Bussiness Plan

Can Cardiff Airport Survive?
Mike Snelgrove
Senior Lecturer
Cardiff School of Management
Jan 2011

Cardiff Airport (CA) is owned by Airport Concessions and Development Limited (90% Abertis Infraestructuras, 10% Aena Internacional), who also own Belfast International airport and have operational, management and development responsibility of Luton airport. CA has a core population catchment of 2,279,000 from mid and south Wales: M. Glamorgan, S. Glamorgan, W. Glamorgan, and Dyfed Gwent Powys; and an outer population catchment of 2,266,800 from South West England; Avon, Gloucestershire, North Somerset, Hereford and Worcester, all of which are within 90 minutes drive of the airport. However, CAA surface leakage data shows that it is losing as much as 70% of the traffic from the core catchment to airports in England – 12% of which goes to Bristol Airport. This leakage is a significant drain of Cardiff’s market as they do not have a sufficiently differentiated or strong enough product to attract market share from outside Wales, with the exception of a small number of passengers attracted by CAs strong charter offering.
Cardiff Airport’s strategy for growth has seen a number of setbacks over the past couple of years. Since 2008 passenger numbers have fallen from 2.1 million to 1.4 million, partly due to environmental factors such as the Iceland dust cloud and the recession, but largely due to the retraction of services from BMIBaby adding to the narrow, ‘messy’ and fluctuating route mix on offer. This, added to the leakage described above characterises an airport that is struggling to compete in a complex and highly competitive marketplace.
In April 2011, BMIBaby announced that it would be pulling all of its services from Cardiff in the following October. If no other carriers can be found to take on the gaps in the route mix then this could see passenger numbers drop even further – perhaps as low as 800,000. Will this mean the death of Cardiff Airport?

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