15th May 2003

The States of Guernsey bought Aurigny

When British Airways announced the end of its Guernsey to Gatwick route, something had to be done. A direct air connection to London is vital for the island’s finance and tourist industries.

The BA service would end on 16 June 2003, a little over a month after the news broke, because of a couple of factors. For one thing, BA was returning the ATR 72 aircraft it used on the route to the leasing company that owned them. For another, it couldn’t justify maintaining the service using larger aircraft.

An emergency debate

The news caught the States on the hop, and it quickly scheduled a debate and vote on buying Aurigny. Taking the local airline into public ownership meant it could be funded partly through taxes, and thus its viability would be less dependent on ticket sales. This would enable the States to guarantee the continued operation of the London route.

A special sitting of the States of Deliberation was called, at which Deputies voted 32-2 in favour of the purchase. The price was set at around £5m, with a further £2m set aside to underwrite any losses.

Rivals’ concerns

The move wasn’t without its critics. Rival LeCocqs Airlink wanted assurances that Aurigny wouldn’t be given preferential treatment once it was States-owned. LeCocqs was planning an Alderney to Jersey route at the time, but put the brakes on it as soon as the States’ decision was announced.

Flybe had delivered a letter the night before the Deputies were due to sit, debate and vote on the move. It asked for a delay, explaining that it was worried the move would affect its business. Flybe said it did not want to operate on a route that competed directly with a States-owned (and thus States-subsidised) operation.

Roger Dadd, chair of the Guernsey Chamber of Commerce transport sub-committee had proposed that the States purchase the landing slots that BA was vacating – and stop there. Rather than get into the airline business itself, it could then lease them to an independent airline. Flybe said it would happily be that airline.

Aurigny is now owned 100% by a holding company called Cabernet Ltd. Cabernet is itself owned by the States of Guernsey. Formed in January 2003, its registered address is States Airport, Forest, Guernsey.