Press speculation that BAA will sell Glasgow Airport

13.08.08

Glasgow Airport is 'on the brink of a sell-off', according to press reports. The Herald newspaper says that BAA's owners, Ferrovial, are looking at plans to put the airport on the market this month in a bid to avoid a full-scale break-up of the UK airports operator being imposed by UK watchdogs, and to choose themselves which Scottish airport they sell.

Earlier this year, the Competition Commission warned that the BAA monopoly in Scotland and the south-east of England may be hurting customers (passengers and airlines). Press reports suggested that the commission was now sure BAA's control of the seven British airports, including Aberdeen, Glasgow and Edinburgh, was harmful to the market. That, the Financial Times says, makes enforced sell-offs more likely.

Unnamed 'legal sources' have now been cited saying the next round of findings - expected in the next 2 weeks - will be a step towards an order for BAA to sell an airport in Scotland and an airport in England. Officials from rival airport operators are reported to be have been consulted by the Commission on what this wider airport ownership would do for the industry.

Any sale would end the near monopoly BAA enjoys in Scotland. Airlines argue competition between Glasgow and Edinburgh airports could bring down fares to and from Scotland and have urged competition authorities to force BAA to sell one or the other. Some aviation experts, and BAA themselves, have said that it will not as the airports do not compete with one anther for passengers.

The Herald reports that Ferrovial is eager to make its own call on which airport to sell. The newspaper says says that Spanish managers visited Glasgow and Edinburgh earlier this summer to look at the two airports. Edinburgh is now the bigger of the two and is still growing, whilst passenger numbers in Glasgow have dropped by 5% in the last year. It is particularly vulnerable to a downturn in the holiday market.

Glasgow Airport also faces more competition than Edinburgh, from low-cost rival Prestwick, and is seen as the best to sell, the newspaper reports.

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