Fifty Up: Castellón and Spain's airports

An inaugural flight was made last week. A helicopter landed at a new airport. Its occupants spent a few minutes looking around before the helicopter took off. The airport in question was that of Castellón in the Valencia region. It isn't totally accurate to say that the airport is new because it was itself inaugurated in March 2011, but forty-five months after that inauguration, the first flight - the helicopter - landed.

Of the many excesses perpetrated across Spain that only truly came to light when economic crisis engulfed the country, Castellón airport is one of the worst. It shouldn't have required public money, as the private sector was supposedly going to fund its building (a similar story to that of the disaster of Ciudad Real's airport). It has thus far cost the government in Valencia around 170 million euros, a figure that will rise to almost 200 million when a fee to be paid to the operator is factored in. This operator, the Canadian firm SNC-Lavalin, has the concession to run the airport for twenty years. It is a company which has been undergoing urgent management restructuring and establishment of corporate governance and ethics procedures. Its CEO was arrested two years ago on fraud charges.

The helicopter was able to land at the airport because the national agency for air safety, AESA, had finally granted it a licence to operate. But when the first airplanes start landing is still open to some question. Flights should start in March next year, but then flights were supposed to have started last year. They didn't, and one reason why they didn't was because the runway had to be re-built; it was too narrow. This was just one additional cost that the airport has attracted. There have been others, such as 30 million euros spent on its promotion, a sum that was revealed over two years ago. Then there is the sculpture. It cost 300,000 euros, chicken feed by comparison with some other costs, but a cost that might be added to. Will the sculpture remain? If it does, passengers, as and when they start arriving, will find a face staring out at them from the sculpture. It is the face of Carlos Fabra, ex-president of the Castellón province, who was the driving force behind the airport. Fabra started a four-year prison sentence for tax fraud on 1 December.

The airport should never have been built. A justification for it was as an alternative to Valencia's airport, which is less than an hour away to its south. But the 35,000 passengers that SNC-Lavalin believe will pass through it next year is a miniscule number when compared with over four and a half million passengers at Valencia airport in 2013. It will undoubtedly offer greater convenience for some tourists, but if, as has been said, it is expected to take fifty years to realise a return on investment, where was the wisdom? If there are indeed 35,000 passengers next year, this would place the airport in 34th place in the list of Spanish airports by passenger number (on 2013 figures). There is a vast leap in passenger numbers to the airport in 33rd position, that of El Hierro, the small island in the Canaries, which attracted almost 140,000 passengers in 2013.  

Castellón would have to be added to the network of airports operated by AENA. It would bring the total to fifty. A few of these, like Son Bonet in Palma, have limited functions or are heliports rather than airports, but mostly they are airports with genuine commercial operations and Castellón would represent an additional burden for an airport network that the national minister of development, Ana Pastor, once described as "stupid and crazy". And this stupidity and craziness is something which the partially privatised AENA is going to have to get its head around. A rationalisation of the airport network has been pretty much ruled out, and Pastor admitted almost three years ago that such a rationalisation would be complicated, but what do shareholders make of an investment represented by, according to 2012 figures, an accumulated debt of over 12,600 million euros and an accumulated loss of over 70 million, a figure that would be significantly higher were it not for the profits that Palma and Barcelona turn in?

The long-term shareholders who are to acquire a 21% stake are presumably satisfied enough with their investment, but with the government retaining a 51% stake after the 28% of shares go public - delayed until at least February next year because there was no auditor in place (there now is) - room for manoeuvre in terms of network rationalisation will be limited if non-existent because the government appears not to have the political stomach for this. Small, loss-making regional airports will remain, and Castellón will be one more to add to the list.