Shannon - Home | DTTAS Department of Transport, Tourism ... · PDF fileShannon, as outlined in this report, is conservatively projected to create and maintain 3,000-3,500 new direct

12 November 2012

ShannonAviation Business Development Task Force Final Report

ATC AirTrafficControl

CAGR CompoundAnnualGrowthRate

CAMO ContinuingAirworthinessMaintenanceOrganisation

CBP CustomsandBorderProtection

CFRAMS CatchmentFloodRiskAssessmentManagementStudy

DAA DublinAirportAuthority

DoECLG DepartmentofEnvironment,CommunityandLocalGovernment

DTTAS DepartmentofTransport,Tourism,andSport

EETC EnhancedEquipmentTrustCertificate

EI EnterpriseIreland

EIB EuropeanInvestmentBank

FDA FoodandDrugAdministration

GECAS GeneralElectricCapitalAviationServices

HEA HigherEducationAuthority

IAA IrishAviationAuthority

IASC InternationalAviationServicesCentre

ICAO InternationalCivilAviationOrganisation

IDA IndustrialDevelopmentAuthority

IFSC InternationalFinancialServicesCentre

LAP LocalAreaPlan

LCC LowCostCarrier

LIT LimerickInstituteofTechnology

MPL Multi-crewPilotLicence

MRO Maintenance,RepairandOverhaul

NRA NationalRoadsAuthority

NUI NationalUniversityofIreland

OEM OriginalEquipmentManufacturer

OPW OfficeofPublicWorks

SAA ShannonAirportAuthority

SD ShannonDevelopment

SFZ ShannonFreeZone

SME SmallandMediumEnterprise

UL UniversityofLimerick

Glossary

In May 2012 the Government made the decision in principle to separate Shannon Airport from the Dublin Airport Authority, and to merge it with Shannon Development.

The Government established two task forces to advise on how best this could be done. It has been my privilege to chair the Aviation Business Development Task Force. Our mandate has been to seek out new opportunities for an autonomous Shannon Airport and to evaluate the feasibility of creating an international aviation centre of excellence in Shannon.

In the course of this work, it has also been a privilege to discuss Shannon with very many individuals, companies, and organisations. We received numerous submissions and suggestions for development opportunities. Many people are passionate about Shannon’s future potential, and have shared with us their visions of what that future could look like.

Based on these discussions and on our own research, my Task Force colleagues and I have identified a range of both airline opportunities and aviation-related activities for which Shannon is well suited. We believe it’s possible to create a sustainable and thriving Shannon Airport alongside an International Aviation Services Centre, and this report sets out our findings.

I would like to thank the members of the Task Force, Patrick Edmond, the IAA, Claire O’Donoghue, the management of Shannon Airport and Shannon Development, KPMG, McCann Fitzgerald, officials in the DTTAS, DJEI and DoF, the Steering Group, John Fitzgerald, and the very many stakeholders for all of their ideas, help, hard work, time, persistence, co-operation and interaction over the last five months.

Rose Hynes 12th November 2012

Chairman’sForeword

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Contents

1. ExecutiveSummary 06

2. TermsofReference 12

3. BackgroundandContext 14

3.1. From the 1940s into the 21st century 14

3.2. Recent developments 14

3.3. Booz report 15

3.4. Task Force methodology and philosophy 15

3.5. Stakeholders 15

4. TheGlobalAviationIndustry 18

4.1. Overview 18

4.2. Key industry developments 18

4.2.1. Aircraft leasing 18

4.2.2. Legacy airlines and low-cost carriers 18

4.2.3. The bilateral system, traffic rights and Open Skies 19

4.2.4. Air cargo 19

4.2.5. New aircraft types and manufacturing techniques 19

4.2.6. Projected airline industry growth and resulting resource needs 20

5. AviationBusinessatShannon 22

5.1. Existing aviation businesses at Shannon 22

5.2. International Airport 23

5.2.1. Existing operations 23

5.2.2. Potential for Airport Operations 23

5.3. Maintenance, Repair and Overhaul (MRO) 27

5.3.1. General 27

5.3.2. Lease transition 27

5.3.3. Parting out 28

5.3.4. Designated Aircraft Parking 28

5.3.5. Continuing Airworthiness 29

5.3.6. Opportunities for Shannon 29

5.4. Pilot training 30

5.4.1. Industry requirements 30

5.4.2. Training syllabus evolution: MPL 30

5.4.3. Shannon opportunity 31

5.5. Education, technical training and consultancy 31

5.5.1. Engineers 31

5.5.2. ATC 31

5.5.3. Other aviation-industry staff 31

5.5.4. Third- and fourth-level education 32

5.6. Aviation software and systems development 33

5.7. Aviation Finance 33

5.8. Corporate and private aviation (business jets) 34

5.9. Regulatory compliance services 35

5.10. Specialist airline operations 35

5.11. Heritage, tourism and networks 36

5.11.1. National Aviation Museum 36

5.11.2. Aviation conference 36

03Report of the Aviation Business Development Task Force

6. EmploymentPotential 38

6.1. Ongoing IASC direct employment 38

7. CharacteristicsofNewEntity 40

7.1. Organisation 40

7.1.1. Merger of SAA and a restructured Shannon Development 40

7.1.2. SD property portfolio 40

7.1.3. Potential organisational structure and resourcing 40

7.2. Interface with state agencies (IDA, Enterprise Ireland, Fáilte Ireland) 40

7.2.1. IDA 40

7.2.2. Enterprise Ireland 41

7.2.3. Proposed operating framework with IDA and Enterprise Ireland 41

8. KeyIncentivesandEnablers 44

8.1. Key Enablers 44

8.1.1. Hangar development 44

8.1.2. Phased build-out 44

8.1.3. Funding mechanisms 44

8.1.4. Dedicated Aircraft parking areas 44

8.1.5. Office/light industrial space 45

8.1.6. Shannon Development real estate 45

8.1.7. Strategic Infrastructure provisions 46

8.1.8. Commercial rates and Development Contributions 46

8.1.9. Land use planning, and marketing of land bank 46

8.1.10. Access 47

8.1.11. Secondary enablers 47

i. Visas for non-EU nationals 47

ii. Ability for Shannon Chamber to certify Certificates of Origin 48

9. FeasibilityAssessment 50

9.1. Risks to delivery 51

10. Recommendations 54

10.1. Recommendations on Separation 54

10.2. Recommendations on Business Development 54

10.3. Other recommendations 56

10.4. All recommendations (in order of occurrence in report) 57

10.5. Next steps 59

11. Conclusion 62

AppendixATaskForceMembers 64

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1 ExecutiveSummary

An independent Shannon Airport, combined with a restructured Shannon Development, can be successful and sustainable. It can generate a large number of jobs and contribute significantly to the economic development of the Midwest region. This independent Shannon entity should have no requirement for exchequer funds.

This report sets out a vision for what that success looks like and how it can be achieved.

Shannon Airport is a major economic driver for the region. Today it employs some 230 people directly and supports a much larger number of indirect jobs, in addition to 1,600 staff employed in aviation-related businesses around the airport. The declining trend in air traffic at Shannon in recent years has given rise to justifiable concern for the future of the airport and the surrounding economy.

The Task Force is convinced that an autonomous Shannon Airport entity can not only develop its passenger traffic and route network but can safeguard existing employment and also create high levels of additional specialist employment in aviation services, establish Ireland as a worldwide centre of aviation-industry excellence, and anchor the aircraft leasing industry already present in this country.

An International Aviation Services Centre (IASC) at Shannon, as outlined in this report, is conservatively projected to create and maintain 3,000-3,500 new direct jobs within five years, not including construction jobs.

The Task Force has been guided by a desire not merely to deliver a set of proposals or leave behind a set of recommendations. Accordingly the group has sought, to the extent possible, to validate, develop, and advance and build momentum for those proposals in the course of its work.

The Task Force has been able to obtain specific commitments from two existing Shannon companies to expand their employment there in the context of an International Aviation Services Centre. These commitments account for almost 1,000 jobs in the next three to five years and are contingent on the separation of Shannon Airport from the DAA.

There is a real and substantial opportunity to develop such a Centre in Shannon, drawing on the area’s and Ireland’s existing assets to create a globally recognised aviation cluster combining established activities with innovative new projects.

This new entity, a commercial Semi-State body, would generate substantial employment, economic activity and Exchequer returns. It would also enhance Ireland’s international reputation as a location for aviation industry expertise, would underpin the development of traffic at Shannon Airport, and would reinforce the attractiveness of Ireland as a location for the aircraft leasing industry.

Background

The State Airports Act 2004 provides for Dublin, Shannon and Cork Airports to be established as independent and autonomous airports in the ownership of the State. In 2011, the Minister for Transport, Tourism and Sport commissioned a study on options for the future ownership and operation of Cork and Shannon Airports. This study was conducted by Booz & Co and was completed in December 2011.

One of the main recommendations of the Booz Report in respect of Shannon was that the airport could be separated from the DAA and could be combined with the adjacent Shannon Free Zone lands to provide a complementary revenue stream.

Drawing on the recommendations of the Booz Report, the Government made the decision in principle on May 8, 2012 to separate Shannon Airport from the Dublin Airport Authority and to form a new entity combining “a strong, independent Shannon Airport authority with the extensive property holdings, expertise and experience of Shannon Development.” The Aviation Business Development Task Force was established in June 2012 to evaluate aviation-related business opportunities for this new entity, assess the feasibility of creating an international aviation centre of excellence at Shannon, and consider options for the formation of this new entity.

The Task Force strongly concurs with the Booz Report recommendation to separate Shannon Airport from the DAA and combine it with the Shannon Free Zone lands, and sets out in this report how this can be achieved.

Thevision

The Booz report recommends the amalgamation of Shannon Airport with the adjacent Shannon Free Zone to enable the autonomous development of an aviation industrial park.


The Task Force concurs with this recommendation.

It is the firm view of the Task Force that an independent Shannon Airport, combined with Shannon Development’s property portfolio and associated expertise, can be successful.

This approach offers Shannon Airport a sustainable future as well as safeguarding and enhancing the airport’s role as an economic driver for the Midwest region and beyond.

In this report, the Task Force sets out a vision for what an aviation industry cluster at Shannon can achieve. This vision has been developed and validated through extensive stakeholder consultations and reflects the Task Force’s view of the potential industry sectors and employment which can be attracted to Shannon, given appropriate stakeholder support, incentives, and external (private-sector) financing.

The Business Plan for the new entity demonstrates its financial sustainability as required under the 2004 State Airports Act for the separation of Shannon Airport. It is purposely conservative in its assumptions, for example assuming no revenue whatsoever from IASC at this time, in order to demonstrate that the new entity can be sustainable even in this adverse case.

The business plan thus serves a different purpose to this report, and maps out a different trajectory.

Clearly it is expected that IASC will in fact make a positive contribution to the new entity’s finances, and this expectation is underpinned by the Task Force stakeholder consultations, but the preparation of a detailed master plan reflecting reasoned IASC revenues and costs will be the task of the incoming Board and management team of the new entity. This report sets out the elements that can serve as a foundation for such a master plan.

What does success look like for Shannon over a three to five-year timescale?

Within five years, the airport is a self-sustaining, cost-effective international airport. It welcomes circa two and a half million passengers per year (compared with 1.5 million in 2012), and offers a range of destinations both short-haul and long-haul, bringing visitors into the region and providing attractive and convenient travel options for local business and leisure travellers. The airport attracts new airline services through its competitive and flexible tariff

structure. It continues to differentiate itself from the DAA, attracting customers and winning their loyalty with a more convenient, efficient and enjoyable experience.

Within five years, the airport is also a strategic transit hub for passenger and cargo airlines who benefit from Shannon’s geographical position, US preclearance, and fifth-freedom rights (the right for an airline from one country to carry passengers between two other countries). As an example, the Russian carrier Transaero has publicly expressed interest in flying from Moscow via Shannon to the United States and in carrying Irish and American passengers between Ireland and the US. Airlines carrying cargo can benefit from a dedicated cargo terminal, which also enhances the competitiveness of Irish exporters in sectors as diverse as pharmaceuticals and seafood.

Within five years, an International Aviation Services Centre (IASC), based at Shannon, is a vibrant and growing cluster of diverse, international, primarily aviation-related businesses built around the airfield and its surrounding lands, providing skilled employment as well as training and education opportunities. As part of its offer to businesses, IASC draws on the availability of vacant property in the Shannon Free Zone, as well as the possible expansion of the airfield boundary into the Free Zone lands.

Opportunity for creation of an International Aviation Services Centre

A new entity combining Shannon Airport and a restructured Shannon Development will be better able to address the business opportunities that the global aviation industry offers.

The industry is growing rapidly:

• About 22,000 commercial aircraft are in service worldwide, and about 1,350 new aircraft are delivered each year.

• Over 35% of the worldwide commercial aircraft fleet is owned by leasing companies, a share which is projected to grow to over 50% in the coming decade.

• These aircraft require regular maintenance, as well as specific modifications as they move from one airline to another. The aircraft maintenance market worldwide will be worth an estimated $50 billion by 2014.

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• To operate and maintain this growing fleet of aircraft, half a million new commercial pilots will have to be trained worldwide in the coming 20 years, as well as 600,000 aircraft maintenance engineers.

The proposal to develop an international aviation cluster at Shannon would draw on an existing, vibrant, broad-based group of aviation companies already active in the region. Approximately 40 firms already employ 1,600 staff in aviation-related activities in the area, with a particular focus on maintenance and on leasing in addition to the operations of the airport itself. Many new aircraft now entering service are built from new composite materials, and this will be a major growth area in the next decade. Shannon firms are already developing their capabilities to design and repair these composite materials.

Shannon has a number of major advantages for the development of aviation services businesses: an international airport with a long runway, uncongested airspace and ample adjacent land. The combined land banks of Shannon Airport and the Shannon Free Zone total about 1,150 hectares and together represent a superb asset for the development of new aerospace activities.

Combined with the availability of a skilled English-speaking workforce and Ireland’s strong relationships with the aircraft leasing community, Shannon is a very favourable location for the development of an international aviation industry cluster. Many existing aviation clusters worldwide lack at least some of these strengths.

The Task Force is satisfied there is a genuine opportunity to create a new entity, an internationally competitive International Aviation Services Centre (IASC) at Shannon, which would build on Ireland’s strengths and would serve to anchor the aviation and aircraft leasing & financing industries already present in Ireland.

Foundationsforsuccess

The legislation providing for the separation of Shannon Airport, the 2004 State Airports Act, is already in place.

A separate integrated Business Plan has been prepared, under the provisions of this Act, including Shannon Airport, Shannon Development, and an International Aviation Services Centre.

This report sets out the vision for the future of Shannon, which the Task Force believes to be achievable. The Business Plan provides the implementation details for the creation of the new entity and the underlying assumptions.

The assumptions in the Business Plan are considered to be conservative. The overall feasibility of the plan has been independently evaluated by KPMG on behalf of the Department of Transport, Tourism, and Sport. The Business Plan provides for:

• Positive operating cash flows

• Adequate capital expenditure funding

• No Exchequer funding requirement

• Working capital provision already agreed with banks

The Dublin Airport Authority and the Shannon Airport Authority have already completed transition plans to facilitate separation by the end of 2012.

The Task Force has consulted and has received input from a wide range of industry and community stakeholders, over 100 in total, in Ireland and overseas. There has been wide stakeholder support for the decision in principle to separate Shannon Airport from the DAA and for the concept of an aviation centre of excellence. There is also wide stakeholder acknowledgement that the status quo is unsustainable and that without radical change, Shannon will continue its decline.

