Scotland’s airports are preparing for a new age of aviation in the biggest change to the industry since the advent of affordable air travel.
Like the growth of economical flight started in the 1970s by the availability of larger aircraft, the new flying revolution will emerge over a period of time and bring long-term benefits including a national aviation strategy that fosters expansion and connectivity across areas including tourism and hospitality, and crucially, ushers in the new clean jet fuel era in Scotland.
It comes as the industry awaits the Scottish Government’s aviation strategy, which is expected to “set out a clear framework for strengthening vital connectivity and ensuring Scotland is at the forefront of developing the technologies that will get us to net zero”.
As well as a clean industry driver, the post-pandemic aviation industry on the ground is expected to continue to be a major employer and key part of the economy.
Andy Cliffe, chief executive of AGS Airports, which operates Glasgow and Aberdeen airports in Scotland and Southampton in England, said this country has a unique relationship with aviation.
“It is well established that a region with strong connectivity will enjoy increased levels of trade and tourism,” Mr Cliffe said. “Airports are huge drivers of economic and social prosperity. The routes we provide support businesses in getting their goods to market, they help attract foreign direct investment, they create jobs and they underpin a successful tourism industry.
“Glasgow Airport alone generates £1.44 billion in GVA (Gross Value Added) every year and supports in excess of 30,000 jobs. We know that with the right policy support, we can attract more routes which will in turn enhance our contribution by adding a further £1 billion (GVA) and an additional 15,000 jobs.
“Importantly, we also know that we can deliver this growth sustainably whilst making continued progress against our net zero targets. By the end of 2023, passenger numbers in the UK were 21% higher than they were in 2005, yet carbon emissions had fallen by 9%.”
Mr Cliffe, who joined AGS as chief executive in January 2023, said there are big gains to be had in net zero.
“We know there is more work to be done and through the Jet Zero Council, the UK Government is working with the sector to support the considerable progress already made in taking carbon out of flying,” Mr Cliffe went on. “It recognises that a thriving aviation sector is key to the UK’s sustainable economic future. The council brings industry, government and academia together to accelerate the development of hydrogen-powered flight and sustainable aviation fuels, and it’s absolutely vital this partnership approach continues.
“Scotland, given our geography, has a unique reliance on aviation and there is a huge opportunity for us to take a lead on decarbonising aviation while at the same time attracting direct routes that will enhance Scotland’s global standing.”
This comes as we await publication of the Scottish Government’s aviation strategy, he added.
“We expect this to set out a clear framework for strengthening vital connectivity and ensuring Scotland is at the forefront of developing the technologies that will get us to net zero.
“It is important to have a joined-up ‘team Scotland’ approach to route development support and destination marketing to be able to showcase the county on the world stage. Within this, there needs to be a regional focus that amplifies the sectoral strengths and differing offerings each of our cities provide. Doing so will help us develop compelling propositions for airlines and visitors alike.”
Asked how government can work to help achieve clean fuel goals, Mr Cliffe said: “Sustainable aviation fuel (SAF) produces upwards of 70% less carbon emissions compared to traditional fossil jet fuel and will be the single biggest contributor to the decarbonisation of aviation. It can be made from waste materials such as household waste, agricultural residues and used cooking oils as well as green hydrogen. The use of SAF doesn’t require new technology for aircraft or the need for airports to invest in new facilities. Over 500,000 flights around the world have already flown on SAF, so it is a proven solution. The challenge is the lack of supply and cost.
“It is a critical component of the industry’s net-zero carbon road map which shows that 10,000 new jobs could be created in a UK SAF industry by 2030, rising to 60,000 jobs and £10bn of GVA by 2050. We need to ensure we realise this opportunity and that Scotland benefits from these jobs. If we don’t, we will be reliant on an import-led strategy which will see jobs and investment in SAF production flow into Europe and the US, both of which are already stealing a march due to incentive schemes.
“In April, the UK Government announced details of its SAF mandate, which comes into effect next year, and will require 10% of all jet fuel to come from sustainable sources by 2030. This was a welcome step, however, it is important government delivers a price certainty mechanism alongside the mandate. Not only would this address the cost challenge, it would really accelerate domestic SAF production. In Scotland, we have an opportunity to produce SAF at Grangemouth and at St Fergus in Aberdeenshire and the soon-to-be-published aviation strategy will be an opportunity for the Scottish Government to set out a supportive policy framework.
“SAF has been in use at Aberdeen Airport since October 2022 when Bristow became the first North Sea operator to voluntarily commit to an ongoing supply for its offshore operations in partnership with both the airport and Air bp.”
He said: “Alongside SAF, the development of hydrogen-powered aircraft has the potential to completely revolutionise aviation and it is becoming an increasingly viable option for regional and short-haul aircraft. At Glasgow Airport, with funding from the Scottish Government’s Hydrogen Innovation Scheme, we are leading a consortium to test the feasibility of a hydrogen production, storage and distribution hub that would support zero-emission flight.
“Our airports will be the perfect test bed for hydrogen flight and this project aims to create a blueprint for other airports to support zero-emission flight.”
