Inverness Airport is generating £120 million a year for the Highland economy according to the findings of a new economic impact study published today (Thursday 9 June 2005).

The Economic Impact of Inverness Airport report shows that the hub airport for the Highlands and Islands and the air connectivity it provides produces an annual output of £120 million and supports 2,297 full-time equivalent (FTE) jobs in the region.

Many of the economic outcomes generated by the airport accrue in the Inner Moray Firth area but the airport also provides major benefits across the Highlands in terms of inbound visitor spend and employment.

The study was commissioned by Inverness and Nairn Enterprise (INE), Highlands and Islands Enterprise (HIE) and Highlands and Islands Airports Limited (HIAL) last autumn and was produced by Reference Economic Consultants of Inverness. The airport operator and local enterprise company have worked together on a range of initiatives in recent years and are both partners in a joint venture company which plans to develop Inverness Airport Business Park on a 250-hectare site at the airport. HIAL and HIE are partners in the Scottish Executive’s Route Development Fund and work together on other strategic air transport initiatives.

The report covers in detail a range of topics including businesses based at the airport, direct and indirect employment, direct income, visitor spend and the airport’s impact on tourism in the region. Its main findings are as follows.

Spending by visitors who fly into the region totals almost £47 million. Of these expenditures, (43%) are made within the INE area, totalling just under £20 million. This is the largest share of expenditures among each of the 10 HIE LEC areas. More than half (57%) of the total spend accrues to other parts of the region. For example, the Ross and Cromarty area accounts for around £8 million and Moray, Badenoch and Strathspey for a further £6 million.

The airport has undergone rapid development in recent years with the introduction of new air routes driving passenger growth of more than 55% between 2000 and 2004. London routes accounted for 80% of the airport’s 565,000 passengers in the financial year 2004/05. Inverness is on target to handle 700,000 passengers in 2005/06 and to reach one million passengers a year by 2010.

In May 2005, HIAL, INE and Moray Estates Development Company formed Inverness Airport Business Park Limited. The joint venture company, which is supported by The Highland Council, intends to develop a high amenity business park on a 250 hectare site at the airport which could support as many as 5,000 jobs over its 30-year development period.

The report also highlights the ongoing development opportunities associated with the airport as passenger numbers and the range of air services increase. Areas identified for future expansion include:

• New scheduled air services to UK and European destinations
• New inbound charter flights from Europe
• New airport service sector employment
• Expanded freight and aviation business at the airport
• Inverness Airport Business Park

Inglis Lyon, HIAL's Managing Director, said: “Inverness airport plays a vital role in the Highland economy and the report’s findings show that it has huge potential to grow and deliver even greater benefits for the region, its communities and businesses.

“Many exciting developments are already under way and we continue to pursue new airline business that will provide more opportunities for people travelling from the region and bring more visitors into the Highlands. Inbound visitors already spend around £47 million a year here and easyJet’s routes to Belfast and Bristol which start in July will further boost this revenue stream.

“The links between the airport and sustainable economic development in the area are very strong. Effective partnerships will be fundamental to achieving our aspirations for the airport and we are committed to working in conjunction with our strategic partners to achieve the best results we can,” said Mr Lyon.

Stuart Black, INE's Chief Executive, said: “The airport is already a significant economic force in the area with 30 businesses based on the site. There are also excellent opportunities for further development, both in terms of enhanced air connectivity and airport-related business expansion. Route development is an ongoing priority for HIAL, INE and other partners but we are also keen to see businesses on the site grow, create new employment, source more goods and services within the region and achieve the wider expansion of the site through the business park joint venture.

“We want to see all these opportunities maximised and look forward to helping ensure that the airport provides even greater outputs in the years ahead. The ultimate beneficiaries of all this activity will be the people who live and work in the area, creating a prosperous and strong economic environment for the future,” said Dr Black.

The report’s findings have also been welcomed by business and public sector organisations in the region.

Councillor Sandy Park, Chairman of The Highland Council's Planning, Development, Europe and Tourism Committee, said:  “The success and growth of the airport is vitally important to the economic health of the Highlands, both for the expansion of businesses as well as for our most important tourism industry.”

Simon Cole-Hamilton, Chief Executive of Inverness Chamber of Commerce said: “Inverness Airport plays an essential role in the Inverness and Highland economies. Our livelihoods are heavily dependent on visitors coming into the area, and on our ability to access international transport hubs. This study confirms just how important the airport is as an economic generator for the area. Because of our peripheral location, our future prosperity will continue to be directly linked to air passenger and freight traffic, and we look forward to further new routes coming on stream.”

Shona McMillan, Highlands and Islands Area Manager at the Scottish Council for Development and Industry said: “The success of Inverness Airport in recent years has had a key role in the economic success of the Inverness city region and of the whole Highlands. SCDI believes that we need to go on supporting its growth.

“Highlands and Islands Enterprise will launch its new strategy for a smart, successful Highlands and Islands next week. SCDI has made the case for prioritising new direct air services from our hub airport at Inverness because the region now competes globally for trade and tourism. That is why we back moves that would help bring them about, including the planned PFI buy out and, in principle, an airport rail link,” she said.

A copy of the report can be found at the following link:

http://hial.co.uk/economic-impact-of-inverness-airport-report-june-2005.pdf

ENDS