Tuesday 29 April 2014
Treasury and Resources has today confirmed further details of the objectives it has agreed with Aurigny as shareholder in the Company, specifically around fares on the Gatwick route.
In 2012, Aurigny's average fare figure on the route when it was competing with Flybe was £63. This year, Aurigny has committed to offering 60% of its available fares on the Gatwick route at between £26 and £65 or less (excluding UK Air Passenger Duty of £13).
Commenting on the new commitments, Minister for the Treasury and Resources Department, Gavin St Pier, said:
"Entry level fares on Aurigny's Gatwick service currently start at £39, so with today's announcement, Aurigny will be sticking to the commitments it has previously made to ensure that residents and visitors alike have plenty of opportunity to travel to and from London at a sensible price.
These arrangements are in keeping with the undertaking given by the Department when it reported to the States in 2013 on the Gatwick services to look at introducing fare targets for Aurigny on the route to ensure that it continued to deliver an efficient operation.
"Importantly, Aurigny remains confident that it can deliver on these commitments whilst continuing to move towards a break-even position for the airline in 2015/16."
Aurigny's Chief Executive, Mark Darby, goes on to explain:
"Aurigny remains absolutely committed to delivering an efficient service that offers good value to Islanders. With this in mind, the airline will also be working throughout this year to reduce its controllable costs per available seat kilometre by 2.5%.
Our entry level fares are generally available to passengers who book early and are able to travel at off-peak periods. Unlike some of the headline fares offered by our competitors, Aurigny's fares are inclusive of baggage charges which can sometimes add over £20 in extra charges to the cost other airlines' return fares to the Islands."
Treasury has agreed a range of financial indicators with Aurigny that the airline will report on periodically, including its seat sales by fare value, so the Department can monitor its performance in this area. The fare targets will be reviewed on an annual basis so that any upward (or downward) changes in Aurigny's controllable and non-controllable costs, such as landing fees at Gatwick Airport, can be taken into account.