Jobcreation

Over a five-year period it is estimated that the new International Aviation Services Centre could create and sustain 3,000-3,500 new direct jobs in Shannon. This figure does not include construction jobs. Nor does it include significant additional employment creation potential from other projects that the Task Force has identified. These projects seek to apply “outside the box thinking” to drive innovation in diverse aspects of the aviation industry and have the potential to be transformative both in industry practices and in job creation.

The ability of the new entity to achieve this job creation potential depends on several factors:

• The availability of appropriate physical infrastructure

• A central marketing and development staff,


with appropriate skills, expertise and capability to effectively promote the Centre in Ireland and overseas, in co-ordination with other stakeholders

• Support from other State agencies, including grant aid in line with the agencies’ existing guidelines

• A competitive cost base

• An appropriate incentive package

In turn the provision of appropriate infrastructure is dependent on external (third-party) financing becoming available, for example via the European Investment Bank. The Department of Finance has already had initial discussions with the EIB in this regard.

The delivery of the estimated jobs potential, and of the increased passenger throughput at the airport, will require sustained and focused effort on the part of the new entity, and the support of all stakeholders. This is a challenging task but it is achievable.

The Task Force has been able to obtain specific commitments from two existing Shannon companies to expand their employment there in the context of an International Aviation Services Centre. These two commitments alone account for approximately 1,000 jobs and serve to demonstrate the feasibility of the overall job creation estimate. These commitments are contingent on the separation of Shannon Airport from the DAA.

Competitivenessandnextsteps

Many of the activities contemplated for the International Aviation Services Centre are capital-intensive and employment-intensive, often requiring specific skills. Competing industry clusters worldwide may suffer from weaknesses such as a shortage of skilled labour or of land, a lack of fluency in English or poor links with key industry sectors such as lessors. Without exception, though, they enjoy strong state support and commitment. The global nature of the competition means that in order to succeed, such a centre in Shannon must be able to build on appropriate foundations in terms of incentives and cost structure. The Task Force has made a separate submission to the Department of Finance on possible incentives for the aviation sector in Ireland, and Shannon would be in a position to take advantage of any such incentives.

In a highly competitive global market, the new entity will have to deliver conspicuous value for money, whether to win new airline business or to attract new industrial developments. This in turn will require a competitive cost structure. Shannon Airport’s cost base is currently higher than its industry peers, in part because of its reduced traffic levels. Productivity improvements and flexible work practices can help to reduce this disadvantage. Unless the new entity can align its cost base with that of its competitors, it will be unable to compete and to develop its activities.

Air traffic growth at Shannon Airport and the acquisition of new business is largely contingent on separation of the airport from the DAA. It is therefore essential to eliminate the current uncertainty surrounding the status of Shannon Airport without delay, in order to maintain the momentum and goodwill that exists among stakeholders. It is the recommendation of the Task Force that the creation of the new entity proceed on a phased basis, under which the airport is separated first. A reconstituted Board and a CEO for the new entity should also be appointed as early as possible.

The Business Plan assumes that the restructured Shannon Development will be merged into this new entity from 1 July 2013, allowing for the transition of Shannon Development enterprise and tourism functions to Enterprise Ireland, the IDA and Fáilte Ireland. As part of the creation of the new entity, an operating framework will be agreed with these agencies.

Conclusion

The Task Force is convinced that an independent Shannon entity can be financially and commercially successful and recommends the establishment of this new entity without delay.

The separation of Shannon Airport from the DAA is the single most important enabler of this future success. A failure to move forward with separation will lead inexorably to the further decline of the airport and the surrounding region. This need not happen. The opportunity now exists not only to safeguard the future of Shannon Airport, but also to create a truly globally significant international aviation services centre, which will be an economic driver for the Midwest region and for the country as a whole and which has the potential to create thousands of new jobs.

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2 TermsofReference

The terms of reference of the Aviation Business Development Task Force are as follows:

1 To seek out and evaluate aviation-linked business opportunities that could be associated with the new entity.

2 To assess the feasibility of creating an international aviation centre of excellence centred on Shannon Airport.

3 To explore options and develop proposals for the formation of the new entity of Shannon Airport and Shannon Development, taking particular account of the need for the new entity to collaborate with the IDA and Enterprise Ireland, using its property portfolio in conjunction with the airport business as a catalyst for the development of strategic sectoral opportunities for the region, specifically within the aviation sector and, as required, to continue to support the property needs of certain IDA/EI clients.

4 To consider issues arising in relation to possible tax incentives, State Aid, competition, and any other relevant matters.

5 To consult with relevant stakeholders as required.

6 To set up working groups, if required, for specific tasks.

7 To bring forward proposals addressing all relevant issues in this regard, including a corporate plan for new businesses, to the Steering Group by 16 November 2012.

8 For the Chair to interact closely with the Steering Group and with the Chair of the Change Management Task Force, as appropriate, on issues which impact on the work of both Task Forces (including where relevant the preparation of combined proposals for the new entity).

The members of the Aviation Business Development Task Force are listed in Appendix A.

On 8 May 2012, the Government decided in principle to separate Shannon Airport from the Dublin Airport Authority (DAA) and bring it together with Shannon Development to form a new entity with a commercial mandate in public ownership. The Government also decided that the existing ownership of Cork Airport by the Dublin Airport Authority (DAA) would be maintained with the DAA to be renamed in the near future.

The Minister for Transport, Tourism and Sport and the Minister for Jobs, Enterprise and Innovation have established a Steering Group to bring forward proposals for the implementation of that decision. Two Task Forces to assist the Steering Group in its work have also been established: the Aviation Business Development Task Force and the Change Management Task Force.


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3 BackgroundandContext

3.1Fromthe1940sintothe21stcentury

Shannon Airport occupies a unique place in Irish and world aviation. An airport was first established in the late 1940s at Rinéanna as a successor to the Foynes seaplane base for the landplanes that were emerging as the dominant form of air transport. Until the widespread entry into service in the late 1950s of jet airliners such as the Boeing 707, transatlantic airliners required one or more refuelling stops, of which Shannon and Gander became the best established.

Under the visionary guidance of Brendan O’Regan, Shannon Airport continued to innovate, establishing the world’s first duty-free shop in 1950. The Shannon Free Airport Development Company later created a range of tourist attractions in the region such as the well-known Bunratty Castle medieval banquets and Folk Park, as well as the Shannon Free Zone as a nexus of export industry.

By the 1970s, when the majority of third-country transatlantic flights were overflying Shannon, Aeroflot used the airport as a transit stop for flights to the United States, Canada, and the Caribbean, which saw Russian crews staying in Shannon and Russian fuel being supplied by ship to Shannon’s fuel farm. Shannon’s significance to Aeroflot’s network reduced

after the fall of the Soviet Union, when the airline was able to re-equip with longer-range Western aircraft and no longer required a technical stop on its transatlantic flights.

Shannon Airport had for many years been the designated Irish gateway for transatlantic services, such that all transatlantic flights to and from Ireland had to stop there. The dilution of this mandated stopover under the 1993 Ireland-US bilateral agreement, and its elimination under the 2007 EU/US Open Skies Agreement, allowed airlines to serve Dublin directly and contributed to an increase in the range and capacity of Ireland-US services. At the same time, Shannon saw a reduction in its transatlantic passenger numbers and the West of Ireland experienced a fall in the number of North American tourists visiting the region.

3.2Recentdevelopments

Faced with a loss of much of its traditional transatlantic traffic base, Shannon has sought in recent years to increase its passenger numbers in various ways including through the introduction of low-cost services with Ryanair, and has also established itself, with some success, as a transit stop for US military flights, especially those en route to and from the Middle East. The resultant passenger flows in recent years are illustrated in Figure 1 below.

0

500,000

2002 2003 2004 2005 2006 2007

YEARPASSENGERS2008 2009 2010 2011

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000Transit Domestic Transatlantic Europe UK

PASSENGER NUMBERS 2002-2011

Figure 1: Shannon Airport passenger traffic development 2002-2011


The precipitous drop in passenger traffic in 2010 following Ryanair’s withdrawal demonstrated the airport’s vulnerability to decisions by individual carriers in the absence of a broader traffic base.

3.3Boozreport

The State Airports Act of 2004 provided for the separation of the three State Airports, Dublin, Cork and Shannon. In 2008 this decision was further deferred to 2011 by the then Minister for Transport.

In preparation for a final decision on the best way forward, the Minister of Transport, Tourism and Sport in 2011 commissioned a report from Booz & Co. to evaluate the potential for separating both Shannon and Cork Airports from the DAA and the preferred structure for such autonomous entities.

The Booz Report was issued in December 2011. The report analyses the operation of the State Airports and evaluates alternative models of ownership and management. Analysing the airport’s potential profitability based on projected outgoings including service of the existing debt, the report concludes, “the viability of the [Shannon Airport] business cannot be justified through passenger growth only”1. It also proposes “new sources of revenue should be explored including exploitation of land banks, exploration of cargo business potential and improved leverage and expansion of the US pre-clearance facilities to include cargo.”

The report further observes that “the airport lacks sufficient integration with the surrounding industrial land bank, with current management having no function in developing alternative ventures within a mixed aero-industrial complex” and concludes that unless there is a change in strategic direction, the airport will continue to require subsidies from the DAA.

The Booz report’s authors further observe that “the evidence suggests that separation from the existing DAA structure and organising Cork and Shannon airports into functioning local airports authorities with an independent management will improve the airports’ growth prospects, operating performance and overall accountability.”

The Booz report ultimately concludes that full separation from the DAA would offer the greatest opportunities for developing additional business opportunities, which would be further enhanced if the Government were to better integrate the airport with the surrounding industrial developments, in particular the Shannon Free Zone. Such a move would obviate the requirement for ongoing financial support.

3.4TaskForcemethodologyandphilosophy

The Aviation Business Development Task Force has been guided by a desire not merely to deliver a set of proposals or leave behind a set of recommendations.

The Task Force has taken the view that simply documenting ideas and making recommendations is insufficient and that there is an urgent need to do as much as possible in the course of its work to turn ideas into value.

Accordingly the Task Force has sought, to the extent possible, to validate, develop, and progress and add momentum to those proposals in the course of its work.

The group has done so by:

• Engaging with relevant key decision makers (CEO/COO level)

• Identifying enablers and potential roadblocks

• Highlighting issues and addressing and clearing obstacles en route where possible to build momentum

The Task Force has taken the view that the development of a successful new entity at Shannon is a relay, not a sprint; its goal, as part of its execution of its terms of reference, is to make concrete progress with identified opportunities, even where the finish line is inevitably well beyond the horizon of the Task Force.

3.5Stakeholders

The Task Force and its members have consulted with over one hundred stakeholders, in Ireland and abroad, as part of the process of preparing this report.

1 Booz & Co., “Options for the Future Ownership and Operation of Cork and Shannon Airports”, prepared for Department of Transport, Tourism and Sport, Dublin, December 2011

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4 TheGlobalAviationIndustry

4.1Overview

Over the last 40 years, during which the main world economies have grown three to four-fold, the number of air passengers has risen tenfold and cargo volumes have grown by a factor of 14, despite repeated shocks from recessions, terrorism and disease.

The unit cost of air transport has more than halved over this period, through improvements in technology, business processes and asset utilisation. Airlines are forecast to carry approximately 2.8 billion passengers in 2012 with consistent growth of 4-5% per year forecast for at least the next five years. This sustained growth brings both challenges and opportunities for all sectors of the aviation industry.

The airline industry is one in which indigenous Irish businesses have developed significant global positions. Ireland is one of the largest worldwide centres for aircraft leasing and registration. Ryanair is not only one of the world’s largest airlines in terms of passenger numbers, but an industry innovator in terms of operational practices.

Airlines worldwide currently operate a total of about 22,000 aircraft, while it is estimated2 that an average of 1,350 aircraft (100 seats and over) will be delivered each year between now and 2030.

At the same time as these new aircraft are being delivered, an average of 485 aircraft per year will be retired worldwide3. The majority of these will be parted out, in other words dismantled, in order that their components can be reused. Roughly 110 aircraft per year will be converted from passenger to freighter service, a specialist activity with considerable potential.

This large net increase in the worldwide aircraft fleet over the next 20 years, combined with retirement of many of today’s pilots and aircraft engineers, will create a huge and as yet unsolved need for newly trained and skilled employees. It is forecast4 that almost half a million pilots alone will be needed worldwide over the next two decades, and existing training infrastructure is entirely inadequate to meet this need. In addition to pilots, there is a need for trained engineers and other specialist staff. The availability of trained staff, and ultimately of the

capability to train them, will be one of the principal limiting factors to the growth of the aviation industry in the coming decades.

4.2Keyindustrydevelopments

4.2.1 Aircraft leasing

The commercial aircraft leasing market is a huge and growing part of the aviation industry. It has been estimated that in 2010, aircraft lessors had over 7,500 aircraft on lease, almost 36% of the world fleet5. This share is projected to climb to 50% or more within ten years.

The leasing business is already well established in Ireland thanks in large part to the attractiveness to leasing companies of the IFSC-inspired fiscal and business environment. Former employees of GPA Group plc, an early Irish aircraft lessor, have since progressed as both founders and managers of a range of aircraft leasing companies, and in conjunction with the IFSC have contributed to the dominant position that Ireland has historically enjoyed in this sector. Over 30 commercial aircraft lessors currently have a presence in Ireland.

However, the mobile nature of the assets involved, the move towards fiscal harmonisation within the EU, and the entry of new industry players, many of them Asian, means that the continuation of Ireland’s dominant position cannot be taken for granted. Indeed, aggressive competition both from Asian countries and from other EU member states such as Malta place Ireland’s continuing pre-eminence in this sector at risk unless concerted steps to remain competitive are taken. These steps involve both preserving the competitiveness that attracted leasing companies to Ireland in the first place, and developing additional support capabilities, which will serve to anchor their activities more firmly in Ireland. The area of lease transition, described in more detail in Section 5.3.2 below, has been identified as a key “anchor” service for lessors and one that Shannon is particularly well equipped to provide.

4.2.2 Legacy airlines and low-cost carriers

The airline business is central to modern economic life. The airlines that have most successfully delivered shareholder value in recent decades have for the most part been Low Cost Carriers (LCCs). They

2 Airbus Global Market Forecast, 2011-2030

3 ibid.

4 Boeing Commercial Airplanes, Current Market Outlook 2012-2031

5 Boeing/Airclaims data cited by Centre for Asia Pacific Aviation, 17 July 2012


have simplified their fleets, business processes and customer offerings in order to achieve radically lower cost bases than their “legacy” contemporaries. Their lower cost bases have allowed them to offer much lower average fares, stimulating additional traffic and reinforcing their competitive position.

Southwest Airlines in the United States is frequently cited as a pioneer of low-cost airline service. Ryanair was founded in Ireland in 1985 and after an unsuccessful foray into full-service operations it initially remodelled itself on Southwest. However, Ryanair has subsequently extended its aggressively low-cost model far beyond Southwest’s business ethos. Ryanair has in turn served as the prototype for a large range of LCCs all over the world.

Although LCCs continue to grow rapidly, the point-to-point (non-connecting) services offered by typical low-cost carriers are not suitable for all passenger needs. Network carriers offer passengers the ability to book connecting flights through hub airports, and this hub connectivity is also important.

4.2.3 The bilateral system, traffic rights and Open Skies

International air service is regulated by the Chicago Convention of 1944. This created the International Civil Aviation Organisation (ICAO) and established the system of “traffic rights” which airlines must obtain in order to operate international scheduled service. Although restrictions on international flights within Europe and between Europe and the USA have been liberalised in recent decades, under “Open Skies” agreements, much international air traffic is still regulated by bilateral Air Services Agreements between countries. Such bilateral agreements may be highly restrictive, to the extent that they can specify how many carriers from each side may fly between the countries, how many times they may fly per week, and whether their fares have to be approved by government authorities.

