Sale of Edinburgh or Glasgow airport could boost rivalry

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Car Rental News - 11/09/2008

 

The two cities, rivals for centuries in matters of culture and sport, may extend that competitiveness to the air.

The monopoly watchdog issued a report recently that claimed the lack of competition in the Scottish airport industry may actually be hurting airport customers – both individuals who fly and airlines. As the owner of airports in both Glasgow and Edinburgh, BAA may well be required to sell one of the two airports, to ensure the encouragement of competition and the best possible service and prices for customers.

While it is hoped that a break-up of the monopolistic hold on Scottish airports would lead to lower fees to airlines and more attractive airfares for passengers, it is also expected that interest in investment in the airports will grow. Edinburgh Airport in particular would benefit from private investment in its infrastructure so that it could handle long-haul services.

Many industry observers admit that BAA’s ownership of the two airports has led to reduced competitiveness between the two, but there is not widespread agreement as to whether this is a positive or a negative for the flying public.

Airlines frequently complain about BAA’s monopoly, but Ferrovial – the Spanish owner of BAA – has a history of substantially investing in its facilities. In 2008, the operator made capital investments in Edinburgh of £45 million.

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