AGS airports in Aberdeen and Glasgow welcomed 9.7 million passengers through their doors in 2023 and expect that number to increase to 10.7 million this year. Looking ahead to 2030, Mr Cliffe said: “We anticipate our airports serving over 15 million passengers by 2030.”
Glasgow Airport itself supports more than 15 airlines flying to over 100 destinations worldwide.
On how government help can facilitate future growth, Mr Cliffe said: “Scotland may be a small country in population terms, but it has a global allure attracting millions of visitors each year. This was evident in figures recently released by VisitScotland showing that nearly four-million people from overseas visited Scotland last year, 15% more than in 2019, with an overall visitor spend of £3.5 billion.
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“These figures underline the importance of a successful inbound tourism industry. The quality and breadth of our tourism and hospitality sectors are key components of our proposition to airlines and inbound visitors. It’s important this sector is supported which is why the decision not to afford business rates relief at the last Scottish budget was not only concerning, it was a missed opportunity.”
Mr Cliffe said: “The Emirates’ Glasgow Dubai service celebrated 20 years in April and is both a Scottish success story and a prime example of the importance of securing key strategic routes. When the service started in 2004 it was the first Scottish route to the Middle East. Fast forward two decades and the route has become one of the country’s busiest and has carried nearly 5.7 million passengers between Scotland and the world’s busiest international hub. The route also plays a key role in transporting a significant proportion of the £1.8 billion worth of imports and exports that move through Glasgow Airport annually.
“Looking ahead, it is crucial we continue to work with our partners at a national level to understand what markets ‘Scotland plc’ should be linked with and that’s the same at a regional level for our airports in Aberdeen and Glasgow. Identifying potential business links, trade flows and trends is key to delivering a co-ordinated route development programme within a wider aviation strategy which will ultimately aid discussions with airlines.
“There is huge potential for growth at Glasgow and we are focused on expanding our route network and growing direct connectivity. Having added one million passengers in 2023, Glasgow is on a clear trajectory of regrowth and we anticipate adding a similar number again in 2024.”
Mr Cliffe, said: “In the last 12 months we have introduced 20 new services at Glasgow and significantly enhanced our European destination and leisure markets. Airline partners easyJet, Jet2.com and Tui each added based aircraft to their growing fleets at Glasgow as a direct result of increasing demand, which is a fantastic endorsement of the strength of our outbound leisure market. It’s also a welcome boost for local employment as a based aircraft usually brings with it anywhere between 40 and 50 jobs.
“Returning regular direct US services to Glasgow remains a priority. Glasgow is Scotland’s economic powerhouse and the value of exports alone from the Glasgow City Region to the US stands at £5.1bn. A direct Glasgow New York route would be expected to annually support growth in economic value of £60m and an increase in tourism spend of £5m whilst also bringing far-reaching benefits in terms of job creation.”
On rumours emerging in the wake of the announcement of the sale of Edinburgh Airport, is there any potential for sale of the airport?
“AGS is a successful business and so it is no surprise there is speculation of this nature which comes with the territory,” said Mr Cliffe.
In April Edinburgh Airport’s Global Infrastructure Partners have announced that it is selling a 50.01 per cent stake to VINCI Airports, one of the world’s leading air travel facility operators, which signalled investment in the Scottish site.
Gordon Dewar, chief executive of Edinburgh Airport, said it is expecting to welcome more than 15 million passengers this year, a record, beating 14.4 million passengers last year.
Scotland’s busiest airport is reckoning on 20 million passengers by 2030.
He also said: “I think one of the biggest areas that I would like to get more clarity on and I think there is a huge opportunity for us is taking a more proactive lead on the decarbonisation of aviation, with things like sustainable aviation fuel, which is a perfect fit for that decarbonising of the Scottish oil and gas industry, where the assets are there, we’ve got a huge surplus of offshore wind power coming at us, so it is about taking all of these opportunities and putting them together as a team, team Scotland, and give ourselves a chance of really demonstrating that we can be a world leader in this, which there’s lots of chat about but not enough practical plans and projects. I think if we put our heads together we can find them and deliver against them.”
Mr Dewar said earlier that the airport, “like many businesses” is looking for a stable policy environment, saying: “Let’s make sure we take the opportunity to at least not put taxes up, let’s make sure that we’ve got a wider spatial strategy and see how the airports fit in with surface access across Scotland about how it fits working with government to promote the benefits of that connectivity, everything from VisitScotland adverting campaigns, down to universities and exports and so on.
“So it is about trying to make sure that we take this rapid recovery which Scotland is so reliant on in so many sectors and make sure we don’t waste that opportunity, and by that it is putting our best foot forward and telling airlines they will be welcome, telling people on the flights that they would want to invest here or stay here or study here.”
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Gail Taylor, chief commercial officer (non aero), Edinburgh Airport also points to the role government could play in driving a countrywide connectivity strategy
She said: “The government has a really important role in this area as it can provide the framework for success. If it recognises that our airports are critical pieces of national infrastructure then it means we can begin to treat them as such, and prioritise what they need.
“In the most simplest terms, it’s getting people from A to B in the most efficient and easiest way possible – but we won’t be able to truly realise that until we regard our airports as key national and international facilitators rather than local hubs.
