Overview of London City Airport’s Financial Recovery
London City Airport (LCY), strategically located in East London near major financial districts such as Canary Wharf, has marked a significant milestone by returning to profitability for the first time since the pandemic. The year 2023 saw the airport achieve a pre-tax profit of £6.6 million, a commendable recovery from the losses incurred in the preceding years.
In 2019, the airport was thriving with a profit of £47.8 million. However, the COVID-19 pandemic severely affected the aviation sector, leading to a drastic drop in business travel. As a result, LCY faced substantial losses, amounting to £48 million in 2020 and £45.5 million in 2021. By 2022, the losses had been significantly reduced to just £1.1 million, indicating a positive trajectory towards financial stability.
Passenger Traffic and Revenue Growth in 2023
The year 2023 not only brought profitability but also an increase in passenger traffic, with numbers rising by 17% to 3.4 million. Although these figures are still below the pre-pandemic level of 5.1 million passengers in 2019, the upward trend is clear. The airport’s overall revenues also saw a significant increase, rising over 20% from £85.2 million in 2022 to £102.6 million in 2023.
Strategic Ownership and Operations
London City Airport is owned by a consortium consisting of the Alberta Investment Management Corporation, OMERS Infrastructure, Ontario Teachers’ Pension Plan, and Wren House Infrastructure Management. The airport serves as a vital hub with flights to 33 European destinations, operated by nine carriers including British Airways City Flyer and Lufthansa.
Future Expansion Plans
In August 2024, LCY received approval to increase its passenger capacity from 6.5 million to 9 million annually. This expansion will be facilitated by adding three extra flights during the first half-hour of daily operations. However, a setback occurred when the UK Government rejected the airport’s application to extend operating hours on Saturdays. Despite this, the airport’s management remains committed to enhancing service and capacity to meet growing demand.
Alison Fitzgerald, the CEO of London City Airport, expressed mixed feelings about the government’s decisions. While the increase in passenger numbers was welcomed, the rejection of extended Saturday hours was a disappointment. She emphasized that extended operating hours would have accelerated the adoption of cleaner, quieter next-generation aircraft not only on Saturdays but throughout the week, benefiting local residents and reducing environmental impact.