25th September 2017

Airline head-to-head could be damaging in long-term, says Loganair chief

Loganair chief Jonathan Hinkles has warned there could be longer term damage to services as the airline goes head to head with Flybe on flights to and from the isles.

Loganair managing director Jonathan Hinkles.

As of September Loganair will be flying solo, though Mr Hinkles stressed today in an external transport forum it is up for the fight with Flybe, which has agreed a new deal with Eastern Airways.

Local politicians have welcomed the move in the belief that competition on the Shetland route will in turn bring down prices. Though Mr Hinkles said: “Flybe are frankly going to try and kill us”.

Mr Hinkles said while Loganair would increase the number of cheaper seats to Aberdeen and offer a “short-term bonanza” with eight flights Flybe had “walked into a room with a hand grenade” which was going to damage both airlines and ferry company NorthLink.

He argued Loganair would offer five flights a day to Aberdeen compared to three by its competitors, as well as a morning and evening service to Edinburgh and flights to Inverness and Kirkwall.

Flybe, he claimed had agreed to offer flights on the Shetland route for only a year. Their top fare was £20 higher than Loganair’s and his airline included a free 20kg baggage allowance and no credit charge for bookings.

He said Loganair was also “protecting connections” to Manchester and London and announced a new frequent flyers’ scheme available on all bookings from 1st September.

Unlike the current scheme, flyers could claim back a flight after 17 return flights rather than 28. Loganair will offer 24 flights a week to and from Shetland.

It will also be re-introducing a Saab 2000 aircraft to three out of five of its Aberdeen flights from September.

Last month, Mr Hinkles said, was the busiest June at Sumburgh in five years, with about 17,600 passengers, up 10 per cent on last year.

Asked after the meeting what the worst case scenario of the competition with Flybe might be, Mr Hinkles, said: “It could be committing all parties involved in this to losses of several millions.”

A greater number of cheaper seats to Aberdeen would affect NorthLink, he said, and if NorthLink’s revenue fell, then a question would need to be asked whether subsidy from the Scottish government would go up.

It also raised issues around a rise in the air discount bill, air services and replacement aircraft, he said.

He stressed in the last two years great deal of work had been done to tackle delays and cancellations and improve reliability.

“In the longer term we have to replace our fleet of aircraft, we know that, but this is not helpful… there are timescales that may go back as a result.”

He urged members of the committee to back the local airline and hoped customers in Shetland would do the same.

Last month Flybe said it was going up against its outgoing partner, after announcing an agreement with Eastern Airways. The  partnership would mean flights being offered between Shetland, Aberdeen, Edinburgh and Glasgow.

It came only six months after an announcement that Loganair and Flybe would end their long-standing franchise agreement.

Flybe later issued a statement expressing disappointment with Mr Hinkles’ approach and accused him of inaccuracies.

The statement from the airline’s press office read: “Flybe is extremely disappointed by the inaccuracies voiced by Mr Hinkles as reported. Flybe has been serving Scotland for over 20 years and remains fully committed to continuing to provide customers with the widest possible choice of affordable travel options in an environment of healthy competition.

“This includes those routes operating from 1st September to the Highlands and Islands from Aberdeen, Edinburgh and Glasgow.”

About Adam Guest

Reporter for The Shetland Times. I have also worked as a senior news reporter at The Press and Journal, The Barnsley Chronicle and as a freelance reporter for The Doncaster Free Press. Alongside news reporting I specialise in music and sports journalism. Pork pie lover.

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8 comments

  1. Paul Simmons

    If Mr Hinkles’ product and service advantages are as strong and as differentiated as he says they are, then Loganair will have nothing to fear from competition. So I’m not sure why he is complaining so much?

    Reply
    • Jonathan Hinkles

      Paul, the outcome will indeed be determined by our customers, based their view of price and service for each journey they take. However, I believe that the huge increase in air seats to and from Shetland from 1 September can only result in serious economic damage to Shetland’s transport links (both air and ferry).

      Bob Crandall, American Airlines’ long-serving Chairman and CEO, once said “This industry is always in the grip of its dumbest competitors”. Creating a 92% increase in air seats to and from Sumburgh fits with that comment, in my view; I do not believe that level of capacity is remotely sustainable. [Assuming you are Paul Simmons who was Flybe’s Chief Commercial Officer, I’m sure you’ll also have seen the effects of capacity dumping at first hand.] That will have community implications, and I was encouraged to hear at Wednesday’s meeting in Shetland, on which this news article reports, that the potential longer-term impact of this was recognised.

      Shetland has to have long-term sustainability of frequent transport links and this move could place that at risk. It’s right for us to call that out – which is firmly what I’m doing as opposed to complaining!

      Reply
  2. Alvin Leong

    Booking a fly-through from the Isles to international destination on BA is no longer possible for dates after mid-August, why don’t he go and sort that one instead of moaning about FlyBe? Fly-through on a single ticket was promised when he decided to go solo.

    Reply
    • Jonathan Hinkles

      Alvin, I’m sorry that this has taken a little longer than we’d hoped, but I’m pleased to say that through-booking will be available under our partnership with British Airways in the next few weeks. Testing between our systems is well under way. This will include the Air Discount Scheme on the first leg of your journey from Shetland.

      Reply
    • Alvin Leong

      Sorry, I mean interlining tickets with BA, not fly-through with themselves.

      Reply
  3. Charles Tait

    Try booking flights via FlyBe and check out the baggage charges per sector. End of story: support Loganair if you want air services

    Reply
  4. Andy Holt

    Jonathan Hinkles has nothing to worry about from Flymaybe. In my experience the lateness and last minute cancellations due to “mechanical faults” would have put any other business out of the game years ago. This is sour grapes from a monopolist. If Loganair can provide a reliable service at reasonable prices with enough respect for the customer to provide informative announcements when things do go wrong he should see off the opposition.

    Reply
  5. samuel barlow

    looking it as a negative will result in it becoming so. its a challenge to increase your customer base. reduce your fairs and get promoting shetland. make some packages up. the hotels claim to be suffering due to the oil workers going. same with he coaches.go for it.

    Reply

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