Doncaster Sheffield Airport is to close, owner Peel Group has confirmed.
The wind down of operations will begin at the end of October, with bosses stating how no tangible proposals have been received. It is understood around 800 jobs will be lost.
A shock review was launched in July after Peel revealed it had never been profitable, as Wizz Air pulled its South Yorkshire operations. Peel has now said that a break-even business plan cannot be identified for the foreseeable future.
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Robert Hough, chairman of Peel Airports Group, which includes Doncaster Sheffield Airport, said: “We recognise that this will come as a great disappointment to many. The intractable problem remains the fundamental and insufficient lack of current or prospective revenue streams, together with the airport’s high operating costs. Our employees have always been DSA’s greatest asset, and we are grateful to them all, past and present, for their dedication and diligence over the years. The immediate priority remains to continue engaging closely with them over the next few weeks.
“As such, DSA will now begin a formal process of consulting with team members. We will do everything we can to minimise the impact of these proposals and work closely with local authorities and agencies to support our employees through what we know will be an extremely difficult period. DSA has remained in contact with union representatives on site throughout and we are committed to ensuring they are updated through every step of this next phase.”
The company has had weekly dialogue with regional and national stakeholders, including Doncaster Council, South Yorkshire Mayoral Combined Authority and the Department for Transport with airlines and aviation users also involved. It said “none of these discussions has delivered any tangible results that have changed the board of DSA or Peel’s clear view that the airport is and will remain unviable”.
A pledge of public funding to cover operating losses for a further year was received on Friday, to allow Peel Group and South Yorkshire partners jointly explore the future potential of DSA and the GatewayEast site, however, Peel’s Board decided it “cannot responsibly accept public money for this highly uncertain process against the backdrop of an unviable, loss-making operating business”.
A suggested consortium has also yet to make an approach for the 17-year-old airport, built on the former RAF Finningley site.
Steven Underwood, chief executive of Peel Group said: “We recognise that we are living in uncertain times, and we understand that our announcement will be difficult to hear for the Doncaster and wider South Yorkshire communities in which we have worked and invested for over two decades. However, as has been seen many times before in industries undergoing structural change, although change brings uncertainty it can also bring significant opportunity.
“As the strategic review concludes, we look forward to collaborating with our partners to create a vibrant, long-term vision for GatewayEast and the airport site. We will not accept any public sector grant to cover the costs of an airport that is not viable due to its lack of adequate forward revenues and high operating costs. Accepting funds from SYMCA may postpone the inevitable for another 13 months, but it will divert funds away from services on which communities throughout South Yorkshire rely.
“Instead, we intend to continue working closely with local and national stakeholders to develop a forward-thinking strategy for the airport site, in conjunction with the £1.7 billion GatewayEast development next door, to help unlock vibrant, job-creating alternatives to ensure future growth and prosperity. We have the potential to attract cutting-edge, future-tech businesses to South Yorkshire, but only if we are able to collaborate with our local stakeholders and community in South Yorkshire.”
The decision comes just months after Doncaster was made a city as part of the Diamond Jubilee celebrations.
Beckie Hart, CBI director for Yorkshire and Humber, said: "The closure of the Doncaster-Sheffield Airport will be a serious blow for the economy in our region. Whilst we continue to hold out hope that a buyer can still be found, we must plan for other eventualities to safeguard South Yorkshire’s future prosperity.
“Our thoughts will be with those who will be put out of work. Local authorities, government and businesses will need to work hard to ensure there are opportunities out there and to retain many highly skilled individuals within the region.
“The airport has been a vital asset for firms and for jobs, with many wider economic benefits for households and businesses. In order to secure the economic future of the region, last week’s announcement of the Government’s Growth Plan provides an ideal opportunity to explore the possibly of bringing the Investment Zone initiative to Doncaster. This would attract new jobs, unlock investment and power future economic growth.
“The CBI will work with government and all stakeholders to keep attracting inward investment and create opportunities for people."
The decision not to take up the offer of loss-covering support is a mistake according to one union.
Sarah Barnes, GMB organiser, said: “Doncaster Sheffield Airport is absolutely vital to the South Yorkshire economy, providing hundreds of direct and supply chain jobs as well as an international transport hub. It’s hard to think of a better use of public money than keeping it open until a buyer can be found.
"Peel Group’s decision to close, despite the offer of help, is a narrow minded failure by bosses to see the big picture. The airports closure will be a devastating blow to workers, their families and the wider community.”
Cllr Ros Jones, Mayor of Doncaster, said: "I am dismayed and disappointed by Peel’s announcement today to close DSA. Despite a realistic financial lifeline and support from government to keep the airport open whilst a new owner/operator is secured, despite this significant offer, it is the decision of Peel to close.
"This offer would have provided certainty for staff, the airport and aviation industry at a time of economic stress. Our concerted efforts have found several significant and seriously interested parties which wanted to be part of DSA's future.
"I would urge Peel that it is not too late to do the right thing and reconsider their decision for the sake of those employees, businesses and communities directly impacted by this appalling decision."
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