Teesside Airport losses set out in new report, despite Ben Houchen's claims
TVCA Cabinet asked to fund expansion for private companies
It’s the 43rd edition of The Teesside Lead. It’s a short one this week, but Sunday’s will be jam-packed, given the number of statutory meetings being held in Teesside this week.
Teesside Airport is expected to make further losses next year, according to a newly-published version of its business plan.
The publicly-owned airport was bought by Tees Valley Combined Authority in 2019 and has continued to make a loss despite over £150m in investment from the public purse. For year-ending March 2024 the airport lost £6.6m despite claims in August from mayor Ben Houchen that it had turned a profit.
Earlier this month it was revealed the airport’s holding company - itself owned by the public - lost £13.4m last year. Despite claims from Lord Houchen of success at the airport, a refreshed business plan for this year has been presented to TVCA’s Cabinet ahead of their meeting on Friday which says the airport expects to lose £4.2m next year via the EBITDA measurement it used to claim a small profit last year.
Speaking to the Local Democracy Reporting Service, Lord Houchen said: “[The EBITDA result] was a nice thing to happen, but I’m not overly shouting about it when I usually overly shout about most things that we do because I think you’ve got to take that, over a longer period of time.
“Any year in isolation is either good or bad,” he said. “Sometimes when it’s good, that’s great. But actually what you’ve got to look at is over a five or 10-year horizon. So there’s still a lot of work to do on that.”
The updated business plan for the airport is being presented to TVCA’s Cabinet to get their support for £12.5m of new funding for the airport to enable aviation tenants to expand their businesses on site.
If the grant is provided by TVCA, contractual obligations mean Draken and Willis will invest £6.5m and £10m into their operations at Teesside Airport respectively. In January Draken was awarded £173m by the UK Government.
Draken wants to build a new ‘centre of excellence’, while Willis wants a new hanger.
Meanwhile, Airbourne Colours hope TVCA will build a new hanger for them. A report to TVCA’s Cabinet says a letter of intention from the company says they also want to build a further two hangers to enable them to leave their current headquarters at East Midlands Airport.
Despite having an order book at Teesside filled “for the next 2 years”, according to the report, Airbourne Colours “do not have the capital to invest into the build” of a new hangar.
Both Airbourne and Draken apparently have contractual obligations to have their new hangars operational by the second half of 2025.
The last TVCA Cabinet meeting was only two months ago. Have these companies only just landed deals which require immediate capital investment, is Ben Houchen forcing his Cabinet’s hand, or have TVCA been dragging their heels on getting the proposal together?
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Just a little bite-sized mid-week edition this week.
Thanks as always for reading. Get in touch at teesside@thelead.uk or via Bluesky.
Leigh