The boss of Birmingham Airport has admitted that increasingly onerous security measures, the shrinking economy and the challenges of climate change have made the last two years the most difficult of his career.
Speaking as the airport launched a new era under its new brand without the word ‘‘International’’ in its name, Paul Kehoe said the perfect storm of circumstances was unprecedented during his career.
“I have been here for exactly two years and it has been the worst two years of my life from an economic point of view,” he said. “I have a brilliant team here in Birmingham but when the market turned I had never seen anything like it.”
One of the biggest challenges – and expenses – facing airports over the last few years has been security, an issue brought to the top of the agenda again this week by the discovery of the freight bombs from the Yemen.
Ironically, just days earlier British Airways chairman Martin Broughton said he believed some airport security checks should be scrapped, claiming measures like making all passengers take off their shoes or scanning laptops separately were unnecessary, a position supported by Mr Kehoe whose airport will hardly be affected by the new restrictions due to its low volume of freight traffic.
“The bottom line is that we do as we are told to do,” he said. “The real issue is that in the past, every time there is an incident we put in a layer of security to manage that and we have ended up with this multi-layered approach. He is saying ‘Let’s have a look and see if this is the right way of doing it’.”
But ensuring security remains robust enough to safeguard passengers as well as reassure them is undoubtedly another major cost in an era of rising costs.
“It is very simple,’’ Mr Kehoe said. ‘‘You can’t make a profit on airport security. It is a direct cost and part of our licence to operate.”
However, he said recent ministerial utterings suggested a less prescriptive “outcome strategy” were being discussed, although this also raised other issues.
“We are told ‘these are prohibited’ and then we would decide how we stop them. Different airports may use different ways of doing this so it could confuse but if it can deliver passengers safely without having to get undressed and removing your shoes and so on then that is ideal.”
And Mr Kehoe believes there are new systems that can speed up security such as more sophisticated scanners and chemical analysing equipment and possibly even profiling.
“The reality is 99.9 per cent of passengers are not terrorists but there is a 0.1 per cent who may be. Profiling is not about ethnicity but about people exhibiting signs that they shouldn’t be doing what they are doing. Ultimately, we want to get back to 50 years ago when flying was a delight rather than a chore.”
In fact, take the security issues alongside the economy and the challenges of addressing climate change and Mr Kehoe freely admits things have not been easy.
“There are 56 public service airports in the UK and they have lost 30-40 million passengers – that could be £400 million off the bottom line and that has a real effect on jobs and the local economy. Fuel is also looking like it’s going back up – it was $140 a barrel at one point and is now around $76 but rising to $90 in the new year.”
Nevertheless, with British Airways recently posting its first quarter profits for two years and similarly encouraging numbers for some US carriers, Mr Kehoe suggests better times are ahead and highlighted the growth of Emirates out of Birmingham, which has seen a 26 per cent rise in passenger numbers in September alone and can now deliver 1,000 people a day to and from Dubai.
“If they continue like this they will overtake Dublin as our most popular route,” said Mr Kehoe.
And the economic impact of a direct link with the United Arab Emirate sheikdom cannot be underestimated with the North-east seeing a trebling of business with Australia to around £300 million in just the first year of Emirates introducing a direct day flight from Newcastle.
But it is not just Emirates that is seeing an upturn in business.
“We are seeing growth again in short-haul with carriers like Lufthansa, KLM and flybe,’’ he said. ‘‘We are seeing the business travellers, those visiting friends and family and holidaymakers, but the discretionary weekend traveller has been impacted and I believe the volcano is still a factor.”
As for the proposed runway extension, there is plenty going on behind the scenes but no tractor tearing up the A45 just yet although he says the board is in agreement and he has now been released to make it happen. He is under no illusions while being completely committed to its necessity.
“If the market continues to bump along the bottom then it may not sustain the business plan,” he admits. “But we must increasingly look east for new markets.
‘‘In China there are 247 urban centres with more than a million inhabitants and more than 90 new airports planned. The strength of their economy will mean they will want to travel and they can’t all get in Heathrow and Gatwick.
‘‘If we are well placed we can have people from companies like Tata or JCB travelling back and forward all the time. But there is no silver bullet – even if we build we are going to have to market like hell.
"It is not just a case of ‘If we build they will come’ when we are up against cities like Frankfurt, Barcelona and Madrid. This is a tremendously competitive market, but we are up for facing the challenge.”
All this comes as the airport launches into a new era with a new logo and minus a word, a move that shows how far it has come, according to Mr Kehoe.
“It is about a coming of age – if you have to have international in your name then you are not,” he said. “Birmingham international just is. There is one Birmingham International, and it’s in Alabama, and funnily enough it had a logo that looked just like ours.
“We’ve decided to change the way we do business and are creating a new identity that’s confident and a logo that embraces where we want to position ourselves. As well as being a local airport for local people, we are also looking around the globe and connecting 140 countries world-wide.
“We are making the investment in car-parking, the one terminal project, a new shopping experience. Ultimately it’s about a great service and increasing value for our shareholders.”
