In the black again in 2020
The third quarter has now come to a close and Cologne /Bonn Airport is taking a look back at the current business year. Passenger numbers were not as high as in the previous year, but somewhat better than expected – by the end of December, a total of 12.3 million passengers will have either taken off from or landed at the airport. Compared to last year, this represents a fall of 5%, as almost
13 million passengers travelled via Cologne/Bonn in 2018. The airport had originally reckoned with having 1 million fewer passengers in 2019. The figures in the cargo division likewise show a downturn – 825,000 tonnes of goods will have been loaded in Cologne/Bonn across the whole of 2019 (-4%).
“The German air transport sector has faced some particular challenges in the year 2019. Withdrawals from the market and consolidation measures by airlines are leading to some difficult framework conditions and, in addition to this, the global economy is still weak, resulting in a fall in demand in the freight sector across all locations. This development also has an impact on us”, says Johan Vanneste, chair of the management board of Flughafen Köln/Bonn GmbH. “However, the fact that Cologne/Bonn is able to maintain its position as an important site for air transport, despite the difficult market conditions, is shown by the engagement of new airlines at the airport – from autumn onwards, an airline with a great tradition, Alitialia, will be joining us and, in the coming year, Corendon Airlines will be hugely expanding their route network from Cologne/Bonn.”
Air transport developments and winter flight schedule
The developments of the first three quarters of 2019 are already indicating a clear trend for the year – between January and September, 9,547,000 passengers took off from or landed in Cologne/Bonn (-4%). The greatest hindrance to growth was the loss of the Eurowings long-haul route, together with the withdrawal of Condor, Laudamotion and Norwegian from Cologne/Bonn.
On the other hand, developments by easyJet, Corendon Airlines, Ryanair and Pegasus Airlines had a more positive effect on the volume of traffic and created some growth. While passengers appreciated easyJet’s shuttle service to the capital city, with 40 round trips a week to Berlin, Corendon Airlines – who opened their base in May – have become firmly established in Cologne/Bonn as a holiday airline, with 25 round trips a week to sunshine destinations in Turkey and the Mediterranean.
At the end of October, we will be changing over from the summer to the winter flight schedule. During the winter season, flights from Cologne/Bonn will be offered by 19 airlines to a total of 85 different destinations. Seven of these destinations are new – Eurowings have added Arvidsjaur (Swedish Lappland) and Pristina (Kosovo) to their programme, Ryanair will be offering flights to Bordeaux (France), Kaunas (Lithuania) and Olsztyn (Poland), and Wizz Air will now be flying to Varna in Bulgaria. A further new destination will be brought to Cologne/Bonn by a new airline – from November of this year, Alitalia will be offering daily flights from Cologne/Bonn to Milan-Linate. Alitalia – Italy’s national airline – is a member of the airline alliance SkyTeam. This means that, in addition to Star Alliance and One World, the world's third largest alliance will also now be represented at Cologne Bonn Airport.
Like the passenger division, the second pillar of Cologne/Bonn Airport, the cargo division, also reflects the overall weakened trend in the industry. 599,000 tonnes of goods were handled in the first nine months of the year, a decrease of five percent.
An extensive programme of measures to improve results
At the end of the year, we are on course for a markedly negative set of results for 2019, as was already forecast – the airport shows a loss of 19.9 million euros (2018: EUR 936,000 profit). Aside from the negative developments in the transport sector, there are also other factors that have led to this fall in profits. For example, 10 million euros alone were required for the repayment of staff costs arising through early retirement programmes and programmes allowing part-time working prior to retirement. “Our main focus is on bringing the airport back on course for success – we expect to be returning to more positive results in the coming year”, Vanneste tells us. “But achieving this will require efforts across the whole company and from all those involved.”
In order that this goal can be achieved, an extensive programme of measures to improve results has been launched in the current year. This will have an impact on all areas of the airport. In addition to measures to reduce costs, the various business divisions of the company are also implementing steps to increase revenues. Apart from the reduction in staff costs achieved through the restructuring programme carried out in 2019, results are to be improved by various means such as increasing charges and rental income.
The future of the ground handling services (BVD) continues to be a focal point. In order that the profitability of the airport can be improved, the restructuring of the BVD is still considered to be a priority issue. The BVD is running at a loss; in 2019 this will once again amount to a two-figure number in millions of euros (2018: EUR -16 million) and will be even greater than in the previous year. “It is in all of our interests to change the current loss-making situation of the BVD for the long term. Particularly in times like these, with such a turbulent market environment, we cannot afford to be making these losses, which would otherwise be to be expected”, Torsten Schrank, CEO of the airport, explains. Now it is a matter of entering into talks with the trade union verdi and the works council to find a compromise so that we can arrive at a solution which will make BVD competitive.
