Government must not take a short-haul approach to the future of Irish Aviation – BREEN.

December 12th, 2008 - Pat Breen

Fine Gael’s Deputy Spokesperson on Foreign Affairs and Clare T.D. has today warned the Government that they must not take a short-haul approach to the future of Irish Aviation. He said before any decision is made by the Government to sell their Aer Lingus shares for thirty pieces of silver that the Ryanair bid to take-over Aer Lingus must be fully evaluated. Deputy Breen also believes that “Following the acceptance of the cost savings plan by both SIPTU and IMPACT in recent days, it is now very important to hear Aer Lingus outline their own company’s strategic plans and in this context Deputy Breen has written to the CEO Dermot Mannion asking him in light of the Ryanair proposals to evaluate his company’s decision to exit the Shannon Heathrow Route and encouraging him to return and serve the ready made market here in the Mid-West..” Finally, Deputy Breen said that the Minister for Transport and Marine Noel Dempsey and the Minister for Finance Brian Lenihan’s recent comments in relation to the reasons why the Government retained a shareholding in the Airline to protect connectivity to the UK ring very hollow here in County Clare in light of the Governments failure to intervene to secure those same slots at Shannon Airport less than a year ago.”

“Before any decision is made by the Government to sell their Aer Lingus shares for thirty pieces of silver this latest Ryanair bid must be fully evaluated. If this bid is accepted it is estimated that the Government coffers will be increased by a mere €188m in cash. Is this value for money for the Irish taxpayer? The Government should not be tempted to opt for a soft landing by selling these shares now to help balance their budget in the short-term instead they must evaluate this decision for long-term strategic reasons.” “Over recent days the Unions and Management of Aer Lingus have signed up to a major restructuring package and they expect to save €50 million overall on staff costs as a result of this agreement while at the same time they maintain a strong balance sheet with net cash of €766.70. I would now like to hear Dermot Mannion clearly outline Aer Lingus plans for the future and particularly his plans for his operations at Shannon Airport.”

“The Ryanair Sweetener for the Mid-West Region is that they are promising to reinstate the Heathrow Service with a twice daily service from Shannon and to give control of those slots over to the Government to retain in the Region for the future. The reinstatement of the Shannon Heathrow link is vital in assisting this Region to address our declining competitiveness. I believe Aer Lingus now have a golden opportunity to restore public confidence and goodwill in the Airline here in the Mid-West and I have written today to the CEO Dermot Mannion asking him to reinstate the Shannon Heathrow route.”

“It is imperative in my view that as an Island nation we retain a competitive airline industry and to date our two airlines strategy has served this country well. Over recent days we have heard a lot from Ryanair on the potential growth and development on short-haul routes but I would like to hear more in terms of their plans for the development of long-haul and transatlantic services.”

“I have long held the view that it is unwise from this Region’s perspective that Shannon Airport should be over dependant on just one airline. My fear is that we will have no competition in the market and the consumer will at the end of the day be made to foot the bill by having to pay higher prices. It is imperative that the Airport retains a balance in terms of traffic development growing its short-haul routes while retaining daily direct transatlantic connectivity, in other words Shannon Airport should not place all its eggs in one basket. It could become virtually impossible for Airports in Ireland including Shannon to attract other airlines into the country and we have already witnessed where several Airlines have already exited the Irish market because of Ryanair’s dominance in the market place. If this bid succeeds they will effectively operate 80% of the airline business in and out of this County.”

“Finally, I find the Minister for Transports and Marine Noel Dempsey’s and the Finance Minister Brian Lenihan’s comments in recent days to be a bit tongue in check in terms of the reasons why the Government retained a shareholding in Aer Lingus. These words ring very hollow here in County Clare when the Government failed to act last year to secure that UK Heathrow connectivity to and from Shannon.”

 

“What is clear however is that the Government must not take the short-haul approach to the Irish Aviation Sector, this is a proposal which must be evaluated for the long-haul” in deed in the words of our Finance Minister Brian Lenihan “the Government will have to be very careful how they dispose of this very valuable national asset.”

ENDS.