Doncaster Sheffield Airport (DSA) is set to close after owner Peel Group announced it had failed to find a buyer or to address a “fundamental lack of financial viability”.
In a statement, Peel said: “The high fixed costs associated with running a safe, regulated airport, together with recent events materially reducing prospective future aviation income streams, mean 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.
“Peel received a letter from the Mayor of South Yorkshire and Mayor of Doncaster on 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, the statement said.
“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.”
‘Absence of actual proposals’
The company added: “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.”
Lack of current or prospective revenue streams
Robert Hough, chairman of Peel Airports Group, which includes Doncaster Sheffield Airport, said: “We recognise that this will come as a great disappointment to many. The intractable problem remains the fundamental and insufficient lack of current or prospective revenue streams, together with the airport’s high operating costs.
“Our employees have always been DSA’s greatest asset, and we are grateful to them all, past and present, for their dedication and diligence over the years. The immediate priority remains to continue engaging closely with them over the next few weeks.
“As such, DSA will now begin a formal process of consulting with team members. We will do everything we can to minimise the impact of these proposals and work closely with local authorities and agencies to support our employees through what we know will be an extremely difficult period. DSA has remained in contact with union representatives on site throughout and we are committed to ensuring they are updated through every step of this next phase.”