New shops in the terminals
This year there are several new and attractive outlets for passengers at both terminals. In the summer, the sushi restaurant “EatHappy” opened in the public area of Terminal 1. “EatHappy” are based in Cologne and are known for their shop-in-shop concepts which can be found in a number of supermarkets. Their 500th branch and first independent restaurant has been opened at Cologne Bonn Airport.
The menu offered by EsS-Bahn in Terminal 1 has also been transformed – since September, it has also included various kebab dishes, as well as Currywurst and fries.
There are also plans for two further outlets to open at the end of the year or the beginning of the coming year – Heberer’s Traditional Bakery will be opening up in the Star Walk; this will be a bakery that serves beer. And in Terminal 2, in Arrivals, passengers will be able to choose between bakery products and Turkish specialities at Cuccis.
At the beginning of 2020, there will be a further addition to the range of shops in Terminal 1 with the Italian outdoor and sportswear label Napapijri.
Refurbishment of the taxi-way and laying the foundations for the hotel.
Once again this year we have been moving ahead with some major construction projects at the airport. One of these is a mammoth project – the refurbishment of the Bravo taxi-way. With this project we are moving into the next phase of the extensive maintenance programme for the flight operations surfaces at Cologne Bonn Airport. Following the successful overhaul of the large take-off and landing runway in the past year and of the crosswind runway in 2017, it's now time to address the Bravo taxi-way. This taxi-way, which aircraft use to get to the smaller take-off and landing strip and to reach the crosswind runway, is to be completely refurbished using new concrete construction methods. The works started on 1 July. The first two sections of the construction work are to be completed by the end of 2020. The refurbishment of the entire Bravo taxi-way is scheduled to take five years.
We are also currently working towards the completion of the connecting passageway between Terminal 1 and 2. This will make it possible in future for passengers to move between the terminals on the airside without having to go through security checks again. Around 10 million euros have been invested in this project.
Good progress is also being made with the construction of the new Airport Hotel – the planning application was submitted in April, and preparatory development measures are currently being carried out. The laying of foundations is scheduled for the beginning of next year. The hotel is expected to open in 2021.
Market conditions remain difficult
In the coming year, the air transport sector will once again be confronted with difficult market conditions. European airlines are in competition with one another to a huge extent and this has an impact on the average level of revenues. Added to this are high prices for kerosene as well as bottle-necks in the capacity of air traffic control operations. Almost all airlines are under great pressure to consolidate their operations. This can be clearly seen in Cologne/Bonn – for example, Eurowings are reducing their offering in the winter season on the routes between London-Stansted, Munich and Berlin-Tegel. TAP Portugal has likewise introduced consolidation measures and is leaving Cologne/Bonn entirely this winter.
This makes it even better news that Cologne/Bonn has been able to maintain its position as an attractive location. As well as the return of an airline with a rich tradition, Alitalia, in November, the winter flight schedule is being boosted by additional flights from Ryanair and Wizz Air.
Corendon Airlines bringing a second aircraft and nine new destinations to Cologne/Bonn
In the coming summer, Corendon Airlines are set to expand their offering in Cologne/Bonn. It was only in May of this year that the airline opened their base at the airport with one Boeing 737, bringing an attractive summer flight schedule with 11 sunny destinations. Their plans for expansion will continue into 2020, with a number of exciting new destinations. Next summer the airline will be adding nine new destinations to their route network from Cologne/Bonn, including several destinations in Turkey, as well as Tel Aviv and Malta. As of next year, passengers will be able to choose from more than 50 Corendon Airlines flights a week to reach their holiday destinations from Cologne/Bonn – twice as many take-offs as in 2019.
A second Boeing 737 will also be stationed at the airport for this purpose. There will be a huge number of additional flights on some of the existing routes to summer destinations in the Mediterranean and the Canaries. For the airport, the high level of commitment being shown by the airline means an extra 500,000 passengers per year. It means that Corendon will move up to being one of the top five airlines in Cologne/Bonn.
“We are very pleased that Corendon Airlines has already become so successfully established at our airport and that they are expanding their route network from Cologne/Bonn so extensively. Our passengers are benefiting from the airline’s diverse and varied flight schedule”, says Johan Vanneste, chair of the management board of Flughafen Köln/Bonn GmbH.