A fundamental part of the bilateral traffic rights system is the existence of “Freedoms of the Air”, or permission to operate particular types of service. The first four “freedoms” are standard in all bilateral agreements and relate to the right for an airline of Country A to overfly Country B, land there for technical (refuelling) purposes, or land to pick up

or drop off passengers there. The “fifth freedom” rights allow an airline from Country A to transport passengers between Country B and Country C, i.e. outside the airline’s own country. Fifth-freedom rights are of particular relevance for Shannon, and Irish bilateral agreements have on occasion accorded more liberal fifth-freedom rights in respect of Shannon than of Dublin. It was under fifth-freedom rights, for example, that Aeroflot was entitled to carry passengers between Shannon and Cuba in the 1970s and 1980s.

4.2.4 Air cargo

Air cargo has developed greatly in recent years, as an increasingly globalised world demands faster shipments of consumer and industrial goods from distant countries. The performance of the sector is strongly correlated with global and regional GDP growth and the recent recession has seen considerable retrenchment among air cargo operators. The steady increase in fuel prices in recent years has pushed mainstream operators away from older, less fuel-efficient aircraft towards more modern freighters with lower operating costs.

In 2010, approximately 60,000 tonnes of exports left Ireland via air cargo, and the same weight of imports arrived by air cargo, for a total air cargo tonnage of about 120,000 tonnes.6 (This figure is likely to understate exports quite considerably, since much airfreight leaves Ireland by truck en route to UK airports and is thus not recorded as “air freight” in Irish statistics.) Dublin Airport accounts for over 90% of current Irish air freight, but there is an opportunity for Shannon to develop its offer in this respect, capitalising on its long runway and freedom from congestion and curfews to serve, in particular, the export needs of the pharmaceutical and medical-device industry.

4.2.5 New aircraft types and manufacturing techniques

The aircraft that make up the majority of airline fleets today are of surprisingly old design. The Boeing 737, of which circa 9,000 have been built and which will likely remain in production at least to 2025, first entered service in 1968 based on manufacturing technology, materials and design elements from the Boeing 707, which first flew in 1957. The Airbus A320 entered service in 1988 as a more modern

6 CSO statistics cited in “All-Ireland Airfreight Study”, Irish Exporters Association, Dublin, September 2012

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clean-sheet design, but its construction is still based on traditional aerospace materials such as aluminium alloys.

More recently, Airbus and Boeing have been developing newer-generation aircraft that make more extensive use of structures built with composite materials (e.g. fibre-reinforced plastic). These materials are much lighter than metal alloys, so the new generation of airliners such as the Boeing 787 and Airbus A350 will have much better performance (fuel consumption and range) than their predecessors. However, composite materials require entirely different processes and equipment for manufacturing and repair. These specialist skills are not yet widely available and will be in increasing demand over the coming years.

4.2.6 Projected airline industry growth and resulting resource needs

The impending shortage of qualified flight crew and engineers has already been noted. The average annual airline demand worldwide for the next 20 years is estimated at 22,500 new pilots and 28,000 new mechanics, both to replace those retiring and to cope with growth in the global airline fleet7. This represents 448,000 new pilots over twenty years, and more than half a million new maintenance engineers. Europe alone will need 97,000 pilots and 70,000 mechanics; Asia Pacific will need over 180,000.

Existing training infrastructure is not able to cope with this increased demand. A solution will require not merely new training facilities but also new methods of training. Training providers will not only have to develop these facilities and methods but also win approval from their regulatory authorities.

7 Boeing Commercial Airplanes, Current Market Outlook 2012-2031


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5 AviationBusinessatShannon

One of the Booz report recommendations was the amalgamation of Shannon Airport with the adjacent Shannon Free Zone to enable the autonomous development of an aviation industrial park. The Task Force concurs with this recommendation.

The International Aviation Services Centre (IASC) would be a vibrant and growing cluster of diverse, international, primarily aviation-related businesses built around the airfield and its surrounding lands, providing skilled employment as well as training and education opportunities.

Shannon’s current status is uncertain and the existing uncertainty needs to be eliminated. In order to enable the development of air traffic and new aviation business without delay, the Task Force recommends a phased approach to the creation of the new Shannon entity, with the airport separation followed later by the merger of a restructured Shannon Development into the new Shannon entity.

5.1ExistingaviationbusinessesatShannon

The proposal to develop an international aviation cluster at Shannon would not start from a zero base, but could draw on an existing, vibrant, broad-based group of aviation companies already active in the region. Roughly 40 firms already employ 1600 staff in aviation-related activities in the area, with a particular focus on maintenance and on leasing alongside the operations of the airport itself.

Much of this activity is located in the Shannon Free Zone, whose development began in 1959. While the companies in the SFZ cover many industry sectors, aviation and aviation-related services represent one of the largest single sectors.

Aircraft and engine maintenance represents one principal activity of the existing Shannon aerospace cluster. Significant maintenance providers in Shannon today include Shannon Aerospace, Transaero Engineering, and Eirtech, who already account for approximately half of Shannon’s aviation employment. Along with Lufthansa Technik Turbine Support, which employs over 200 staff on specialised engine maintenance, these companies represent the existing “anchor tenants” for any expansion.

Shannon enjoys unique strengths which are lacking in many existing aviation clusters worldwide, most notably its strong linkage with the aircraft leasing industry and its ability to build on existing capabilities to offer services of particular interest to aircraft

lessors. Several large aircraft lessors, most notably GECAS, the world’s largest, have international bases in Shannon, and the integration of the lessors into the local aviation community has been an essential driver of Shannon’s current activity.

Other Shannon-based firms are active in diverse aspects of aviation such as corporate and private aviation support, aviation training, and logistics and freight forwarding, all of which are identified growth areas for a future international cluster. There are currently three principal strands of activity: airport operations, aircraft and engine maintenance, and aviation equipment leasing and financial services.

Combined with Shannon’s other core assets, namely its long runway and its extensive land bank, these advantages form a solid basis on which additional aviation business opportunities can be developed to create an international aviation centre of excellence.

Recommendation 1

Announce separation without delay and formally separate Shannon Airport from DAA by 31 December 2012.

Recommendation 2

Adopt a phased process to enable the resolution of Shannon Development restructuring issues, with airport separation occurring by year-end 2012 followed by the merger with a restructured Shannon Development on 1 July 2013.


Recommendation 3

Establish the new entity and recruit a CEO.

Recommendation 4

Reconstitute the Shannon Airport Authority board without delay.

5.2InternationalAirport

5.2.1 Existing operations

Shannon’s current passenger level of 1.5 million passengers (2012) is not sustainable. The terminal has a design capacity of 4.5 million passengers, so there is considerable scope to increase passenger numbers within the existing terminal infrastructure.

5.2.1.1Preclearance

Shannon’s US Customs and Border Preclearance (CBP) facility for passengers en route to the United States is a strong selling point, especially for transit traffic (see below), as Shannon and Dublin are currently the only locations outside the Americas to benefit from this facility. However, the proposal to provide US CBP facilities in Abu Dhabi, along with the proposed US legislation allowing foreign governments to pay the costs of CBP services, suggests that more overseas CBP facilities may appear in the coming years, potentially diluting Ireland’s current advantage in this respect.

5.2.1.2Militaryoperations

Shannon continues to serve as a transit stop for United States military flights, in particular those operated by US commercial airlines carrying troops to and from the Middle East. The reduction of US troop numbers in Iraq and Afghanistan has led to a corresponding reduction in these movements. It is however anticipated that the United States will continue to have a certain ongoing requirement to transfer troops to and from permanent bases in the Middle East. A refuelling stop is necessary en route, and Shannon competes with other European airports such as Leipzig for this business. The Shannon Airport commercial team has been lobbying for the extension of US CBP to US military passengers returning to the United States, to provide a stronger differentiator for Shannon as a transit point relative to other European airports.

5.2.1.3Designateddiversionairfield

Shannon is unique among the state airports in being open 24 hours per day, 365 days per year, as befits its status as a common diversion airport for aircraft encountering technical or medical emergencies over the Atlantic. This status also dictates the maintenance of an around-the-clock airport rescue and firefighting service. These opening hours impose an additional cost burden. Actual diversions are relatively infrequent and do not materially defray the costs of round-the-clock operation. However, the US military transit flights do make use of the extended opening hours.

Recommendation 5

Shannon Airport management should keep under review from an overall cost benefit perspective the specific costs and revenues associated with 24/7/365 operation, over and above operation in normal commercial hours.

5.2.2 Potential for Airport Operations

Shannon has considerable potential to develop its air traffic, in terms of both short-haul scheduled services and also long-haul and transit operations.

The airport has historically been constrained in terms of the incentive deals it can offer by the fact that the DAA adopts a uniform structure across all three State airports in the DAA Group. As an autonomous entity, Shannon Airport will have the ability to structure incentive deals for new service which correspond better to the airport’s particular characteristics and market.

Airports are under increasing pressure from airlines to offer highly competitive commercial terms. Airlines are increasingly influenced by airport charges in their new route decisions, and for Shannon Airport to attract significant additional traffic, it will have to be able to offer a highly competitive charging structure to airlines. This in turn underlines the importance for the airport of being competitive in terms of its cost base.

A newly autonomous Shannon Airport should seek to differentiate itself from the DAA rather than following DAA processes and business practices by default. In order to maximise passenger numbers, Shannon needs not only to develop its route network but also to ensure that it offers an attractive customer experience to its passengers in comparison with its

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competing airports, which are principally the DAA airports at Dublin and Cork. Similarly, Shannon Airport should evaluate the business processes that it inherits from the DAA to establish whether they are all appropriate and optimised for an autonomous airport entity.

Recommendation 6

Shannon Airport should evaluate ways to differentiate itself positively from competing airports in the eyes of its passengers and potential passengers.

Recommendation 7

Shannon Airport should evaluate its business processes and practices for their appropriateness and where needed should develop new processes tailored to its new requirements with a focus on productivity and competitiveness.

One of the significant changes in airport commercial operations in recent decades has been the increase in “non-aeronautical” revenues. This is the revenue generated from retail sales in the airport terminal (including duty-free where applicable), from car parking, and from food and beverage concessions. Shannon was a pioneer in this area, having established the world’s first duty-free shop, and this know-how subsequently formed the basis for a successful international consultancy and management business in the form of Aer Rianta International.

More recently, commercial pressures on airports, especially but not exclusively driven by the aggressive commercial practices of low-cost carriers, have compelled airport management to place much more emphasis on commercial revenue generation. This is an area where Shannon can refine and develop its current offer in order to generate more revenue per passenger. In this context, additional passengers, even if they contribute little in terms of aeronautical charges, are a valuable source of extra commercial revenue: all airports are having to focus on maximising their non-aeronautical revenue generation capability. With low-cost carriers leading the way, airlines are far more demanding in seeking lower airport costs, and this imposes considerable cost-control and commercial-revenue pressures on airports, particularly those airports which do not serve a large urban catchment area and which have to rely on attractive aeronautical charges to attract carriers.

Low-cost airlines have been particularly strict in limiting passengers’ hand baggage to a single bag, often insisting that any purchases made in airport shops must fit within this one bag. This “one bag rule” has in many cases restricted airports’ ability to grow their commercial revenue, as passengers seek to avoid excess baggage charges. It will be important for Shannon to seek a relaxation of this rule from its airline customers to enable it to offer competitive aeronautical charges.

Recommendation 8

Shannon should keep its commercial revenue strategy and commercial unit revenues under review with a view to learning from best practice and considerably enhancing commercial revenue and overall profit per passenger.

The Task Force notes that the Business Plan projects 2.3 million passengers within five years and 2.5 million passengers by 2021. It is the view of the Task Force that these targets are entirely achievable, potentially even earlier than provided for in the business plan. In conjunction with continuing cost control and an improvement in commercial revenue per passenger, attainment of the business plan passenger targets would bring the airport’s operation to sustainability. The Task Force notes that the achievement of this level of increased passenger traffic will require the airport to be able to offer a competitive charging structure to airlines.

Recommendation 9

Shannon should seek to attract additional short-haul traffic and revenue through appropriate incentive deals.

A number of discussions are ongoing with carriers, which if successful have the potential to increase passenger numbers appreciably and to enlarge the range of destinations served from Shannon. Clarity regarding the future of Shannon Airport is required by all of the airlines and in the vast majority of cases, the completion of these discussions is contingent on separation.

The transatlantic market was the original raison d’être of Shannon Airport and remains a core element of its operation. Shannon’s attractiveness to carriers serving the North American market is underscored by the recent announcement by United Airlines of a Chicago-Shannon service in Summer 2013.


Aer Lingus has chosen to concentrate the majority of its transatlantic operations on Dublin, to the detriment of Shannon. However, from 2016-2017, the arrival in the marketplace of new smaller aircraft types capable of flying transatlantic routes (such as the A320NEO and A321NEO), in which Aer Lingus has expressed an interest, may open up further opportunities for more frequent service from Shannon.

In the meantime, there exist further opportunities to develop long-haul traffic at Shannon. US carriers are now beginning to receive deliveries of the much-delayed Boeing 787, freeing up other aircraft to develop new routes. Although overall capacity growth on the North Atlantic is modest, carriers are continuing to add new seasonal and year-round routes. Airline planners will be encouraged in this respect by Shannon’s enhanced profile and by the demonstrable evidence of a commitment to reverse its traffic decline and rebuild its passenger numbers.

Recommendation 10

Shannon should continue to develop its long-haul terminal traffic, chiefly in the North American market.

Historically, Shannon benefitted greatly from its role as a transit stop for Aeroflot flights between Moscow and the Americas. Aeroflot also had the ability to carry Irish passengers between Ireland and Cuba, thanks to fifth-freedom rights, i.e. the rights for an airline of one country to carry passengers between two other countries.

Ireland is currently a signatory to bilateral air services agreements with a range of non-EU countries. In many cases these agreements provide for the award of fifth-freedom rights to overseas carriers in respect of services through points in Ireland. However, this generally requires the agreement of both parties to the bilateral agreement.

Subject to the approval of the Irish authorities, therefore, certain non-EU carriers could use Shannon as a transit and commercial stopover point where this is permitted under the relevant bilateral agreement.

Combined with Shannon’s US Preclearance facilities, this forms an attractive selling point for a range of Russian, Middle Eastern, Asian and African carriers wishing to serve North America and pick

up additional revenue. Transaero management has already been quoted in the media as expressing interest in this opportunity. Discussions are currently ongoing with several other carriers, both passenger and cargo, who have expressed specific interest in exploring the potential for fifth-freedom service through Shannon, and several other airlines have been identified for discussions on this prospect.

There are several attractive aspects to the use of Shannon as a fifth-freedom transit point en route to the United States. Airlines from Africa, the Middle East and South Asia may lack aircraft able to reach North America non-stop and may therefore have to stop for refuelling en route. The use of Shannon not only permits their passengers to clear United States customs and immigration but also gives the airlines the opportunity of generating additional passenger and cargo revenue by serving unmet demand for direct services between Ireland and points in the United States.

It is the view of the Task Force that such services have the potential to complement rather than compete with the existing and potential operations of US and Irish carriers.

Recommendation 11

Shannon should draw on the Department of Transport, Tourism and Sport’s willingness to negotiate new Irish bilateral Air Services Agreements, and to include fifth-freedom rights, in order to develop additional long-haul airline service opportunities.

Recommendation 12

Shannon should aggressively market existing fifth-freedom opportunities for long-haul transit traffic.

Shannon Airport is a major gateway for inbound tourists to the West of Ireland, and it is vital that the airport can maintain and preserve this role. This is linked not only to the availability of appropriate air services (discussed above) but also to the attractiveness of the tourism offer in the region.

The tourism industry has been identified by the Government as a critical driver of economic recovery. Tourism is especially important to the outlook for economic growth and employment in the West of Ireland. Tourism is a labour-intensive industry, providing more than one out of each ten jobs

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in Ireland. These jobs are spread across a wide geographical area, with seven out of each ten jobs in tourism located outside of Dublin.

