Manchester Airport boss expects ‘no growth’ in 2008
08.04.08
Manchester Airports Group chief executive Geoff Muirhead has said that slower growth in the airline industry and increased taxes on passengers is set to take its toll on the business over the next 12 months.
Speaking at a regional economic discussion organised by the CBI last week, he said he was ‘not anticipating any growth at all’ this year at Manchester Airport, but MAG's smaller regional airports including Humberside, Bournemouth and East Midlands should fare slightly better due to the fact that they served more of the low cost airlines.
He said: ‘Last year was the first year I can remember in the aviation industry where growth has been down to 3 percent, except when there has been a major economic shock,’ adding that average growth rates for aviation over the past 30 years have been closer to 7 percent.
Mr Muirhead said the Government's doubling of Air Passenger Duty rates last year as a factor in slowing growth. He said: ‘It is a £2.5bn tax on the aviation industry and I think it's getting to a tipping point where it's really quite challenging in respect of the UK's competitiveness. We cannot compete as a trading nation if we don't facilitate people getting around to actually do the trading. Nothing is without its cost, as we saw a few years ago when pension funds were targeted.’
He also argued that demand would be weakened by increasing pressures on consumer spending, saying: ‘The things you have no choice about — food, energy, transport — those are going up at horrendous rates.’
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