Low Cost & Regional

Doncaster Sheffield Airport to close due to financial viability fears

The owners of the UK’s Doncaster Sheffield Airport said the regional airport is to close after no tangible proposals were received ‘regarding the ownership of the airport or which address the fundamental lack of financial viability’.

Peel Group said that a strategic review of Doncaster Sheffield Airport had ended and that the high fixed costs associated with running a safe, regulated airport, together with recent events materially reducing prospective future aviation income streams, meant that a break-even business plan cannot be identified for the foreseeable future. 

As a result, DSA will begin winding down the provision of aviation services during the week commencing Monday, 31 October 2022. DSA said it would continue to work closely with airport customers and other users to explain the impact of this service reduction and work with them to minimise the disruption to their operations and customers. 

Since the July 2022 announcement of the Strategic Review, Peel has been actively engaging on a weekly basis with local and national political stakeholders, including proactively engaging with working group meetings, primarily led by officers at Doncaster Council, South Yorkshire Mayoral Combined Authority (SYMCA) and the Department for Transport (DfT). Throughout the consultation process, Peel said it had also been in close contact with the airlines and other aviation users of the airport. “None of these discussions has delivered any tangible results that have changed the Board of DSA or Peel’s clear view that the Airport is and will remain unviable,” it said.

Peel said it had received a letter from the Mayor of South Yorkshire and Mayor of Doncaster on Thursday, 8 September, stating that they had completed an economic impact study of DSA which identified its economic benefit to the region but provided no solution to its lack of financial viability. Furthermore, they informed Peel that they had been approached by a group interested in purchasing or operating the airport. Peel has yet to receive a response to urgent requests for details on the consortium’s identity, nor have the terms of any proposal or evidence of the consortium’s financial standing or aviation expertise been provided. 

On Friday, 23 September, Peel received a further letter from SYMCA and Doncaster Council, which was supported by the Mayor of South Yorkshire and the Mayor of Doncaster, along with the Leaders of Barnsley and Rotherham, which included a proposal to provide public money to DSA to fund its operating losses until 31 October 2023. The grant was described as providing DSA with free cashflow to sustain losses that may occur over thirteen months while the Peel Group and South Yorkshire partners jointly explore the future potential of DSA and the GatewayEast site. In the absence of any actual proposals to address the lack of viability of DSA, even those at an early stage of development, or any identified potential acquirers or operators of DSA, Peel’s Board has concluded that it cannot responsibly accept public money for this highly uncertain process against the backdrop of an unviable, loss-making operating business. 

Steven Underwood, chief executive, Peel Group said the business would continue working closely with local and national stakeholders to develop a forward-thinking strategy for the airport site, in conjunction with the £1.7 billion GatewayEast development next door, to help unlock vibrant, job-creating alternatives to ensure future growth and prosperity.

The airport’s sole based operator TUI is expected to operate its final flights on 4 November 2022.

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