A revitalised Shannon Airport is of critical importance to the tourism sector not just in the Mid-West region but along the entire Western Seaboard. Although the overall number of visitors to Ireland from overseas rose 8% in 2011 from a year earlier, the West of Ireland has underperformed. Under the business plan for Shannon Airport, passenger numbers will increase from 1.5 million in 2012 to 2.3 million within five years, including a substantial gain in overseas visitors. With spending by domestic tourists likely to remain constrained by pressures on disposable income at home, this anticipated increase in overseas visitor numbers is crucial for recovery in the tourism industry and the broader economy in the West of Ireland.

The nature of tourism itself is changing: factors such as changing demographics, the advent of low-cost airline travel, and the growth of the internet and social media mean that the characteristics, behaviours and expectations of tourists are evolving8. Critical to this recovery, therefore, will be improved competitiveness by tourism-related businesses brought about by innovation (that is, the development of new products and services). This will enable a better overall offering for tourists to boost demand, and will reduce costs.

An independent Shannon Airport will provide a boost to the tourism industry. At the same time, passenger numbers at Shannon Airport will benefit from a recovery in demand for tourism products in the West of Ireland.

5.2.2.1Cargo

The majority of cargo that arrives or leaves Ireland by air today does so via Dublin Airport. Due to the current inadequacy of Irish air cargo facilities and air cargo routes a large proportion of Irish-originating “air cargo” is in fact transported by truck across the Irish Sea to a UK airport and transported as air freight from there. This lack of appropriate air cargo infrastructure represents something of a hindrance to Irish export competitiveness. In particular, the lack of adequate temperature-controlled (“cold-chain”) facilities

is an impediment to the time-efficient export of many high-value pharmaceuticals. A recent study9 asserts, “at present cold chain facilities in Ireland are very limited and interviewees indicate that substantial business will be lost as a result.” Conversely, the provision of appropriate cargo infrastructure would allow the further development of export markets, for example for fresh foodstuffs such as seafood which are increasingly sought-after in regions such as East Asia: “freight forwarders are becoming very bullish about the prospects for Irish fish exports, some saying that, with proper organisation, the sector could easily support a weekly freighter service.”10

Especially in the context of pharmaceutical exports, United States Food and Drug Administration (FDA) approval is seen as a significant positive element, which can improve the competitiveness of a cargo facility and of the pharmaceutical industry in Ireland.11

Notwithstanding the image of air cargo as being the preserve of dedicated freighter aircraft, it is important to note that the majority of international air cargo still travels in the holds of passenger aircraft. Cargo is a major contributor to airline revenue, in particular on long-haul operations (since the wide-body aircraft used for most long-haul flying have proportionally more cargo space available). The availability of appropriate airport cargo facilities can therefore assist an airport in attracting new long-haul passenger services, by improving the route revenue potential from the airline’s viewpoint.

It is the view of the Task Force that Shannon cannot at this time realistically aspire to being a pan-European cargo hub such as Cologne, Leipzig or Liège, but can successfully serve a more focused role. The airport’s road freight catchment is far less than continental European hubs but it can credibly aspire to providing cargo services for much of Ireland and improving the competitiveness of major Irish export sectors.

The Business Plan has made provision for capital expenditure on the necessary enabling infrastructure for a cargo terminal.

8 Deegan, J.:“Benchmarking Innovation in Irish Tourism,” Fáilte Ireland thematic grant project, 2012

9 “All-Ireland Airfreight Study”, Irish Exporters Association, Dublin, September 2012

10 ibid.

11 ibid.


Recommendation 13

Update and validate business case for constructing a modern cargo terminal with cold-chain capability at Shannon, preferably in partnership with a specialist company.

Recommendation 14

A focused and targeted marketing campaign to key cargo carriers should be undertaken by the new entity.

5.3Maintenance,RepairandOverhaul(MRO)

5.3.1 General

The global aircraft MRO (Maintenance Repair and Overhaul) market is forecast to grow from roughly $41.5 billion in 2010 to about $50.8 billion in 2014, a CAGR of 5.2%12. Geographically, North America and Europe will remain the largest MRO markets, representing over 57% of the total market in 2014 (down from 62% in 2011).

Although developing-country MRO facilities are growing rapidly and offer a labour-cost advantage over European and North American operators, they have still not reached equivalent levels of quality and consistency. Further, while labour plays a significant role in “basic” airframe heavy maintenance costs, it is a less dominant component in specialist engine or component maintenance activity. Additionally, as noted below, there is a trend for MRO organisations to align themselves with the major aircraft and engine manufacturers, also known as OEMs (Original Equipment Manufacturers). These factors mean that developed-country MROs can continue to be competitive against low-labour-cost economies, as long as they target their efforts appropriately.

Over the past five to ten years, commercial aviation OEMs (predominantly engine and component manufacturers) have worked to strengthen their position in the aftermarket. Boeing’s “GoldCare” offering is an example of a manufacturer seeking to “lock in” the MRO activity for its aircraft. Given OEMs’ growing strength, many MROs are more closely aligning themselves with OEMs, not only

to grow revenues but also to ensure their future presence in the aftermarket, and this could be a logical step for a Shannon-based MRO.

Over time, this alignment and consolidation is likely to lead to fewer bigger OEMs.

The primary concerns for aircraft operators choosing a maintenance facility are downtime, quality and cost. Reputation and cost-effectiveness are key in the MRO business and a dependable, flexible operator will ultimately win business in preference to a maintenance facility whose quality or reliability levels are inferior. Airlines and other aircraft owners are increasingly seeking to consolidate their supply chains and to work with smaller numbers of service providers.

The above factors influence aircraft operators’ choice of MRO facilities, but what factors have previously influenced the MRO providers in their choice of location for their facilities? They typically consider market access, proximity to major customers, and availability of appropriate staff, but the primary driver is however the need for a favourable cost base. MRO providers compete for business on other factors as well as price, so competitive input costs are a necessary but not sufficient precondition for market success.

5.3.2 Lease transition

An average narrow-body airliner changes operator four times during its life. The work that is needed to refurbish an aircraft, to verify its repair and documentation status, and to complete any outstanding repairs needed, can take anything from one to two months. A number of large MRO organisations offer a dedicated service to facilitate the transition of an aircraft between operators, along with all necessary records verification, and technical checks and modifications. However, lessors expect high levels of flexibility and adaptability from the companies carrying out lease transitions, and not all providers are able to provide the requisite flexibility. Especially for non-routine maintenance activities such as lease transition, the ability of the maintenance provider to adapt to any unforeseen difficulties and to return the aircraft to its operator on the contracted day is paramount. Given the variety of tasks associated with a lease transition,

12 “MRO Industry Landscape 2011”, Oliver Wyman survey

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from airframe and engine maintenance to technical records checking, cabin reconfiguration and exterior painting, the availability of a “one-stop shop” service, ideally associated with parking facilities for aircraft storage, is particularly attractive to a lessor. This “one stop shop” can be provided by a single provider or by a group of co-operating providers in the same location, an example of how the cluster effect envisaged for Shannon can concretely improve the competitiveness of Shannon-based companies.

Given the trend for OEMs to exercise more control over the full life of their aircraft, the opportunity for OEM-approved transition management facilities is a significant one. Small and medium airlines typically lack the know-how to manage an aircraft transition effectively.

Discussion with key lessors and MRO providers allowed the Task Force to gain an appreciation of the factors influencing a choice of lease transition location. The actual transition process can at times be relatively complex and has the potential to throw up unforeseen complications, which must be rectified with little or no impact on the committed aircraft redelivery date, imposing a very high burden of flexibility on the maintenance provider. As noted above, from the point of view of the lessors who are contracting for these services, reliability and cost are critical.

5.3.3 Parting out

Currently approximately 450 commercial aircraft are “parted out” or recycled (dismantled for reusable spare parts) worldwide each year13, a number which is likely to rise as older types are withdrawn from service due to sustained high fuel prices.

Aircraft recycling is an environmentally friendly, and increasingly lucrative, business. Approximately 80% of an Airbus A320 can be reused in the marketplace, due to the ongoing popularity of the aircraft along with its modern design. The longevity of the A320 family suggests a profitable ongoing business opportunity for parting out older aircraft of this type. The sector’s trade body, the Aircraft Fleet Recycling Association, is targeting 90% recyclability of Airbus A320s by 2016.

More cost-effective parting-out can raise the residual value of older aircraft (as their sale value for parting

out will grow), thus contributing to taking older aircraft (usually available at relatively low lease rates) out of the worldwide fleet. This will be of benefit to airlines and lessors alike.

The need to carefully document the provenance of aircraft spare parts, as well as the requirement to comply with increasingly strict waste disposal regulations, makes the business a specialist one, but with strong growth and employment prospects. Parting out companies are becoming more sophisticated due to tighter regulations but most such firms are still relatively small in scale. There is an opportunity to build a larger-scale facility, potentially in partnership with a major fleet owner (such as a lessor) or one or more major OEMs, all of whom are becoming increasingly involved in this area. Through stakeholder discussions, the Task Force has been able to confirm the market opportunities that exist in this sector.

5.3.4 Designated Aircraft Parking

Aircraft lessors periodically have occasion to repossess their aircraft, typically due to airline default. Additionally, the routine management of a lease portfolio may necessitate parking aircraft from time to time, whether for a shorter or longer period. In such cases, which are effectively unplanned lease transitions, the aircraft need to be stored, typically for weeks or months, until a new lessee can be found for them. During this time transition checks and sometimes remedial work must be carried out and ultimately the aircraft must be adapted to the new operator’s requirements and painted in their livery.

The presence of reasonably priced dedicated long-term aircraft parking is a key determinant of where the lessor will locate the aircraft during this time. Flying the aircraft elsewhere for maintenance is costly, so, all else being equal, lessors will have a preference to carry out maintenance and transition work wherever the aircraft is parked. The provision of ample dedicated aircraft parking space at attractive rates is therefore an effective means of attracting additional maintenance and transition activity. This has been verified through discussions with major aircraft lessors.

13 Boeing presentation at 2010 annual meeting of Aircraft Fleet Recycling Association


5.3.5 Continuing Airworthiness

The term “Continuing Airworthiness” refers to the maintenance of all technical records and approvals necessary for the ongoing operation of an aircraft. The level of regulation to which the aviation industry is subject, and which is to a large extent responsible for the industry’s excellent safety record, nonetheless imposes a heavy burden of technical documentation. There is an emerging opportunity for airlines to outsource the management of their technical documentation to a third-party provider with the appropriate regulatory approval to operate as a Continuing Airworthiness Management Operator or CAMO. Such providers are typically MRO organisations who can draw on their in-house technical skills to offer a cost-effective solution for third-party clients. Provision of CAMO services therefore represents a logical and potentially lucrative extension of activity for MRO providers.

5.3.6 Opportunities for Shannon

While the labour cost component of routine maintenance is relatively high, successful Irish MRO providers have demonstrated that Ireland can compete effectively in this space through flexible working arrangements and strict control of input costs. Ireland enjoys an even stronger comparative advantage in high-value, non-routine and bespoke work requiring a high degree of flexibility and dependability. In discussions with lessors the Task Force has confirmed that the lessors are strongly attracted by the prospect of a dependable and competitive “one-stop shop” service for lease transitions.

The Task Force has formed the view that the immediate obstacle preventing many Irish-based firms from establishing or expanding operations at Shannon is the non-availability of appropriate infrastructure. This infrastructure includes not only hangars and aircraft parking areas but also teardown pads (special parking areas for aircraft being dismantled). Maintenance providers often do not wish to own their facilities, preferring instead to enter into long leases.

The facilitation of private-sector infrastructure investment is therefore a key enabler to the development of the MRO sector in Shannon, and this is addressed in more detail in Section 8. It is particularly important that any investment incentives be structured to provide cost-effective rental levels for the tenants.

It is envisaged that the construction of hangar infrastructure would not take place on a speculative basis but only when firm tenant interest has been identified.

Five sub-segments are identified which should be targeted as a priority within MRO activities. These have been validated through discussions with relevant stakeholders.

1.Airline-linkedorsupplier-linkedMROfacilities(e.g.TransaeroEngineering)

The existence of a link with a supplier, OEM or major airline customer provides a stability that a fully independent MRO cannot easily achieve. Transaero Engineering benefits from the support of its parent airline: when there is spare capacity in the Shannon facility, Transaero aircraft are sent to Shannon for maintenance rather than to an alternative external facility.

2.Specialisednon-routineMROactivity,forexampleleasetransitions

While all MRO providers have to adapt to their customers’ requirements, non-routine maintenance work in particular requires a high degree of adaptability and flexibility on the part of the maintenance provider. Lease transitions, when an aircraft returns from one airline lessee and has to be prepared to enter service with another, are a case in point. Timescales are frequently tight: the lessor wants to minimise downtime and have the aircraft in operation and earning revenue as quickly as possible. At the same time, the work scope may not be fully known in advance: remedial work may be needed on the aircraft if the previous lessee has not maintained it appropriately, while the cabin is likely to have to be refitted in any case, potentially with complex new seats and/or in-flight entertainment equipment. While an MRO facility is unlikely to focus on lease transition work alone, an ability to offer all the necessary components of lease transition activity (airframe and component maintenance, cabin reconfiguration, and aircraft painting) in one location, with dependable completion dates, is a very attractive offer to lessors and one that cannot be easily replicated in many locations.

3.MROfacilityspecialisedinlesscommonaircrafttypes

The growth in new developing-country maintenance facilities has understandably focused on relatively new aircraft types with extensive order books.

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Older aircraft represent a legacy market and frequently require more intensive maintenance than their modern equivalents. Some older types may have many years of economic life ahead but be constrained by a shortage of approved maintenance facilities.

4.ContinuedAirworthinessManagementOrganisations

As noted above, the coming years are likely to see considerable outsourcing activity as airlines seek to focus on their core business and contract out the management of their aircraft technical documentation to specialist suppliers. Especially in conjunction with technological changes (e.g. digitisation of technical records) there is likely to be a considerable first-mover advantage for firms successfully establishing themselves in this emerging market.

The Task Force has confirmed this opportunity through discussions with companies involved in the sector.

5.CorporateandprivateaircraftMROandcompletioncentre

The business aircraft sector is a fast growing sector. In the context of Ireland’s business-friendly corporate taxation environment and favourable reputation, a focus on business aircraft MRO and completion services is likely to bear fruit, provided that Ireland can effectively position itself as a specifically business-aircraft-friendly jurisdiction (see also Section 5.8 below).

Recommendation 15

Continue to target high-added value MRO and MRO-related activities: lease transition, CAMO/technical document support.

Recommendation 16

Develop plan to roll out hangars and other infrastructure rapidly in response to specific tenant demand.

Recommendation 17

Develop plan for dedicated parking, and explore potential for entering into “preferred supplier” contracts with lessors and airlines for parking.

Recommendation 18

Work to attract a design or completion centre for a non-European aircraft manufacturer targeting the European market.

5.4Pilottraining

5.4.1 Industry requirements

As noted in section 4.2.6 above, the industry will need large numbers of trained flight crew and maintenance engineers over the next 20 years, but there is as yet no credible path in place to produce the required number of qualified staff.

The creation of a training infrastructure that can meet this demand in time is a huge challenge for the industry. The addition of large numbers of new aircraft to the worldwide fleet will require more efficient training and delivery methods, including web-based learning, paperless curricula, and strategically located training facilities. Training will also have to be tailored to the new technologies available on new generation aircraft such as the 787 and A350.

Few airlines still invest in ab initio training. The way forward for cost-effective pilot training is likely to be the new Multi-Crew Pilot Licence (MPL) syllabus, but no schools have yet been built “from the ground up” around this radical and time-saving curriculum. This is a potential opportunity for Shannon.

