Airlines and airports across Europe gathered in Spain’s Basque Country to plan and negotiate future air services within the region at the 13th annual Routes Europe.

The European Union (EU) market maintained a dynamic growth trajectory with passenger traffic increasing by 6.2 per cent during the first quarter of this year according to figures from Airports Council Europe (ACI).

Some 14 EU national markets recorded double-digit growth – mostly in the Eastern and Southern parts of the bloc, along with Finland and Luxembourg.

Some large regional airports posted an impressive rise in passenger traffic, driven by particularly successful network development strategies, these include airports at Seville, Krakow and Naples. And its with strategy in mind that airlines and airports across Europe courted in typical Basque style at the 2018 instalment of Routes Europe.

The host, Bilbao Airport, welcomed more than 4.9 million passengers in 2017, a figure that is expected to rise again in 2018. In fact, low cost operator Volotea is developing four new routes to Vienna, Malta, Palermo and Malaga having inaugurated its new base in Bilbao during the course of the event.

Industry experts explored the major challenges and opportunities for Europe’s aviation sector in a series of conference sessions, including how Brexit will impact the aviation industry as Britain seeks to negotiate its exit from the EU, how terrorism is affecting tourism growth and the rising dominance of low cost carriers in the European market.

Billund wins big

Of course, the airports were out in full force vying for a slice of that growing airline capacity. Billund Airport was one of the star attractions at the event having scooped the Routes Europe 2018 Marketing Award.

The Danish gateway beat off competing airports from Belgium, Ireland, the Netherlands and Northern Ireland to take the title in the under 4 million annual passenger category. Last year Billund delivered its best ever results with 3.4 million passengers travelling through the gateway in 2017.

“Last year was a really interesting year for us,” Jesper Klausholm, Billund Airport’s head of airline relations and marketing tells Low Cost & Regional Airline Business in Bilbao.

The airport attracted new routes such as Berlin and Warsaw but more interestingly there has been significant growth in average load factors in Billund, simply because the economy of Denmark in booming and the demand for airline seats is high.

“We have seen a few new routes coming into Billund over the last few years and we are now seeing frequency and capacity on those routes maturing so the airlines are now building frequency on existing routes. That was the case last year and we actually had eight years of consecutive growth,” Klausholm explains.

Billund has a very balanced mix of airlines 25 per cent of traffic is charter 25 per cent is low cost and about 50 per cent is network and regional traffic, Klausholm notes.

Over the last years the airport has seen steady growth in the low cost segment but particularly from the network carriers: “We have seen British Airways coming in from Heathrow and Finnair coming in from Helsinki and significant growth on Amsterdam and Frankfurt from KLM and Lufthansa, and Brussels Airlines has also grown the Brussels route significantly.”

Despite the growing links with the network airlines, low cost remains a vital segment for Billund Airport. “They, [LCCs] are equally important. Network carriers can provide us with global reach, for instance from Billund you can reach 540 destinations with one stop at one of these hubs but then the LCCs can also do something else.

“They especially bring in inbound passengers to western Denmark, so for tourism low cost is very important. When an airline like Wizz Air or Ryanair start a new route, they bring in a lot on inbound tourism so that’s really good for us.”

Over the coming months, Billund will launch an additional six new routes and welcome three new airlines into its portfolio during summer 2018.

The expanded summer schedule kicks off with two new links to Athens operated by both Ryanair and Primera Air from May. As the peak summer season approaches, Billund will welcome the arrival of Nordic carrier, Widerøe with a three times weekly service to Bergen in June.

Wings of Lebanon will also commence flights to Western Denmark in June, linking Billund to its Beirut base. Throughout the peak summer months, the airline will service the route with weekly flights.

The beginning of July will bring another new carrier as LOT Polish Airlines adds operations from its Warsaw Chopin base with a 12 times weekly service. Later in July Wizz Air will launch its seventh route from Billund, with a direct connection to Iasi in Romania.

“It’s a very balanced growth of regional airlines and low cost and one interesting thing about the LCCs is that when they base an aircraft in a new airport suddenly you get new possibilities so that is quite encouraging,” says Klausholm.

