Cruz says AENA fee hike will not derail Barcelona growth

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Vueling will achieve net growth at its Barcelona El Prat hub throughout 2012, chief executive Alex Cruz tells Flightglobal, with the availability of spare capacity following Spanair's demise comfortably outweighing the impact of higher fees at the airport.

The low-cost carrier is lobbying AENA over the doubling of charges at El Prat and Madrid Barajas airports in "continuous" top-level private meetings, he says.

But Cruz does not anticipate any revisions to the higher fee structure - implemented on 1 July 2012 - and Vueling is instead pursuing "concessions" from the airports operator over the 5%-above-RPI increases planned for the beginning of 2013 and 2014. Though a goal for the airline, Cruz admits that such provisions will be "insufficient".

"AENA has about €10 billion deficit debt. These guys are going to be looking for every possible opportunity to raise their prices," he says.

Dismissing Ryanair's announcement that it will reduce winter growth at the two Spanish airports, Cruz emphasises that both low-cost carriers will in fact see a sharp increase in net capacity following the collapse of Spanair in January 2012. Year-on-year, "about 70%" of the defunct airline's fourth quarter capacity will be shared primarily between Vueling and Ryanair, he says.

"Ryanair are smart in the way in which they tell the story, but when you actually take a look at the capacity you will see that they have more seats for sale now out of Barcelona than they did last year," he insists.

Nonetheless, Cruz admits that the higher airport fees decried by his main competitor will combine with uncertainty in the wider economy to make planning winter capacity a difficult task.

"Spain is really not that good a market right now," he concedes. "What is making us very nervous is [the challenge of] making the right decision about capacity in the fourth quarter. What is the net effect on demand going to be [after you factor in] the increase in VAT, the increase in taxes and the overall economic environment in Spain?

"I really pray that we get it right, because we could increase by one aircraft or six or nine - we need to make sure that we increase by the right amount."

Cruz is encouraged by indications that El Prat was shielded from the downturn in the second quarter, with the gateway witnessing a 7% reduction in domestic traffic compared to 11% nationally; and 12% growth in international traffic compared to a flat market at other Spanish airports. "Overall, Barcelona has grown by 4%, but of course Vueling has grown by 39%" at the base, he says.

Madrid Barajas, meanwhile, remains primarily a destination market rather than an origin market for Vueling, though the three aircraft based there will continue to provide some feeder traffic to El Prat, the chief executive adds.