Similarly, the huge demand for maintenance personnel will create a need for innovative training methods that are both relevant and more efficient than the current approaches.

5.4.2 Training syllabus evolution: MPL

The Multi-crew pilot license (MPL) was developed to enhance training quality and improve safety in civil aviation. The MPL syllabus, published in 2006, is a radically new approach, which focuses on the end goal of training a safe, competent airline pilot for a career on a multi-crew flight deck.

Whereas conventional pilot training programmes rely extensively on hours spent flying light aircraft (and thus require good weather), the MPL makes much more extensive use of modern simulators and is thus far less weather-dependent.


The overall MPL training process requires a much tighter co-operation between the training provider and the airline, since a significant part of the pilot’s training will be within the airline. This means that training providers’ relationships with airlines will increasingly drive their business.

Despite the advantages of MPL training, it has been slow to become established, in large part through inertia and lack of investment by existing training providers who are wedded to the status quo. An opportunity therefore exists to create the first purpose-built MPL training school and capture significant market share through partnerships with like-minded airlines.

5.4.3 Shannon opportunity

Training providers contacted by the Task Force perceive Shannon as an attractive training location compared to Dublin: both the airfield itself and the surrounding airspace are uncongested and thus more easily able to accommodate training activity. One established international pilot training organisation evaluating Ireland for a new facility stated that if they were to select Shannon, they would base both a ground school and a number of aircraft there, whereas if Dublin were the chosen location, only the ground school would be feasible and the aircraft would be based in another country. The same organisation indicated that the greatest obstacle was the absence of hangar facilities in which they could store and maintain their training aircraft. Recommendation 16 above concerning the financing of MRO hangars therefore also applies here.

Ab initio training where new entrants to the industry are trained as pilots from zero, whether under a conventional syllabus or following the MPL route described in Section 5.4.2 above, may take place in blocks lasting weeks or months. It therefore opens additional opportunities for related economic activity (e.g. accommodation provision) and is also less sensitive to the relative lack of direct and frequent flight connections.

Recurrent and type-conversion training (where currently employed airline pilots are being introduced to a new aircraft type or are having periodic refresher courses), as well as requiring more highly sophisticated simulators, is much shorter in duration

and therefore relies more on the availability of frequent air connections allowing for the scheduling of trainees’ arrivals and departures with minimal downtime.

Recommendation 19

Market Shannon as a location for pilot training organisations focussing on innovative (e.g. MPL) and niche approaches to training delivery (efforts are already underway.

5.5Education,technicaltrainingandconsultancy

5.5.1 Engineers

Forecasts cited earlier14 point to a worldwide need for over 600,000 new aircraft maintenance engineers and technicians over the next 20 years. While the latter part of the training of a licensed aircraft engineer has to take place on the “factory floor” of an MRO facility, there is an opportunity to provide initial technical training in a specialist training facility.

Additionally, an increasing number of technical staff will have to be trained in new aircraft technologies such as the maintenance and repair of composite components, a particular focus for several Shannon organisations.

Apprenticeships form an integral part of the training process for many aviation-related trades, and FÁS/SOLAS is already involved with Shannon-based companies operating apprenticeship schemes. It is anticipated that these schemes will expand over time.

5.5.2 ATC

Other fields of aviation also have a requirement for cost-effectively trained staff. Air Traffic Control is a case in point: the increasing emphasis on raising air safety standards worldwide will in turn increase the requirement for air traffic controllers trained to high and internationally-recognised standards. The IAA is already exploring partnerships with third-level institutions with a view to offering ATC training programmes accredited at European level.

5.5.3 Other aviation-industry staff

There are substantial and diverse opportunities to provide training for a range of other aviation industry

14 Boeing Commercial Airplanes, Commercial Market Outlook 2012-2031

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staff, especially those from developing countries and from countries without a strong aviation history. These can range from English-language courses to specialist courses such as cabin crew training or the training of airport firefighters. A range of Irish SMEs that provide such training to the aviation industry are already grouped under the College Ireland brand, under the aegis of the Irish Aviation Authority. The College Ireland members are currently evaluating the optimal structure for their organisation and the potential for College Ireland or a successor thereto to provide a co-ordination and marketing service for Irish providers of aviation training, with its headquarters in Shannon, is under active consideration.

5.5.4 Third- and fourth-level education

Linkages with third-level educational institutions are a fundamental enabler of IASC’s success, both to provide the Centre with a research resource on which its member companies can draw, and to ensure a pipeline of future talent that will fuel the expansion of the Centre. A number of links already exist between Shannon-based companies and third-level institutes in the region, principally the University of Limerick. Both UL and Limerick Institute of Technology (LIT) already have agreements with a range of aerospace organisations facilitating work placements for their students, and it is the view of the Task Force that such placements provide a powerful and low-cost way to build links between industry and the academy.

The Task Force has identified potential funding sources for Shannon infrastructure, including EIB funding. The Task Force notes that the scope of the EIB scheme under consideration also encompasses academic research infrastructure and suggests that the potential for a dedicated academic aviation/tourism research facility at Shannon be evaluated.

Recommendation 20

Pursue complementary opportunities for technical and ATC training as well as for other aviation-industry education provision.

Recommendation 21

Explore the possibility for College Ireland or a successor body, to be based in Shannon, to provide co-ordination and marketing support for the activities of Irish aviation training SMEs.

Recommendation 22

Target additional industrial placements for local universities with key aerospace companies and OEMs worldwide.

Recommendation 23

Specific academic and training courses focusing on composites should be developed by UL, LIT and other institutions.

Recommendation 24

Explore potential for further dedicated aviation/tourism academic research infrastructure supported by European funding.

Shannon College of Hotel Management has been part of Shannon Airport since 1951. It is a Recognised College of the National University of Ireland (NUI) and has strong educational links with National University of Ireland Galway (NUI Galway) since 1991. In 2004 it was deemed to be a non-core activity of DAA. In 2008 a submission was made to the Higher Education Authority (HEA) recommending the amalgamation of Shannon College with NUI Galway, while retaining its location at Shannon Airport. In 2011 HEA requested submissions from all third-level institutions, outlining their future position within the national higher education system. Amalgamation of Shannon College of Hotel Management with NUI Galway was again recommended in this submission.

This amalgamation is seen as the best fit for the future of Shannon College, positioning it as part of a major university whilst retaining the College in Shannon. It would free Shannon Airport from the administrative burden of running the College and turn it into a positive contributor to Shannon Airport finances.

Recommendation 25

The Department of Education should implement the amalgamation of Shannon College of Hotel Management with NUI Galway as soon as possible.


5.6Aviationsoftwareandsystemsdevelopment

Airline operations are based on processes and systems established in an era of rudimentary telecommunications and data processing technology. As such, they offer many opportunities for innovation.

A wide range of product and service suppliers facilitates the frontline operations of the aviation industry. These suppliers include recruitment and crew-leasing services that enable airlines to meet their resourcing needs more flexibly. They also encompass specialist software and IT solution providers who offer specialist packages and tools. These tools may improve operational efficiency (e.g. aircraft scheduling, maintenance planning, technical records tracking, punctuality data collation and trend monitoring, Electronic Flight Bags). They may enhance airline commercial profitability (revenue management software, mobile-commerce platforms), or they may enable airlines to offer a better customer experience (in-flight entertainment hardware and software).

Although typically much smaller than the airlines and OEMs to whom they supply their wares, these companies contribute greatly to the vitality of the industry. Their need for specialist staff and support resources means that they will be open to locating in a relevant industry cluster; indeed, it will be essential to provide appropriate “incubation space” to allow future generations of aviation-industry suppliers to create their businesses. Software firms may also benefit from the proximity of the headquarters of LERO, the national software engineering centre, in Limerick.

While many aviation-support firms may base the majority of their staff at their head offices, crew-leasing firms are an exception. Such companies provide flight crew to airlines worldwide, typically taking care of recruitment and payroll and offering a flexible resourcing solution to fast-growing carriers which may not be able to source sufficient qualified flight crew locally. In this way, pilots employed on Irish contracts and paying taxes and PRSI in Ireland might be flying for airlines all over the world.

The crew leasing market has considerable scope to develop as the share of air traffic outside the most highly developed markets of Europe and North America continues to grow. Some countries continue to impose nationality restrictions on pilots flying for the country’s airlines; Russia is one such example.

Liberalisation of these restrictions will have the effect of growing the market for pilots and for crew leasing services of the sort that Shannon can logically attract.

Recommendation 26

Pursue software development for the aviation industry as a key sector.

5.7AviationFinance

Many other facets of the aviation industry are also open to innovation; even the basis of the highly profitable and growing leasing industry, the operating lease, has not changed fundamentally in thirty years. Shannon-based entrepreneurs in this sector are currently developing and validating innovative products that could improve the efficiency not only of the leasing market but also of airlines themselves.

United States airlines have the ability to finance their aircraft using a type of aviation-backed bond known as an Enhanced Equipment Trust Certificate (“EETC”) for which an established market exists. EETCs are an aviation-specific form of asset-backed security (secured on the aircraft) that is of interest to institutional investors, in particular because of the security which investors have over the aircraft.

In the case of the United States, this security was provided by full adoption (the “Alternative A” adoption) of the Cape Town Treaty, which sits above local insolvency laws. The full adoption of the treaty allows US borrowers to benefit from a significant discount (known as the “Cape Town Discount”) in their financing costs. Since it is becoming increasingly difficult and expensive to obtain financing, the option for airlines to raise debt in the capital markets is becoming increasingly attractive.

The EETC market has to date focused on the United States but there is a significant opportunity for Ireland to leverage its existing aviation finance knowledge both to open new and cheaper funding sources for Irish airlines and to raise the country’s profile as a centre for aviation finance. The ongoing growth in the number of countries that have fully adopted Cape Town represents an increasing scope for issuing EETCs secured on aircraft operating there, and thus an increasing market for Irish aviation finance.

In addition to the full adoption of the Cape Town treaty, there is strong potential to make Ireland in general, and Shannon in particular, an attractive

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location for EETC issuance. An example of a targeted incentive for such activity would be exemption from withholding tax on payments made under an EETC, which could be limited to IASC companies in a similar way to what was in place for IFSC certified companies.

Recommendation 27

Support innovative projects and research in aviation finance in collaboration with local companies and educational institutions.

Recommendation 28

Ireland should move to full (equivalent to “Alternative A”) adoption of the Cape Town Treaty without delay.

Recommendation 29

Examine the potential for specific incentives to attract international business to issue EETCs in Ireland, for example through a targeted exemption from withholding tax.

5.8Corporateandprivateaviation(businessjets)

Business aircraft represent a steadily growing market: Bombardier, for example, forecasts 10,000 business jet deliveries worldwide, worth $260 billion, in the period from 2011 to 2020, and 14,000 deliveries worth $366 billion in the period from 2021 to 2030.

While these aircraft have in the past been registered in the country in which their owner or operator is based or domiciled, there has been a recent trend towards specialised corporate and private aircraft registries. The Isle of Man established the “M” register in 2007, targeted at business aircraft, and has already registered well in excess of 500 aircraft. Guernsey is currently planning a similar business aircraft registry, while Malta has been aggressively positioning itself as a favourable jurisdiction for aircraft leasing, with particular focus on the registry and administration of corporate and private aircraft. Although Ireland has developed a very strong position in commercial aircraft leasing, the worldwide corporate aircraft market is at risk of bypassing the country entirely.

In each case, the attraction for the registration

jurisdiction in question is not merely the revenue from the registry fees but the spin-off benefits from linking the aircraft of high-net-worth individuals with the location. This encompasses the legal and compliance work involved, maintenance and crewing services, and also the likelihood that the owner will take a greater interest in the location overall. Malta offers a modest number of aircraft MRO providers and hopes to gain some business for these and other aircraft support activities from locally registered aircraft; the Isle of Man and Guernsey have virtually no such supporting industries. Ireland, on the other hand, stands to benefit considerably from potential spinoff business, both through existing support activities and through the corporate-aviation support businesses that could reasonably be developed in Shannon.

The factors that influence the competitiveness of commercial aircraft MRO facilities apply also to business aircraft maintenance providers, with the added specificity that corporate aircraft are typically maintained by specialist companies focusing only on the corporate aviation market. There is relatively little overlap between MRO providers to the commercial and biz-jet markets. The nature of the work undertaken by corporate aircraft maintenance facilities is also very different. Commercial aircraft are delivered by the manufacturer fully equipped with the buyer’s choice of seats and cabin equipment, whereas it is common practice for corporate aircraft to be delivered unfurnished (in a so-called “green” configuration) to a dedicated completion centre which will be responsible for fitting out the interior in accordance with the buyer’s specification. The completion of a large-cabin corporate jet can take a year or more and can cost in excess of $30 million. There is currently a shortage of facilities able to undertake this high-value but demanding work. It is worth noting that a number of the existing corporate aircraft maintenance and completion centres are in relatively high-cost locations such as Switzerland, in comparison with which Ireland is likely to have a relatively favourable cost base.

As with commercial aircraft, maintenance organisations specialising in business jets tend to forge close relationships with the aircraft manufacturers, and there is certainly scope to explore not just with existing corporate aircraft maintenance providers but also directly with the principal corporate aircraft manufacturers their interest in developing or supporting new Shannon-based facilities.


Shannon already attracts an average of about 10 corporate-aircraft arrivals or departures each day. Approximately 95% of the business jets using Shannon are making fuel stops before or after Atlantic crossings, although relatively few of the US-bound aircraft are making use of the CBP facility at Shannon. There is clear scope to target a much higher level of corporate aircraft activity, building on existing corporate aircraft facilities at Shannon and potentially enhancing them with additional dedicated terminal or hangar infrastructure for corporate and private aircraft.

Recommendation 30

Evaluate the feasibility of establishing an Irish corporate aircraft registry and the business case for doing so.

Recommendation 31

Promote Shannon’s potential for corporate/private aircraft MRO and completion facilities to this sector.

Recommendation 32

Explore the feasibility of enhancing Shannon’s corporate and private aircraft facilities, including the construction of dedicated terminal or hangar facilities with private investment.

5.9Regulatorycomplianceservices

As a highly regulated and safety-conscious industry, aviation has a particularly strong need for training and expertise. This is particularly the case in developing countries which may not have a strong history of effective aviation regulation and oversight. Many countries’ regulatory oversight of their national airlines’ and airports’ safety is lacking, typically through a lack of experience or a failure to recognise the importance of such oversight.

International audit and inspection programmes have successfully focused many countries’ attention on the need to reform their governance procedures if their carriers are to gain access to European or US markets. However, the expertise to bring a country’s airworthiness authority up to appropriate international standards is difficult to find outside the senior staff of existing well-established authorities.

There exists therefore the potential for a commercial consultancy with a worldwide remit to be established, for example by the Irish Aviation Authority, focusing on assisting other nations’ airworthiness authorities to build and maintain their own oversight and governance capabilities.

In many cases such intervention would be on the basis of a purely commercial contract. In other cases it could be provided as part of an Irish bilateral aid package of the sort managed by Irish Aid, located in Limerick.

It is not suggested that a commercial regulatory consultancy would necessarily limit itself to putting appropriate third-country oversight structures in place. Countries developing their aviation industry are likely to face a wide range of requirements, from airspace design to personnel licensing. A consultancy able to draw on the expertise of a knowledgeable and commercially focused airworthiness authority such as the IAA would be strongly positioned to assist in meeting these requirements. It is suggested that the pragmatic and effective airworthiness authority culture which has developed in Ireland could form the basis for a successful international consulting organisation, linking Ireland with many emerging nations, for their benefit as well as for that of this country.