Billund Airport is in discussion with carriers in terms of longer sector services and is looking at the demand from the region for transatlantic flights particularly with the arrival of the MAXs and the neos. These aircraft are attracting smaller regional airports like Billund that have quite large indirect flows of traffic to places like Asia and America.

In terms of infrastructure, last year Billund had a large investment in security and is now investing in the baggage handling system, a VIP lounge and the information systems. The airport is also undergoing a €20 million terminal expansion which will increase the capacity of arrivals and other activities.

UK connection

Improving global connectivity via major European hub airports was the goal for the team representing the UK’s East Midlands Airport (EMA) at the annual Routes Europe forum in Bilbao.

Andrew Pelham, EMA’s head of aviation development, says EMA’s focus is to secure a new network carrier allowing passengers to fly with one airline from EMA to the other side of the word via a major European hub airport, on one ticket.

When speaking to this publication about the strategy for connectivity, Pelham reports that it‘s moving in a positive direction. “We are getting a lot of traction now with airlines and are considering connectivity with the likes of Amsterdam, Paris, Frankfurt and Dublin,” he states.

EMA is particularly interested in the evolution of the low cost model.

“We see the legacy airlines now offering basic fare only tickets. We are also closely monitoring how far Ryanair evolves and if they will start offering connectivity onto other services that we can tap into. This could be a perfect opportunity to offer connectivity to Europe and beyond,” Pelham indicates.

Like other thriving regional airports, EMA is also monitoring with interest the new generation aircraft that are opening new markets and opportunities for long haul. The East Midlands in the UK has strong cultural links with many parts of the world including the Middle East, Indian subcontinent and across Europe.

“We are monitoring and progressing those discussions quite rapidly. The single-aisle narrow bodies are the right shape for the market – the UAE and Middle East could be a viable option or India could be served directly with a low cost high value product,” Pelham anticipates.

Another British airport doing the rounds in Bilbao was Cornwall Airport Newquay (CAN). In 2017, the airport handled 461,300 passengers, a 24.2 per cent increase compared with 2016. “We have had four years of double digit growth and passenger numbers have doubled since 2015,” states Al Titterington, managing director at Cornwall Airport Newquay.

In 2016 CAN took a strategic gamble by abolishing a £5 airport development fee after recognising that it was stunting growth, so the airport put together a business case where it would sacrifice just short of half a million pounds worth of income but be able to get back that revenue by stimulating the market with airline growth instead.

The gamble paid off, as Titterington illustrates: “As a result, we have been able to grow frequency as well as aircraft size with the various airline operators such as Flybe, Aer Lingus and Ryanair.”

Cornwall Airport is geared for a busy summer season. The airport witnessed the inaugural flights of Eurowings’ weekly services to Berlin Tegel and Stuttgart, doubling CAN’s German connections. Eurowings’ new operations to Germany give the airport a 20 per cent increase in seats to Western Europe throughout summer 2018.

“For this summer, Eurowings have introduced two new services to Berlin and to Stuttgart so the route portfolio is grown as well as passenger numbers coming through the airport.”

Titterington points to London-Gatwick, especially, as an important link. “Gatwick is busy, 35 per cent of traffic is going point-to-point and the rest is leisure traffic which is going beyond Gatwick, which could be self-connecting onto an easyJet or Norwegian flight or one of Flybe’s codeshare partners. Manchester is very much leisure inbound coming into us.”

In terms of demographics CAN is more of a leisure airport, which is evidenced by the schedule, as Titterington observes: “We are incredibly busy in the summer and not quite so busy in the winter, for instance on a Saturday in November we might just have 500 passengers in and out but on a Saturday in summer we might have over 3,000 passengers,” he says.

Looking ahead Titterington would like the capacity a little more spread out considering that Flybe represents 73 per cent of the airports business.

“We would like to spread some of that risk. I would like to develop the Aer Lingus services and the Ryanair services so that we can start to mitigate the risk, but Flybe will always be our dominate operator.”

After some 4,800 meetings at this year’s Routes Europe, the 1,200 delegates were able to finally enjoy some of the Basque hospitality and traditions.