“Edinburgh Airport isn’t just Edinburgh’s airport. It’s Scotland’s airport, with passengers coming from all over the country to fly from there. It should be incumbent on us to ensure they can get here with ease and access the fantastic connectivity that we have.
She said practical first steps to help partners focus on a wider strategy include: “Recognising Edinburgh Airport as critical national infrastructure and move away from this perception that we cannot talk about aviation’s role in facilitating success and prosperity.
“We know aviation has a challenge to decarbonise in its move to a sustainable future and that work within the industry is already ongoing. It might take time but aviation has to be part of the conversation when it brings so much to Scotland, whether that be investment, jobs and economic impact, as well as take people on their holidays or open up our businesses to a global market.
“All of this depends on ease of access to and from the airport, which is what our Surface Access Strategy speaks to. It’s about enabling us to enable Scotland and we hope the government can help us with that.”
Edinburgh is currently working with 37 airlines and flying to 159 destinations, which it said makes it “a major economic driver for Scotland”.
Ms Taylor said government could also be “more flexible in their approach to route growth and route support”.
She said: “We’ve long said that our support networks need to be agile and responsive to changing and emerging markets, challenges and opportunities, so working to a set list of ‘target’ countries only narrows our potential market when we should be open to all.
“We are a country that is proudly international in its outlook and we have a unique selling point in terms of the world’s fascination with Scotland. We should harness that and develop and maintain the connections we have while we look to attract new markets to the story of Scotland.”
The Scottish Government, which said its funding package around business rates was worth more to firms, said its aviation strategy, originally due for publication last year is imminent.
Jim Fairlie, Minister for Connectivity, said: “Scotland is open for business. Given the significant challenges that Brexit continues to create, it is more important than ever that we grow our international connectivity in support of our economy, our workforces and our society.
“The Scottish Government will soon publish its Aviation Statement, which will set out the actions ministers will take to strengthen Scotland’s international connectivity, to help reduce emissions from aviation and to secure lifeline services in the Highlands and Islands.
“It will highlight the strategic importance of aviation to Scotland and stimulate a positive conversation about how best to harness the significant economic, social and cultural benefits it provides.”
Mr Fairlie said: “Transport Scotland, VisitScotland and Scottish Development International work as one Government team to help Scotland’s airports grow international connectivity while not returning to previous levels of emissions. The Scottish Government role is a supportive one and we have helped to attract numerous new routes in recent years, including to key markets and hubs in North America, the Middle East, China and Europe.
“Earlier this month JetBlue started their first ever Scottish service, enhancing Scotland’s direct connectivity to the US and strengthening important links for business connectivity, exports and inbound tourism.
“SAF will be a major part of the global effort to decarbonise aviation and this worldwide transition presents significant economic and environmental opportunities for Scotland. Ministers have established an expert group to provide advice on the opportunities for increasing SAF production and use in Scotland, including how Scottish Government policy could help to support those opportunities.”
The Scottish Government also said that “the routes that we continue to target are in line with the key markets for inbound tourism, business connectivity and export growth”.
Aviation is a lifeline service in Scotland with Highlands and Islands Airports Limited (HIAL) operating across Barra, Benbecula, Campbeltown, Dundee, Inverness, Islay, Kirkwall, Stornoway, Sumburgh, Tiree and Wick John O'Groats.
The Scottish Government-owned airports saw passenger numbers hit 1.4million last year, up 39% on the year before and 90% of the pre-pandemic tally.
It has set out the foundations for maintaining a sustainable regional airport network for the future in its strategic plan.
A HIAL spokesperson said: “HIAL’s mission is to operate a safe, resilient, and sustainable network of regional airports to enable air connectivity, and support lifeline services for the communities we serve.
“Our airports are a vital element of Scotland’s transport network and support the economic and cultural life of these communities.”
The spokesperson added: “Supported by Transport Scotland, a strategic priority is to enable essential air services in the short, medium, and longer term for Scotland’s more remote regions.
“As with other organisations, HIAL continues to face considerable economic and financial challenges and our focus is to deliver safe and regulatory compliant operations that sustain the longevity of our airports.”
The fate of the Prestwick Airport, also Scottish Government-owned, still hangs in the balance, although it is also looking to the future and said in its strategy: “We also are working on supporting the change to sustainable aviation fuel and in partnership with BP look to not only supply SAF to aircraft using Prestwick but to become a key supply point for SAF in Scotland.”
It put out a fourth consecutive annual profit in its last accounts when it reported 459,000, up from 118,000 the year before.
The Ayrshire airport has 330 workers and posted an operating profit of £2.1 million.
The facility is currently going through a sale process.
A Scottish Government spokesperson said: “In January, the then Cabinet Secretary for Wellbeing Economy, Fair Work and Energy Neil Gray updated the Scottish Parliament on the status of Glasgow Prestwick Airport and confirmed that expressions of interest had been received.
“It would not be appropriate to share further details, including the number or identity of organisations behind an expression of interest, at this time. The Scottish Parliament will be updated when appropriate.”
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