Recommendation 33

Explore the feasibility of establishing a Shannon-based commercial consultancy arm of the Irish Aviation Authority, providing regulatory compliance assistance and other consulting services to international clients.

5.10Specialistairlineoperations

Alongside conventional scheduled and charter airlines a number of specialised types of aircraft operators exist. These include, among others:

• ACMI (Aircraft, Crew, Maintenance and Insurance) providers, who specialise in providing aircraft, often at short notice, for conventional carriers who are in need of additional capacity

• Specialised “outsize cargo” operators who fly large cargo aircraft capable of carrying larger or heavier loads than conventional freighters

• Special-mission operators such as operators of firefighting and oil spill dispersal aircraft

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• Charitable organisations such as ORBIS, which operates an aircraft converted into a flying eye hospital carrying out eye surgery in developing countries

The Task Force notes that an aviation cluster at Shannon, combining a range of maintenance services, regular cargo and passenger service, training facilities and relatively low-cost fuel and parking, could be attractive to operators such as the above.

The Task Force also notes that the Department of Foreign Affairs has commissioned a study into the feasibility of a humanitarian supply hub at Shannon and the report of the study is awaited.

Recommendation 34

Market Shannon as a potential base to specialist operators, on the basis of preferential landing and property charges for based operators.

5.11Heritage,tourismandnetworks

The Task Force’s reflections on the components of an aviation centre of excellence have also led it to consider the importance of Ireland’s intangible aviation heritage as well as its concrete heritage in the form of businesses and skilled professionals.

5.11.1 National Aviation Museum

Ireland boasts a long and proud aviation tradition, from pioneering early flights through the development of commercial air services, first with the precursor of Aer Lingus in 1936 and subsequently by seaplanes at Foynes and then long-range “landplanes” for which Shannon was a strategic location. Recent years have seen operating leasing, largely pioneered in Shannon, develop worldwide as the asset ownership structure underlying and enabling much of the airline industry. Ryanair has grown from a small Irish regional airline to one of the world’s largest and most innovative, spawning a host of imitators across the world.

Despite this history, Ireland does not have a national aviation museum. The Task Force believes that there is a clear opportunity to create such a museum, drawing together Shannon’s iconic status within Irish aviation history, and the availability of ample land and buildings at the airport. A National Aviation Museum at Shannon would provide a magnet for both Irish and overseas visitors, would generate additional traffic to and through the airport, and would fit Clare County Council’s goal of creating a major international tourist attraction in the county. The museum would

seek to provide a national resource encompassing all aspects of Irish aviation history, complementing rather than supplanting any existing collections.

A suitable site for such a museum has been identified on Shannon Airport property. Initial soundings undertaken with the local authority have met with an enthusiastic reception, and a number of potential leads for philanthropic support have also been identified. The Task Force recommends that a small working group now be established under the aegis of the new Shannon entity to formulate plans for a National Aviation Museum.

Recommendation 35

Establish a small working group to evaluate and progress plans for a National Aviation Museum at Shannon.

5.11.2 Aviation conference

As noted above, Ireland has trained many aviation professionals who have subsequently emigrated, bringing their skills and their passion for aviation to other countries and often helping to establish or lead aviation ventures there.

Drawing on Shannon’s planned international centre of excellence for aviation, and in the context of The Gathering in 2013, it is suggested that an aviation conference in the Shannon Region could be organised in Summer 2013, with a specific focus on the Irish aviation diaspora worldwide.

The goal of the event would be to bring Irish aviation-industry “alumni” back to the country to reconnect with their peers as part of an ongoing networking process, to share expertise from Irish airline CEOs and entrepreneurs, and as a key priority to provide a “shop window” on the emerging Shannon International Aviation Services Centre.

This event could build on or be separate from the existing Shannon Business Aviation Convention. The Task Force has already received indications of interest from major aviation firms interested in being associated with or sponsoring such an event, and it is suggested that international airlines with Irish CEOs might be well disposed to providing discounts on flight ticket prices for attendees to travel to the event.

Recommendation 36

Establish a small working group to plan and organise a 2013 Shannon aviation conference targeting the Irish aviation-industry diaspora.


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6 EmploymentPotential

The strategic value of Shannon derives not from its history but from its long runway, its location, its land bank and to a secondary degree the fifth-freedom service opportunities encapsulated in Irish bilateral air service agreements, which combine to offer considerable potential for employment creation and economic development.

As already noted, the foundation of an aviation-industry cluster already exists at Shannon, with approximately 1,600 staff employed by 40 aviation-related companies. The continuing development of aviation-related businesses within the Shannon region will provide benefits to these companies in terms of proximity to suppliers and customers, ability to share infrastructure, and ease of co-operation. These benefits will translate in turn into lower costs, increased competitiveness and increased employment. This concentration of expertise will also enable Ireland to raise its worldwide profile as a location for aviation services and to market its offerings more effectively.

There exist strong opportunities to develop Shannon’s presence and activity in a number of aviation industry sectors, including maintenance, training, aviation support activities and aviation finance among others.

The Task Force believes there is a genuine opportunity to create an internationally competitive Aviation Services Centre at Shannon, which would build on Ireland’s strengths and would serve to anchor the aviation and aviation-finance industry already present in Ireland.

The Task Force has formed an assessment of the five-year direct employment potential resulting from the new Shannon entity. This has been done on a sector-by-sector basis, combining known and existing firms in each sector with identified opportunities and taking an informed view of the likely range of employment which could be generated by each. Discussions with companies covered their expansion plans, business areas for which expansion was targeted, timescales, and, where possible, numbers of jobs; whether Shannon could potentially be of interest for expansion; and the key enablers and impediments to expansion in Shannon. A number of the industry discussions have been on a confidential basis, precluding the inclusion of company names to job numbers.

6.1OngoingIASCdirectemployment

The incremental employment generated and sustained by the new entity over a five-year timescale is estimated at 3,000-3,500 jobs.

The employment estimates do not include significant additional employment creation potential from a number of other aviation-related projects that the Task Force has identified. These projects are currently in early development phases and seek to apply “outside the box thinking” to drive disruptive

innovation in diverse aspects of the aviation industry. It is the view of the Task Force that if their early potential is confirmed they will have the ability to transform particular aviation industry sectors and to deliver large numbers of specialist jobs.

The Task Force has been able to obtain specific commitments from two existing Shannon companies to expand their employment there in the context of an International Aviation Services Centre. These two commitments alone account for approximately 1,000 jobs.


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A detailed Business Plan has been prepared to meet the requirements of the State Airports Act 2004 and to provide a basis for obtaining Ministerial consent to separation. The Business Plan provides for a continuation of State ownership throughout the period of the plan. The plan has been independently validated by KPMG on behalf of the Department of Transport, Tourism and Sport.

Both the Dublin Airport Authority and Shannon Airport have also completed transition plans for separation by year-end 2012.

7.1Organisation

The new entity is envisaged to combine Shannon Airport with a restructured Shannon Development.

The incorporation into the new entity of the Shannon Development property portfolio (which is unencumbered by bank debt) is a key recommendation of the Booz report and the Task Force concurs that this is an essential step. The property portfolio, in particular those lands and properties located adjacent to Shannon Airport, have the potential to provide development space for the International Aviation Services Centre, ranging from incubation and office space in the short term through to major airside expansion in the medium and long term.

The property portfolio is described in detail in the Business Plan.

7.1.1 Merger of SAA and a restructured Shannon Development

The business plan assumes that the activities currently carried on by Shannon Development will be restructured such that the activities principally related to property ownership and management will be merged into the new entity together with the activities of Shannon Airport.

7.1.2 SD property portfolio

The property portfolio owned by Shannon Development comprises the properties and lands situated in the Shannon Free Zone and surrounding business parks (considered “core” to IASC activities), and properties and lands in the wider Midwest region. The current occupancy levels are relatively low and the rental income from the Shannon properties is correspondingly modest, but the property portfolio, which is unencumbered by bank debt, gives the new entity considerable scope to facilitate the development of aviation businesses

(both landside and airside) in the medium and long term.

7.1.3 Potential organisational structure and resourcing

A number of options were considered for the structure of the new entity. In the end the preferred structure was a simple one in which the functions of airport operations and property management reported to a small top-level corporate management team.

7.2Interfacewithstateagencies(IDA,EnterpriseIreland,FáilteIreland)

The new entity will work very closely with Enterprise Ireland and the IDA to develop the planned Shannon aviation cluster, and it will rely on these agencies’ expertise, commitment and support (including grant aid to enterprises) as an essential enabler of the success of the project.

The Task Force has invited the IDA and Enterprise Ireland to outline for this report the activities they plan in support of the new Shannon entity, and the agencies’ input is presented in the following two sections.

It is anticipated that the functions of Shannon Heritage will also be merged into the new entity. The new entity will therefore also work with Fáilte Ireland to define an optimal operating framework.

7.2.1 IDA

IDA Ireland welcomes the new Shannon entity initiative and looks forward to collaborating for the winning of new job creating investments for the region, in particular in relation to the aviation/aerospace sector. We believe that this positive project for Shannon will rejuvenate the Shannon

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brand internationally and we will work to enhance this through direct engagement with target clients.

IDA Ireland will market Shannon for foreign direct investment as the aviation industry centre for Ireland with particular emphasis on:

• Parts Manufacture

• MRO

• Aviation Services

• Aviation Financial Services

• Pilot Training

• Other engineering and technical activities

IDA Ireland sees Shannon and the aviation engineering cluster in Shannon as the prime location in terms of infrastructure; airport, runway, industrial park, existing companies, training institutes and depth of experience within the industry along with its proximity to Limerick city and its university are key selling points to winning new investment for the region.

IDA Ireland will work closely with the new entity to create a brand within the aviation sector which will attract new job creating investments to Shannon. Through our network of offices internationally, when meeting with aviation related target companies, Shannon will be central to the Ireland message.

The increased focus on Shannon through the creation of the new entity and the plans for investment and incentives will allow IDA Ireland to highlight Shannon as a premier European location for aviation related activities. This will be a key priority of the teams working on engineering related activities and financial services.

In relation to existing companies IDA will engage at corporate and local management levels to focus on winning additional business from FDI clients (55) based in Shannon.

7.2.2 Enterprise Ireland

The Government has decided to separate Shannon Airport from the Dublin Airport Authority and to merge certain activities of Shannon Development with Shannon Airport to form a new entity. A consequence of this merger is that the current responsibility for the development of indigenous industry around Shannon Airport will transfer from Shannon Development to Enterprise Ireland. As part of this process there is a desire to develop a world class Aviation Industry cluster at Shannon.

Enterprise Ireland fully supports the objective to build an Aviation Industry cluster of enterprises at Shannon and believes that the advantages of Shannon as a location can be strengthened to create the environment to deliver significant employment growth. The focus on Shannon as an Aviation Industry location and the commitment of a large number of private and public sector interests to this project will contribute to our objective to develop an indigenous aviation industry cluster of enterprises at Shannon.

The route Enterprise Ireland will take to contribute to the development of an aviation industry cluster at Shannon will be the development of a group of High Potential Start Up enterprises. Enterprise Ireland will design and deliver a series of promotional and support programmes specifically targeting potential entrepreneurs to locate new start up businesses at Shannon in the Aviation Industry sector.

Enterprise Ireland will work closely with the new Shannon entity to build an environment that will encourage and support entrepreneurship in the Aviation sector at Shannon.

Recommendation 37

Encourage start-ups and SMEs through provision of incubation space and/or high-potential start-up programmes such as those offered by Enterprise Ireland.

7.2.3 Proposed operating framework with IDA and Enterprise Ireland

The following is the Task Force’s proposal for an operating framework guiding the new entity’s activities and interfaces with the state development agencies. While the focus is clearly on the development of aviation-related activity, it is important that the agencies also work together to provide ongoing support and development assistance to non-aviation-related companies within the Shannon Free Zone.

i Delivery on the new entity’s job creation objectives will require close inter-agency cooperation.

ii It is anticipated that the jobs will derive from a combination of sources including companies already established at Shannon, indigenous Irish businesses choosing Shannon as a base for development of existing or new activities, indigenous and international start ups and

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early stage businesses, internationally mobile investments and proactive project building and linkage activity designed to exploit the undoubted leverage created by Ireland’s significant clout in key areas. In all instances the task of promoting the infrastructure, skills, cost, tax and financial incentives which make Shannon an attractive location will fall to Shannon-based IASC personnel with the proactive support and co-operation of IDA, EI, Fáilte Ireland and other agency personnel.

iii IASC personnel will develop image-building campaigns and related promotional materials as warranted for each of the local, indigenous Irish, and internationally mobile investment markets that are a focus of the Shannon initiative. These campaigns will be discussed with requisite agencies and their proactive support will be solicited in implementing the campaigns.

iv For businesses already based at Shannon, IASC will typically be the landlord and will have a close working relationship with them. As part of the ongoing relationship, investment generation, investor facilitation and after care services will be provided by IASC personnel working closely with other agency personnel where relevant to secure the approval of optimal incentives packages to facilitate investments.

v For existing indigenous businesses in the aviation and related sectors to whom Shannon and its advantages are a potential attraction, IASC personnel will seek to build awareness of the Shannon offer through a combination of research, direct targeting, seminars and events, and project building/linkage activity. IASC will work closely with Enterprise Ireland in this respect.

vi For indigenous start-ups IASC will work with Enterprise Ireland to develop a bespoke programme to be delivered in the Shannon area designed to provide a catalyst to new enterprise formation. This will it is anticipated be funded by EI as part of its general enterprise promotion activities.

vii For internationally mobile investment it is proposed that IASC personnel will work with IDA to develop a campaign of promotional activity, direct targeting, investment seminars

and inward missions designed to build awareness of the Shannon offer, stimulate site visits to Shannon and generate investment opportunities to which suitable incentives packages might be directed by IDA. It is anticipated that such campaigns and related activity levels will be agreed in advance annually. The precise roles to be adopted by respective agency personnel will be defined in that context.

viii For emerging international companies in the aviation and related areas it is proposed that IASC personnel will work with IDA to identify suitable targets for relocation to the Shannon region and develop appropriate direct targeting and or seminar activity to promote Shannon and its attractions. This will include both US and European companies.


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8 KeyIncentivesandEnablers

While there is considerable goodwill towards Shannon in the Irish aviation and business community, mere goodwill will not suffice to deliver new business, least of all from the international aviation industry on whose participation the ultimate success of the new IASC entity depends. A set of incentives is required to support the aviation sector in Ireland, which would ideally apply to Irish and overseas businesses setting up or expanding operations, as well as investors funding infrastructure development. Shannon would be in a position to benefit from any such incentives.

A list of potential nationally applicable incentives has been developed, covering investment, employment, and enterprise development, and a submission has been made to the Department of Finance for consideration.

8.1KeyEnablers

As has been noted already, the single most important enabler for the success of the new entity is the separation of Shannon Airport from the DAA.

Recommendation 38

Adopt a phased process to enable the resolution of Shannon Development restructuring issues, with airport separation occurring by year-end 2012 followed by the merger with a restructured Shannon Development on 1 July 2013.

There are a number of other key building blocks in the development of the International Aviation Services Centre, which are set out below.

8.1.1 Hangar development

Shannon Airport’s extensive land holding (about 850 hectares in SAA ownership plus a further 250 hectares in the adjacent Shannon Free Zone) gives a potential for aviation-related industrial development which is lacking in the majority of airports. While sites for half a dozen large aircraft maintenance hangars have already been identified, further expansion of airside facilities would be possible either by building to the north of the main runway (necessitating some extension of local services) or by extending the airside boundary to encompass some parts of the current Shannon Free Zone which could be redeveloped.

8.1.2. Phased build-out

As noted above, it is not proposed to construct hangars on a purely speculative basis. A more prudent approach is to identify the sites for hangar

construction and perhaps proceed to outline planning permission for the hangars, as long as the latter does indeed deliver appreciable time savings over later individual applications even when possible configuration changes are taken into account. Construction of each hangar would then only begin when the tenant for that hangar had been identified and had committed to a lease.

