Faro’s growth driven by low-cost routes from UK; Ryanair second biggest airline this winter

Image: Ryanair, Faro Airport and Algarve Tourism press conference
At end of October Ryanair, Faro Airport and Algarve Tourism held a press conference to announce the launch of four new routes from Faro – Düsseldorf Weeze, East Midlands, Glasgow and Liverpool. It is estimated they will generate 160,000 additional annual passengers for Faro.

Faro airport, which serves the Algarve region of Portugal, has seen traffic grow by 56% from 3.5 million annual passengers in 1996 to just under 5.5 million in 2007. However, while traffic from the UK has doubled from 1.6 million to 3.2 million during this period, passenger numbers from other countries have grown by just 18%.

Chart: Faro traffic 1996-2007 Annual passengers (millions)
Source: ANA, UK CAA

Traffic has grown by 17% in the last two years after six years of relatively stable demand. During this period growth from non-UK markets (+18%) has been slightly higher than from the UK (+16%). Since Go started scheduled low-cost services from Stansted to Faro in March 1999, scheduled airlines in the UK have gradually taken passengers from the traditional charter carriers while at the same time stimulating considerable extra traffic.

Chart: Faro airport seasonality (Monthly passengers)
Source: ANA
Image: Ryanair launch Faro-Düsseldorf Weeze service
Ryanair launched Faro-Düsseldorf Weeze services on 30 October. Flights are operated three times per week.

So far in 2008 passenger numbers have been almost identical to those achieved in 2007. The airport suffers hugely from seasonality with demand in the peak month of August four and a half times greater than in the off-peak period of December and January.

UK market and airlines dominate

Between 2000 and 2004 traffic at Faro airport remained virtually unchanged. However, non-UK passengers fell by half a million while the UK market grew by the same amount. The leading country markets during this summer’s peak (August) show how dominant the UK market is.

Country Frequency share Capacity share Number of airline routes
United Kingdom 62.3% 64.2% 46
Germany 11.4% 11.3% 23
Ireland 6.7% 7.3% 5
Portugal 7.0% 5.3% 2
Netherlands 3.5% 3.1% 3
Belgium 3.3% 3.0% 3
Source: OAG Max Online for w/c 4 August 2008

The above table includes only scheduled services. In addition there are charter flights from most of the leading country markets.

In terms of weekly departures the leading scheduled airline at Faro this summer by a considerable margin was easyJet with almost three times as many flights as its nearest rival Monarch. easyJet acquired Go’s London Stansted and Bristol services in 2002 and has since added connections from seven other UK airports starting with Luton in April 2003.

Chart: Top 12 airlines at Faro (Weekly scheduled departures in August & November)
Source: OAG Max Online for w/c 4 August 2008 and w/c 3 November 2008
Image: Aer Lingus launch a three times weekly service from Belfast International to Faro
Aer Lingus launched a three times weekly service from Belfast International to Faro in February.

TAP ranks third thanks to its four daily flights to Lisbon. For this winter easyJet has reduced its flights to Faro by 50% but is still the busiest scheduled airline at the airport. Although Ryanair has added just two weekly frequencies between August and November it has added new routes from Dűsseldorf Weeze, East Midlands, Glasgow Prestwick and Liverpool, all of which started at the end of October. All Ryanair routes this winter are served no more than thrice-weekly. The airline did start a daily service to Madrid in November 2006 but this was abandoned a year later.

Since the beginning of the year other new services have been added by Aer Arann (to Waterford), Aer Lingus (Belfast International), easyJet (Glasgow), Ryanair (London Stansted) and Swiss (to Zurich). Next month Transavia starts flights to its new mini-base in Copenhagen replacing the now defunct Sterling service.


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