline was expected to turn a profit in 2018.

Clearly, there has been no such undertaking from the States’ government to find a sustainable strategy for the airline. Indeed, the latest announcement of the government’s putting in place a “sustainable air transport policy” looks set to fall on deaf ears.

Aurigny ATR landing
A “sustainable air transport policy” looks unlikely to bolster the enthusiasm of the taxpayer. Photo: Rob Hodgkins via Wikimedia

Solutions

Gavin St Pier’s explanation of a “disjointed approach to air links” is just one of the numerous causes associated with the mounting losses of Aurigny. St Pier says a lack of coordination and coherency within Guernsey’s system of government allowed, for instance, the £825,000 backing of Flybe’s Heathrow-Guernsey route earlier this year.

Aurigny current flies between the Channel Islands and London’s Gatwick and Stansted airports.

Conflicts of interest aside, Aurigny outgoings have been particularly steep this year. And the trend is expected to continue unabated unless someone can grab the reigns of the island’s air route operation.

According to some observers, the solutions to the crisis do not just come from quasi-re-branding and halfhearted coordination of operations. A further termination of unprofitable routes and daily scrutiny of the carrier’s use of state funds are also vital to the survival of Aurigny.

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Luke Mellor

More transparency would be a good start. Aurigny claims to be bleeding money on its Alderney – Southampton route but, despite public demands, refuses to provide a break down of the Opex for each route. The airline just uses the Guernsey taxpayer as a revenue sink – given the precarious state of finances for all of the Channel Islands this will not end well.

Charlotte Fox

Aurigny means “Alderney” – the island that the airline was set up to serve, back in 1968. For many many years Alderney’s airline was running an efficient, reliable and – I believe – profitable service linking Alderney, Guernsey and Jersey. Their problems only started when they decided to become something different – a low-cost regional carrier competing with the likes of Flybe. And in recent years they’ve made bad decision after bad decision after bad decision. The transition from Trislanders to Dorniers was handled abysmally. And what possessed them to start flights from Guernsey to Southampton, offering ridiculously low fares… Read more »

Charlotte Fox

Typo correction…

“And how can they offer SOU to ACI for 19.99 – less than a quarter of the cheapest fare between SOU and ACI?”

should, of course, read

“And how can they offer SOU to GCI for 19.99 – less than a quarter of the cheapest fare between SOU and ACI?”

Considering taxes and charges add up to more than £19.99 the airline is selling flights at less than cost – effectively paying passengers to fly with them.