8.1.3 Funding mechanisms

The consistent feedback from industry interviews was that many MRO providers and related businesses may not wish to own their own facilities, preferring instead to maintain the flexibility that comes with a long lease on a rented building. While significant interest from maintenance providers has been identified, it is clear that the availability of appropriate infrastructure for rental will be essential if this interest is to be converted into something more concrete. A funding application and business plan will be prepared and submitted to the European Investment Bank in respect of the proposed infrastructure. An initial approach to the EIB in this regard has been made by the Department of Finance.

8.1.4 Dedicated Aircraft parking areas

A number of aircraft maintenance providers, as well as aircraft lessors, have highlighted the advantages of ample dedicated long-term aircraft parking areas being made available. These are typically used for the storage of aircraft for a period of weeks or months, perhaps when they are repossessed by a lessor from an airline that has run into financial difficulty, or when they return from one lessee before the next has been identified. The presence of sufficient reasonably priced aircraft parking is likely to


serve as a catalyst for other economic activity at the airport.

8.1.5 Office/light industrial space

Aviation software and systems development companies, along with specialist suppliers and subcontractors to the aviation industry, are typically much smaller than the airlines, OEMs and MRO organisations who are their clients. Provision of office and light industrial space for these companies, including in particular incubation space for start-ups and SMEs, will be an essential part of IASC’s activity, in terms not only of seeding future expansion but also of establishing Shannon as a credible and diverse aviation cluster.

8.1.6 Shannon Development real estate

As noted above, the integration of the Shannon Development property portfolio into the new entity (to be achieved through the merger with the restructured Shannon Development) is an important foundation for its sustainability. The property portfolio not only provides rental income but also gives the new entity room for expansion and development. Shannon is extremely fortunate to have this land area adjacent to the airport available for expansion; many aviation clusters internationally are heavily constrained in their expansion by a lack of space.

The Shannon Free Zone (SFZ) represents a significant opportunity for the new entity to develop activity and revenue, provided that an effective means is developed to redevelop the site and potentially to extend the airfield boundary to encompass part of the existing SFZ within the “airside” zone so as to enable other airside activities.

The Shannon Development lands can be divided into two categories: those located in Shannon, in particular in the SFZ, and those located elsewhere in the Midwest. Of particular immediate relevance for the new entity and for the development of Shannon are the SFZ lands. A certain proportion of the industrial buildings on these lands are legacy light industrial facilities in a relatively poor state of upkeep and which were already earmarked for demolition and redevelopment in the existing Shannon Development master plan. As part of the proposed merger of a restructured Shannon Development into the new entity, a due diligence exercise is being undertaken.

The new entity’s property management activities for the Shannon lands and properties will be directly

linked to its overall objective, the development of economic activity and in particular the development of an international aviation centre at Shannon. Property assets may be used as a promotional tool for this development, and the overall focus will be on creating the circumstances that will deliver maximum return to the new entity and the national exchequer. This will involve maximising the efficiency and effectiveness of the property management and development functions of IASC. The same principles should apply to other elements of the property portfolio located elsewhere in the Midwest.

Recommendation 39

Evaluate scope to increase airside land area by extending airfield boundary into existing SFZ land.

Recommendation 40

The new entity should seek to evaluate and segregate its property portfolio into those assets which it sees as central to achievement of its broad objectives and those which are not.

Recommendation 41

While the new entity may seek to maximise the returns from its Shannon property portfolio taking into account market opportunities, it should generally make decisions related to its property assets which are consistent with the achievement of its objectives in the broadest sense.

Recommendation 42

Decisions on the letting, sale or disposition of the Shannon property portfolio assets should have regard to the wider economic impact and should take into account not just the net rents or the net sales proceeds but also the wider benefit which would accrue to the new entity and the Exchequer.

Recommendation 43

he new entity should as far as possible seek to manage the non-Shannon properties on an ongoing basis or dispose of non-Shannon property assets, taking into account its assessment of the market and seeking to achieve the highest net present value for those properties at the time of sale.

46

Recommendation 44

Upon the creation of the new entity and prior to the merger with a restructured Shannon Development, Shannon Development should provide a covenant to the new entity in respect of SD assets relating to the pre-merger period. In addition, during this period the new entity should be able to make recommendations to the board of SD to enter into particular property related transactions consistent with the objectives of the new entity.

8.1.7 Strategic Infrastructure provisions

The Planning & Development (Strategic Infrastructure) Act 2006 introduced the provision that an application for permission for any development specified in the “Seventh Schedule” shall, following a screening process, be made to An Bord Pleanála rather than to a planning authority if certain conditions are met which mean that the development would be of strategic or economic importance.

An airport that comes within the “Seventh Schedule” is defined as

“An airport (with not less than 2 million instances of passenger use per annum) or any runway, taxiway, pier, car park, terminal or other facility or installation related to it (whether as regards passenger traffic or cargo traffic).”

In the case of Shannon Airport the annual passenger levels are now at approximately 1.4 million. As such, Clare County Council has indicated to the Department of Environment, Community & Local Government (DoECLG) and to the Task Force that it considers Shannon Airport to be outside of the criteria set out under the legislation. However, An Bord Pleanála has previously determined that Shannon Airport falls within the “Seventh Schedule” as it has an operational capacity of more than 2 million passengers. This is confirmed in a recent decision of An Bord Pleanála15.

The Task Force concurs with the view of Clare County Council and would recommend that the DoECLG and An Bord Pleanála revisit this matter in order to streamline the planning process at the airport and adjacent lands. This would be a short-term enabling measure until the airport’s annual passenger numbers once more exceeded two million.

Recommendation 45

DoECLG and Bord Pleanála to review determination that Shannon Airport falls within Seventh Schedule of Planning and Development (Strategic Infrastructure) Act 2006.

8.1.8 Commercial rates and Development Contributions

It is recommended that consideration be given to a commercial rates incentive scheme for new aviation related enterprises around the airport. In the past, this arrangement has been successfully implemented by Government through the Urban Renewal Scheme and a similar model, with the necessary legislation, could be introduced for the airport and surrounding lands. The scheme could provide for a ten year arrangement whereby full rates were payable in the 10th year having increased by increments of 1/10 during the previous nine years.

In tandem with the above it is recommended that Clare County Council review its General Development Contribution Scheme with a view to specifically facilitating new aviation related enterprises at the airport and its land bank. The area could be designated as a special zone within which reduced contributions would be applicable.

8.1.9 Land use planning, and marketing of land bank

Large parts of the airport lands are not currently in use and are capable of being developed in the short to medium term for airport related projects. These lands have been zoned for airport use in the Shannon Town & Environs LAP 2012-2018. Potential future use of these lands has been examined as part of the Shannon Airport Master plan recently prepared by the DAA. It is recommended that the Airport authorities and Clare County Council identify as soon as practicable the precise lands that are available and that these be marketed without delay. The Task Force notes that it is an objective of the Clare County Development plan for the Council, in collaboration with other agencies, to prepare a High Level Strategic Plan, to identify key priority projects and developments capable of being accommodated at the Shannon Airport lands, Shannon Free Zone and Westpark. If necessary

15 Ref. No. 03.PC0144 of July 2012


the airport authorities should consider applying for planning permission in order to minimise the time needed to deliver completed infrastructure following a tenant commitment.

Recommendation 46

Shannon Airport Authority should work with Clare County Council to identify and agree specific areas of airport land bank for specific categories of development, and should evaluate the feasibility of applying for planning permission.

The embankment walls that surround Shannon Airport were constructed in the early days of the airport to protect the site from the adjoining estuarine waters. The embankments now provide protection for areas beyond the airport. In this regard the ongoing Shannon Catchment Flood Risk Assessment Management Study (CFRAMS) has identified Shannon Airport as an area for further assessment. The OPW is charged with working in partnership with the local authorities to deliver CFRAMS.

Recommendation 47

That consideration be given to the OPW being designated as the party responsible for any works or for implementing any recommendations which arise out of the Shannon CFRAMS study.

8.1.10 Access

The development of the national road network in recent years has greatly contributed to the ease of road access to Shannon Airport and to the enlargement of its catchment area. Road access to Shannon Airport is generally very good, with the exception of the last kilometre of the N19.

At present the N19 gradually transitions from a dual carriageway to a single carriageway as vehicles approach the airport curtilage from the Drumgeely roundabout. This is not only detrimental to the image of Shannon as an international airport but is inadequate both for the functioning of the airport and for emergency management purposes.

The current arrangement also places constraints on harnessing the potential from the non-operational lands in the airport land bank.

It is therefore recommended that the N19 dual carriageway be extended into the airport. The lands required are in public ownership. It is clear therefore

that a road corridor exists that would allow this to be progressed by the NRA.

The Shannon Town & Environs Local Area Plan 2012-2018 contains an objective to support this. In the medium to long term the Shannon LAP also has an objective for the continuation of the existing Aerospace Road to serve future airport-related development lands. Lands required to facilitate extension of the road are in local authority or airport ownership.

Recommendation 48

Clare County Council to evaluate the feasibility of putting in place a programme of rates relief and reviewing possible alleviation of development contributions as an incentive mechanism for new enterprises.

Recommendation 49

Explore potential for extension of N19 dual carriageway road into airport.

8.1.11 Secondary enablers

The Task Force has noted a number of other inhibitors to the efficient development of business and tourism activity in Shannon and more widely. These are noted below.

i. Visasfornon-EUnationals

Companies have remarked repeatedly on the difficulty of obtaining visas for non-EU citizens, whether management or staff travelling to Ireland for business purposes or tourists wishing to visit Ireland.

In the context of Shannon Airport’s endeavours to attract transit traffic, e.g. non-EU long-haul carriers stopping off in Shannon en route to the United States, it would be particularly valuable to be able to indicate to the airlines concerned that their passengers would have the ability to stop off in Ireland en route without onerous visa formalities, and the potential additional passenger revenue could be decisive in an airline’s route evaluation.

Multinational and internationally active firms in Shannon already face Shannon’s relative lack of connectivity compared to locations in Continental Europe, and Ireland’s non-membership of the Schengen zone. To assist these firms to compete in an international marketplace, it is essential

48

that these factors are not further exacerbated by difficulty and delay in obtaining visas.

Recommendation 50

Review and simplify visa process for non-EU visitors, with particular reference to business visas and to main prospective non-EU inbound tourist markets.

ii.AbilityforShannonChambertocertifyCertificatesofOrigin

It is standard practice that companies involved in the export of manufactured goods must prepare Certificates of Origin, which are certified by the local Chamber of Commerce. Although a substantial proportion of the goods exported from the region originate in Shannon, Shannon Chamber is not authorised to certify these certificates, leading to delays and additional expense for Shannon companies. It is recommended that Shannon Chamber be given this authority, in common with many other Chambers.

Recommendation 51

Revenue to authorise Shannon Chamber to certify Certificates of Origin.


9

50

The separation of Shannon Airport from the Dublin Airport Authority is supported by a wide range of stakeholders from across the region, who are keen to see the airport develop its activities and regain a position as an economic driver for the Midwest and beyond.

The strategic value of Shannon derives not from its history but from its runway, its location, its land and property portfolio, and to a secondary degree the fifth-freedom service opportunities encapsulated in Irish bilateral air service agreements.

The Task Force believes that the aviation business opportunities that have been identified are sufficiently diverse and substantial to constitute the core of an International Aviation Services Centre (IASC). In light of the commitments which have already been obtained from potential “anchor tenants”, it is the view of the Task Force that such a Centre can be feasible, and can apply and develop Shannon’s and Ireland’s aviation capability in an international context.

In evaluating the feasibility of Shannon Airport as a standalone entity, the Booz report expressed concerns about its sustainability given the costs of servicing its historic debt in addition to operational and capital expenditures and other liabilities. The Task Force concurs with this concern and recognises the importance of fulfilling all the statutory conditions for separation under the 2004 State Airports Act, including demonstrating the sustainability of the new entity.

The new entity has already put in place adequate working capital facilities, and transition plans for both the Shannon Airport Authority and the DAA have been completed.

The existence of an appropriate range of incentives will play an important part in attracting international business to IASC, and the Task Force has made a submission to the Department of Finance.

The Business Plan for the new entity sets out the assumptions under which Shannon can be viable and makes provision for necessary expenditures. Within the Business Plan, no IASC revenue or external IASC funding is assumed; this will be elaborated in detail in a subsequent master plan.

9 FeasibilityAssessment


Recommendation 52

Urgently complete transition plan for Shannon Development.

9.1Riskstodelivery

Ireland and Shannon benefit from a range of current and potential strengths, which give rise to a genuine opportunity to create a world-class aviation centre of excellence. However the competition is global in nature and it will be necessary to equip the Centre with the appropriate tools to be able to succeed in this competitive marketplace. A failure to do so would limit the centre’s ability to develop its reputation, activities, employment or Exchequer benefit. Conversely if a truly competitive basis can be established for the proposed Centre, there is every reason to be optimistic for the future.

The principal delivery risks are enumerated below:

Delayinseparationleadingtolossofmomentumandgoodwill

The announcement of the airport’s impending separation has generated considerable goodwill and enthusiasm for a new beginning. Failure to capitalise on this in a timely manner would impair the ability of airport management to win further air services, and of Shannon Development and other agencies to attract businesses to locate in the region.

FailuretoestablishShannonasanattractivebusinesslocation

The vision for the new International Aviation Services Centre is of a cost-effective and globally competitive location for aviation-related businesses to develop their activities. To make this vision a reality will require a dedicated and effective marketing effort in parallel with the existing industrial development agencies but will also require an appropriate package of incentive measures, as discussed in Section 8 above. Failure to put both these elements in place will mean that Shannon and IASC fail to live up to their full potential.

Failuretoputappropriateinfrastructureinplace

The provision of infrastructure such as hangars, specialised terminals and parking areas is essential to attract business in many of the aviation industry sectors discussed here. This provision is in turn dependent on the ability to attract external funding and to complete both planning approvals and construction without delay.

Failuretoachievesustainablecostbase

The new IASC entity will be formed from a merger of Shannon Airport and a restructured Shannon Development. In a highly competitive marketplace, the new entity will have to deliver conspicuous value for money, whether to be able to attract new airline business or to win new industrial developments. This in turn will require a manageable opening balance sheet and a nimble, commercially focused and lean organisation, with a cost base on a par with Shannon’s and IASC’s peers and competitors. We note that Shannon Airport’s costs are currently higher than industry peers. Failure to move progressively to reduce this disadvantage will impair the new entity’s ability to compete successfully. In particular, an inability to offer competitive charges to airlines will result in Shannon being unable to meet its passenger growth targets, or in the worst case, to the airport being unable even to maintain its existing passenger numbers.

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10

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We believe there is scope to deliver on the vision outlined above, creating a new entity built on the foundations of SAA and SD which can form the nexus for a vibrant and globally competitive international aviation services cluster in Ireland.

The complete list of the recommendations made in the course of this report is presented below, grouped into three broad headings: Separation, Business Development and Other. The recommendations are also restated for completeness in the order in which they occur in the report.

A mechanism for the implementation of these recommendations will need to be established. This will be a task for the Board of the new entity.

10.1RecommendationsonSeparation

1 Announce separation without delay and formally separate Shannon Airport from DAA by 31 December 2012.

2 Adopt a phased process to enable the resolution of Shannon Development restructuring issues, with airport separation occurring by year-end 2012 followed by the merger with a restructured Shannon Development on 1 July 2013.

3 Establish the new entity and recruit a CEO.

4 Reconstitute the Shannon Airport Authority board without delay.

10.2RecommendationsonBusinessDevelopment

5 Shannon Airport management should keep under review from an overall cost benefit perspective the specific costs and revenues associated with 24/7/365 operation, over and above operation in normal commercial hours.

