Poland is in a unique position in Europe. While other European countries are contending with tensions between local communities that are hostile to any sort of airport development and governments that are trying to accommodate forecasted levels of air traffic, Poland is on the brink of adding real capacity to its air traffic system by opening two new airports.
Of course, Poland is different from many other European countries, not least of all in terms of what has been happening with air travel. Poland had been putting in place measures to open its economy for some time, but it was EU accession in May 2004 that was the catalyst for a huge increase in air travel to and from Poland. Freedom of movement for goods, labour, capital and services all had implications for scheduled and charter air services.
By 2010, the number of passengers passing through Polish airports was 20.6 million, up from 10 million just five years earlier. This was despite Poland suffering its share of economic doldrums in 2009.
EU accession gave the Polish economy a vital stimulus that has remained in place to this day. As the graph opposite shows, growth in real GDP in Poland has been a consistent three percentage points above the average for the 27 EU countries. With air traffic demand widely accepted as a link to economic growth, it is hardly surprising that Poland has seen traffic growth well above European averages.
This growth is expected to continue, with the Polish CAA forecasting that the number of passengers passing through Polish airports will continue growing at an average rate of 6.4% per annum for the next 10 years, and at 4.4% per annum thereafter until 2030. By then, the Polish market is expected to have reached around 75 million passengers.
A dynamic market
With such rapid growth has come a dramatic change in the structure of aviation in Poland. Some of the established players have struggled to keep pace with the new market dynamics, while new entrants have eagerly sought out the opportunities. The most striking difference since 2004 is the shift towards a market that is comfortable with low-cost carriers (LCCs). In 2005, LCCs carried just 33% of all scheduled traffic but now they carry 56%. Together, Ryanair and Wizz handle nearly 50% of all traffic in Poland and now both carriers rival LOT in size.
In contrast, LOT has seen its market share fall to 23%. Where LCCs have stimulated air travel through lower fares and new destinations, and seen their scheduled traffic grow by 194% since 2005, LOT’s traffic volumes have only increased by 25%.
Alongside this shift towards LCCs has been the strengthening of regional airports as they have worked with the carriers to meet the needs of the new market environment. Traffic levels at Warsaw have hardly changed, while regional airports have competed to attract new entrants to the market.
Airports such as Bydgoszcz, Gdansk, Lodz, Poznan, Rzeszow and Wroclaw have all seen passenger volumes grow by more than 200% since 2004, and in some cases by much more as Ryanair, Wizz and easyJet sought to make their mark.
Main Polish market segments
Just as the market shares of different types of carrier and the distribution of traffic by airport has changed since accession, so too has the profile of passengers. With economic growth comes higher disposable incomes and a population more at ease with the habit of taking holidays abroad. In 2010, the fastest-growing scheduled markets from Poland were Russia, Turkey and Morocco, although the UK, Spain, Germany and Italy remain the largest markets.
In the years immediately after accession, the countries which permitted Polish migrant workers – the UK, Ireland and Sweden – saw large labour flows, and LCCs responded by meeting the needs of these budget travellers with air services to those countries. As other labour markets have opened and as the Polish traveller has gained a taste for travel, the focus of LCCs has again been shifting.
New airports
It is against this backdrop of rising demand for air travel, public acceptance of regional airports and a constrained Warsaw Airport, that the environment is right for new airport development. The two new airports are scheduled to open in 2012 – Lublin, a greenfield airport development, plans to open between May and June 2012, while Modlin Airport is aiming to be open in time for the UEFA Euro 2012 football competition which starts in June of that year.
Warsaw Modlin Airport
Development of the airport at Warsaw Modlin, located on the site of a former military airfield, has not been without problems and it has taken many years to gain all the approvals and there have been numerous false starts. The airport, situated about 35km north west of Warsaw city centre, aims to complement the existing, congested Warsaw Chopin Airport, positioning itself as a regional gateway and served by low-cost carriers and charter operators.
With 24-hour operations, and the possibility of a 30-minute journey from the purpose-built on-airport railway station into Warsaw, the airport aims to combine convenience for passengers with low-cost services for the airlines that choose to operate to and from the airport. Traffic forecast for the airport, prepared by Airport Strategy and Marketing (ASM), route development consultants for Warsaw Modlin Airport, envisages five million passengers by 2021.
“This is a very exciting time for Polish aviation and the opening of the new Warsaw Modlin Airport represents a major development for not only Warsaw and the Mazowsze region but also for Poland itself. We have a clear plan and route development strategy and look forward to engaging with airline and tour operator partners in the very near future,” says Piotr Okienczyc, president of Warsaw Modlin Airport.
Lublin
The development of Lublin Airport is indicative of a region hoping to emulate the recent success of regional airports in Poland. The city of Lublin has a population of 400,000 people, and as a university town has a student population in excess of 100,000, but currently it lacks an airport. Passengers travelling by air have to endure a three-hour journey by road to reach Warsaw Airport, so the construction of Lublin Airport is a welcome development for the region. Furthermore, it is anticipated that it will be a stimulus for economic development and inbound tourism, while providing direct access for Lublin’s diaspora located overseas.
Sustainability is central to the vision for Lublin Airport. The airport’s management team is committed to creating a facility that reflects the needs of airlines while establishing routes to destinations where sufficient demand exists.
Grzegorz Muszynski, president of Lublin Airport, does not, however, underestimate the challenge of opening a new airport during a time of economic uncertainty. “The development of Lublin Airport comes at a time when airlines are scrutinising their networks in an effort to maintain profitability. We recognise this, so I can assure airlines wishing to introduce services from Lublin Airport that we will work with them to ensure that their services are both profitable and sustainable,” he says.
Lublin Airport is scheduled to open in May and June 2012 and offers opportunities for charter, low-cost and full-service airlines to destinations in Europe and beyond. Again, work undertaken by ASM suggests that by 2016 up to one million passengers could be using Lublin Airport.
As with other Polish regional airports, both Modlin Airport and Lublin Airport realise that their futures may be interwoven with the route development choices of LCCs and that their actions can influence the choices made by LCCs. Both airports benefit from having a clear sense of what their market position will be and both are working on brand messages so that consumers and business partners understand all that they can offer. As well as discussion with the various LCCs, this will mean dialogue with tour operators, sales missions to a range of airlines and keeping a careful eye on the development of a fees and charges regime.
This issue features in Routes News 2011 Issue 3
