Shannon taxes CityJet's thinking

RYANAIR AND Aer Lingus aren't the only airlines grumbling about the Government's Budget day decision to impose a €10 each way…

RYANAIR AND Aer Lingus aren't the only airlines grumbling about the Government's Budget day decision to impose a €10 each way exit tax on flights over 300km from March 30th.

CityJet boss Geoffrey O'Byrne-White says the move could result in his airline, which is a subsidiary of Air France, scrapping any plans to begin a service between Shannon and London City Airport, where the Irish airline is one of the biggest slot holders.

CityJet has been examining the feasibility of this route for some time, but was constrained by a lack of available aircraft.

The decision last week by the Office of Fair Trading in Britain to give its merger with Belgian regional airline VLM the green light means CityJet now has the capacity to add to its existing Shannon-Paris service.

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Flights from Shannon to London City Airport would help plug a gap left by Aer Lingus's controversial withdrawal from the Heathrow route last year.

"This isn't good news at all," O'Byrne-White told me last week. "It doesn't make any sense for Shannon at a time when Government policy is to develop a counterbalance to Dublin. We will be arguing that it should be repealed for Shannon . . . the amount of money involved is minimal."

Ironically, some international flights from Dublin will qualify for the lesser €2 exit tax for flights under 300km, but none from Shannon meet the criteria.

So will this force CityJet to scrap plans to fly from Shannon to London City? "It could do," he said.

"We have to evaluate where we put our aircraft and crew and this doesn't help Shannon's case. I think the decision is very wrong."

Of course, you could argue that CityJet's passengers are mostly business travellers, who won't exactly balk at having a tenner added to the price of their ticket.

"It's not all business passengers," O'Byrne-White. "At the end of day, it means that the economics of the route have been altered compared with other destinations we would look at."