6 Shannon Airport should evaluate ways to differentiate itself positively from competing airports in the eyes of its passengers and potential passengers.

7 Shannon Airport should evaluate its business processes and practices for their appropriateness and where needed should develop new processes tailored to its new requirements with a focus on productivity and competitiveness.

8 Shannon should keep its commercial revenue strategy and commercial unit revenues under review with a view to learning from best practice and considerably enhancing commercial revenue and overall profit per passenger.

9 Shannon should seek to attract additional short-haul traffic and revenue through appropriate incentive deals.

10 Shannon should continue to develop its long-haul terminal traffic, chiefly in the North American market.

11 Shannon should draw on the Department of Transport, Tourism and Sport’s willingness to negotiate new Irish bilateral Air Services Agreements, and to include fifth-freedom rights, in order to develop additional long-haul airline service opportunities.

12 Shannon should aggressively market existing fifth-freedom opportunities for long-haul transit traffic.

13 Update and validate business case for constructing a modern cargo terminal with cold-chain capability at Shannon, preferably in partnership with a specialist company.

10 Recommendations


14 A focused and targeted marketing campaign to key cargo carriers should be undertaken by the new entity.

15 Continue to target high-added value MRO and MRO-related activities: lease transition, CAMO/technical document support.

16 Develop plan to roll out hangars and other infrastructure rapidly in response to market demand.

17 Develop plan for dedicated parking, and explore potential for entering into “preferred supplier” contracts with lessors and airlines for parking.

18 Work to attract a design or completion centre for a non-European aircraft manufacturer targeting the European market.

19 Market Shannon as a location for pilot training organisations.

20 Pursue complementary opportunities for technical and ATC training as well as for other aviation-industry education provision.

21 Explore the possibility for College Ireland or a successor body, to be based in Shannon, to provide co-ordination and marketing support for the activities of Irish aviation training SMEs.

22 Target additional industrial placements for local universities with key aerospace companies and OEMs worldwide.

26 Pursue software development for the aviation industry as a key sector.

27 Support innovative projects and research in aviation finance in collaboration with local companies and educational institutions.

29 Examine the potential for specific incentives to attract international business to issue EETCs in Ireland, for example through a targeted exemption from withholding tax.

30 Evaluate the feasibility of establishing an Irish corporate aircraft registry and the business case for doing so.

31 Promote Shannon’s potential for corporate/private aircraft MRO and completion facilities to this sector.

32 Explore the feasibility of enhancing Shannon’s corporate and private aircraft facilities, including the construction of dedicated terminal or hangar facilities with private investment.

33 Explore the feasibility of establishing a Shannon-based commercial consultancy arm of the Irish Aviation Authority, providing regulatory compliance assistance and other consulting services to international clients.

34 Market Shannon as a potential base to specialist operators, on the basis of preferential landing and property charges for based operators.

37 Encourage start-ups and SMEs through provision of incubation space and/or high-potential start-up programmes such as those offered by Enterprise Ireland.

38 Facilitate maximum feasible incentive package to underpin success of IASC in internationally competitive arena.

39 Evaluate scope to increase airside land area by extending airfield boundary into existing SFZ land.

40 The new entity should seek to evaluate and segregate its property portfolio into those assets which it sees as central to achievement of its broad objectives and those which are not.

41 While the new entity may seek to maximise the returns from its Shannon property portfolio taking into account market opportunities, it should generally make decisions related to its property assets which are consistent with the achievement of its objectives in the broadest sense.

56

42 Decisions on the letting, sale or disposition of the Shannon property portfolio assets should have regard to the wider economic impact and should take into account not just the net rents or the net sales proceeds but also the wider benefit which would accrue to the new entity and the Exchequer.

43 The new entity should as far as possible seek to manage the non-Shannon properties on an ongoing basis or dispose of non-Shannon property assets, taking into account its assessment of the market and seeking to achieve the highest net present value for those properties at the time of sale.

48 Clare County Council to evaluate the feasibility of putting in place a programme of rates relief and reviewing possible alleviation of development contributions as an incentive mechanism for new enterprises.

10.3Otherrecommendations

23 Specific academic and training courses focusing on composites should be developed by UL, LIT and other institutions.

24 Explore potential for further dedicated aviation/tourism academic research infrastructure supported by European funding.

25 The Department of Education should implement the amalgamation of Shannon College of Hotel Management with NUI Galway as soon as possible.

28 Ireland should move to full (equivalent to “Alternative A”) adoption of the Cape Town Treaty without delay.

35 Establish a small working group to evaluate and progress plans for a National Aviation Museum at Shannon.

36 Establish a small working group to plan and organise a 2013 Shannon aviation conference targeting the Irish aviation-industry diaspora.

45 DoECLG and Bord Pleanála to review determination that Shannon Airport falls within Seventh Schedule of Planning and Development (Strategic Infrastructure) Act 2006.

46 Shannon Airport Authority should work with Clare County Council to identify and agree specific areas of airport land bank for specific categories of development, and should evaluate the feasibility of applying for planning permission.

47 That consideration be given to the OPW being designated as the party responsible for any works or for implementing any recommendations which arise out of the Shannon CFRAMS study.

49 Explore potential for extension of N19 dual carriageway road into airport.

50 Review and simplify visa process for non-EU visitors, with particular reference to business visas and to main prospective non-EU inbound tourist markets.

51 Revenue to authorise Shannon Chamber to certify Certificates of Origin.


10.4Allrecommendations(inorderofoccurrenceinreport)

1 Announce separation without delay and formally separate Shannon Airport from DAA by 31 December 2012.

2 Adopt a phased process to enable the resolution of Shannon Development restructuring issues, with airport separation occurring by year-end 2012 followed by the merger with a restructured Shannon Development on 1 July 2013.

3 Establish the new entity and recruit a CEO.

4 Reconstitute the Shannon Airport Authority board without delay.

5 Shannon Airport management should keep under review from an overall cost benefit perspective the specific costs and revenues associated with 24/7/365 operation, over and above operation in normal commercial hours.

6 Shannon Airport should evaluate ways to differentiate itself positively from competing airports in the eyes of its passengers and potential passengers.

7 Shannon Airport should evaluate its business processes and practices for their appropriateness and where needed should develop new processes tailored to its new requirements with a focus on productivity and competitiveness.

8 Shannon should keep its commercial revenue strategy and commercial unit revenues under review with a view to learning from best practice and considerably enhancing commercial revenue and overall profit per passenger.

9 Shannon should seek to attract additional short-haul traffic and revenue through appropriate incentive deals.

10 Shannon should continue to develop its long-haul terminal traffic, chiefly in the North American market.

11 Shannon should draw on the Department of Transport, Tourism and Sport’s willingness to negotiate new Irish bilateral Air Services Agreements, and to include fifth-freedom rights, in order to develop additional long-haul airline service opportunities.

12 Shannon should aggressively market existing fifth-freedom opportunities for long-haul transit traffic.

13 Update and validate business case for constructing a modern cargo terminal with cold-chain capability at Shannon, preferably in partnership with a specialist company.

14 A focused and targeted marketing campaign to key cargo carriers should be undertaken by the new entity.

15 Continue to target high-added value MRO and MRO-related activities: lease transition, CAMO/technical document support

16 Develop plan to roll out hangars and other infrastructure rapidly in response to specific tenant demand.

17 Develop plan for dedicated parking, and explore potential for entering into “preferred supplier” contracts with lessors and airlines for parking.

18 Work to attract a design or completion centre for a non-European aircraft manufacturer targeting the European market.

19 Market Shannon as a location for pilot training organisations focussing on innovative (e.g. MPL) and niche approaches to training delivery (efforts are already underway)

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20 Pursue complementary opportunities for technical and ATC training as well as for other aviation-industry education provision.

21 Explore the possibility for College Ireland or a successor body, to be based in Shannon, to provide co-ordination and marketing support for the activities of Irish aviation training SMEs.

22 Target additional industrial placements for local universities with key aerospace companies and OEMs worldwide.

23 Specific academic and training courses focusing on composites should be developed by UL, LIT and other institutions.

24 Explore potential for further dedicated aviation/tourism academic research infrastructure supported by European funding.

25 The Department of Education should implement the amalgamation of Shannon College of Hotel Management with NUI Galway as soon as possible.

26 Pursue software development for the aviation industry as a key sector.

27 Support innovative projects and research in aviation finance in collaboration with local companies and educational institutions.

28 Ireland should move to full (equivalent to “Alternative A”) adoption of the Cape Town Treaty without delay.

29 Examine the potential for specific incentives to attract international business to issue EETCs in Ireland, for example through a targeted exemption from withholding tax.

30 Evaluate the feasibility of establishing an Irish corporate aircraft registry and the business case for doing so.

31 Promote Shannon’s potential for corporate/private aircraft MRO and completion facilities to this sector.

32 Explore the feasibility of enhancing Shannon’s corporate and private aircraft facilities, including the construction of dedicated terminal or hangar facilities with private investment.

33 Explore the feasibility of establishing a Shannon-based commercial consultancy arm of the Irish Aviation Authority, providing regulatory compliance assistance and other consulting services to international clients.

34 Market Shannon as a potential base to specialist operators, on the basis of preferential landing and property charges for based operators.

35 Establish a small working group to evaluate and progress plans for a National Aviation Museum at Shannon.

36 Establish a small working group to plan and organise a 2013 Shannon aviation conference targeting the Irish aviation-industry diaspora.

37 Encourage start-ups and SMEs through provision of incubation space and/or high-potential start-up programmes such as those offered by Enterprise Ireland.

38 Facilitate maximum feasible incentive package to underpin success of IASC in internationally competitive arena.

39 Evaluate scope to increase airside land area by extending airfield boundary into existing SFZ land.

40 The new entity should seek to evaluate and segregate its property portfolio into those assets which it sees as central to achievement of its broad objectives and those which are not.

41 While the new entity may seek to maximise the returns from its Shannon property portfolio taking into account market opportunities, it should generally make decisions related to its property assets which are consistent with the achievement of its objectives in the broadest sense.


42 Decisions on the letting, sale or disposition of the Shannon property portfolio assets should have regard to the wider economic impact and should take into account not just the net rents or the net sales proceeds but also the wider benefit which would accrue to the new entity and the Exchequer.

43 The new entity should as far as possible seek to manage the non-Shannon properties on an ongoing basis or dispose of non-Shannon property assets, taking into account its assessment of the market and seeking to achieve the highest net present value for those properties at the time of sale.

44 Upon the creation of the new entity and prior to the merger with a restructured Shannon Development, Shannon Development should provide a covenant to the new entity in respect of SD assets relating to the pre-merger period. In addition, during this period the new entity should be able to make recommendations to the board of SD to enter into particular property related transactions consistent with the objectives of the new entity.

45 DoECLG and Bord Pleanála to review determination that Shannon Airport falls within Seventh Schedule of Planning and Development (Strategic Infrastructure) Act 2006.

46 Shannon Airport Authority should work with Clare County Council to identify and agree specific areas of airport land bank for specific categories of development, and should evaluate the feasibility of applying for planning permission.

47 That consideration be given to the OPW being designated as the party responsible for any works or for implementing any recommendations which arise out of the Shannon CFRAMS study.

48 Clare County Council to evaluate the feasibility of putting in place a programme of rates relief and reviewing possible alleviation of development contributions as an incentive mechanism for new enterprises.

49 Explore potential for extension of N19 dual carriageway road into airport.

50 Review and simplify visa process for non-EU visitors, with particular reference to business visas and to main prospective non-EU inbound tourist markets.

51 Revenue to authorise Shannon Chamber to certify Certificates of Origin.

52 Urgently complete transition plan for Shannon Development.

10.5Nextsteps

The current state of uncertainty, in which the decision in principle to separate Shannon has been announced but the date for that separation is not yet known, is untenable. Momentum and goodwill will be lost if separation does not proceed quickly, and the ability of the airport to grow its passenger traffic and to win new business is contingent on the commercial freedom associated with separation.

The suggested next steps are as follows:

1 Reconstitute Shannon Airport Authority Board

2 Appoint CEO of new entity

3 Finalise incentives

4 Agree operating framework with other agencies (IDA, EI, Fáilte Ireland)

5 Government decision November 2012

6 Launch IASC as soon as possible.

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11

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Shannon Airport is a major economic driver for the Midwest Region, and an International Aviation Services Centre would transform Shannon into an economic driver not merely for the region but for the country. The Task Force is convinced that a real and substantial opportunity exists to develop an aviation centre of excellence in Shannon, drawing on Shannon’s and Ireland’s existing assets to create a globally-recognised aviation cluster combining established activities with innovative new projects. Such a Centre would generate substantial employment, economic activity and Exchequer returns, would enhance Ireland’s international reputation as a location for aviation industry expertise, would underpin the development of traffic at Shannon Airport, and would reinforce the attractiveness of Ireland as a location for the aircraft leasing industry.

The foundations for such a centre already exist at Shannon: a range of established aviation services firms already employ about 1,600 people in the area. Shannon also enjoys a range of advantages which competing aviation clusters worldwide may lack: ample land, an uncongested airport and airspace, availability of English-speaking skilled labour, a stable political environment, and strong relationships with the aircraft leasing industry. Ultimately, the success of such a Centre will depend not only on these assets and on sound and visionary management but also on an attractive incentive programme capable of convincing aviation-related businesses from all over the world to set up operations in Shannon.

It is the conviction of the Task Force that an independent Shannon entity can be financially and commercially successful.

The separation of Shannon Airport from the DAA is the single most important enabler of this future success. A failure to move forward with separation will lead inexorably to the further decline of the airport and the surrounding region. This need not happen. The opportunity now exists not only to safeguard the future of Shannon Airport, but also to create a truly globally significant international aviation services centre, which will be an economic driver for the Midwest region and for the country as a whole and which has the potential to create thousands of new jobs.

11 Conclusion


Appendix

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AppendixATaskForceMembers

Rose Hynes (Chairman) Chairman, Bord Gáis Éireann

John Fearon Assistant Secretary, Department of Transport, Tourism and Sport

Dermot Curran Assistant Secretary, Department of Jobs, Enterprise and Innovation

Derek Moran Department of Finance

Declan KeanePartner, KPMG, previously chaired Inter-Departmental Mortgage Arrears Group

Eamonn Brennan Chief Executive, Irish Aviation Authority

Ed HansomAviation consultant with SMBC Aviation Capital, and former CFO, GPA Group Plc

Pat DaltonCFO One51, member of the Board of the Irish Aviation Authority and former member of the Board of the Cork Airport Authority

Michael Tiernan Businessman in the Mid-West Region

Dr Alan AhearneLecturer in Economics, NUI Galway, member of the Board of the Central Bank of Ireland, and former adviser Department of Finance

John McMahon Forum 21

David O’Flynn Chairman & Chief Executive, Tolisons Group

Brian McLoghlin Legal and Aviation consultant, former Group Company Secretary GPA

Dr Vincent Cunnane CEO, Shannon Development

Mary Considine Director, Shannon Airport

Tommy Fanning Manager, Engineering Division, IDA

Neil O’Sullivan Manager, Engineering Markets Department, Enterprise Ireland

The Chairman and the Task Force wish to acknowledge the significant contributions to their work made by:

Paddy Campbell Department of Transport, Tourism and Sport

Stephen Curran Department of Jobs, Enterprise and Innovation

Mary Dunning Department of Transport, Tourism and Sport

Brenda McVeigh Department of Finance

12 November 2012

ShannonAviation Business Development Task Force Final Report

Documents

Shannon - Home | DTTAS Department of Transport, Tourism ... · PDF fileShannon, as outlined in this report, is conservatively projected to create and maintain 3,000-3,500 new direct