Should Norwich remove its Airport Development Fee?

During the 2000s, many airports introduced an Airport Development Fee yet these have gradually been removed - Newquay removed theirs in 2006 and Teesside will abolish their Development Fee from today (1 July 2021). Yet one airport has maintained their Development Fee - Norwich.

An Airport Development Fee (ADF) is to help fund further development of the airport's infrastructure and passenger facilities and to maintain and develop the airport's route network. Norwich introduced the fee in 2007 and is currently charged at £10 for adults. Norwich Airport states the airport has helped to increase holiday destinations and retain scheduled services at the airport and fund the refurbishment and extension of the airport's terminal. However, the airport is one of the few remaining airports in the United Kingdom to maintain an ADF. So, should Norwich remove their fee?

There are two noticeable examples of airports removing their fees - Newquay and Teesside.

Newquay removed their ADF in 2016 as part of a rebranding exercise for the airport and saw Ryanair return to the airport with flights to Alicante and Hahn (Hahn has since been cut) alongside Flybe adding Aberdeen and Doncaster/Sheffield to the airport (Flybe has now ceased operation). It is noted that Ryanair will only operate to airports that do not have an ADF and so the removal of the fee would be a noticeable reason for the airline to launch flights from the Cornish airport.

Furthermore, Newquay Airport has managed to substantially grow its network since the removal of the fee. Ryanair launched Faro flights in March 2017, British Airways launched a summer seasonal flight to Newquay in 2020, easyJet announced 3 new routes for Summer 2021 and Edelweiss Air is scheduled to launch a Zurich route in July 2021. The airport has shown that the removal of the ADF has instigated growth and new routes to a variety of domestic and international destinations. It is noted that Flybe was the largest carrier at Newquay before it ceased operations so a number of routes were launched to replace these flights, however, the removal of the ADF reduces the cost for travellers and therefore encourages passengers to fly from the airport.

On the other hand, Teesside has removed their fee from today - the same day that Ryanair has launched flights from the North East Airport (to Palma de Mallorca). Ryanair will operate four routes this summer - Alicante, Corfu, Faro and Palma de Mallorca and it is noticeable that the airline is only launching flights from the airport once the fee has been removed. Additionally, Loganair adds a Jersey route in June 2021 and TUI will return the airport for the first time in 9 years when it launches in 2022 with flights to Palma de Mallorca. All these flights show that the removal of the ADF has allowed the airport to increase its offering.

Removal of the ADF also encourages more passengers onto existing flights. The £10 fee at Teesside being cut will lower the total cost for the consumer on routes including Aberdeen, Belfast and London. By removing the fee, passengers have no additional costs which has appeared to be a deterrent in growth from the airport and should allow Teesside to maintain their primary catchment and reduce leakage to nearby Newcastle and Leeds airports.

How could the removal of ADF help Norwich?

Norwich has managed to maintain a sizeable year round base from TUI as well as year round flights with KLM and Loganair and summer seasonal flights from Aurigny and BH Air. However, it is noticeable that Norwich does not have a low cost carrier to help increase passenger numbers.

Ryanair serves 22 airports across the United Kingdom and launched flights to both Newquay and Teesside once the ADF was removed. Ryanair are the most likely low cost carrier to launch flights to Norwich due to their presence at many smaller airports. However, the airline has its largest base at nearby London Stansted as well as a smaller base at nearby London Southend. The airline may not want to discourage passengers from travelling to these airports, therefore it is no guarantee that the airport would be able to attract Europe's largest carrier.

The other airline that could start flights at Norwich is Wizz Air. The airline has been rapidly expanding across Europe and has launched 3 bases in the United Kingdom across 2020 and 2021. However, the airline only serves 11 airports including nearby London Southend which only has 1 route. The lack of presence in the local area and UK as a whole may lead to limited success at the East Anglian airport.

Norwich also has the factor of having a shorter runway than both Newquay and Teesside - at just 1,841m. This limited length is a deterrent for Boeing 737 operators including Ryanair which may not be able to operate at a full pay load. Additionally, Norwich suffers from having nearby London Stansted within 90 minutes of the airport as well as a low density catchment which is predominately east of the airport - meaning shorter travel times to London Stansted, Birmingham or East Midlands Airports - all of which having a substantial route network.

Should Norwich remove the ADF?

This is difficult to answer. On one hand, Norwich has done well to maintain the ADF and year round flights with KLM, Loganair and TUI as well as summer seasonal routes with Aurigny and BH Air. On the other hand, the removal of the fee could increase passenger numbers and attract a low cost carrier to the airport. If the airport is able to encourage a low cost carrier to operate a substantial network from the airport, it may be in the interests to remove the ADF. However, if the airport risks losing some of its established carriers - then it may not be worthwhile. Time will tell which option Norwich Airport will chose.

Photo: https://corporate.ryanair.com/media-centre/stock-images-gallery/