STATES-OWNED airline Aurigny has lost £560,000 on the Guernsey-Jersey route this year due to the introduction of competition by rival airline Rockhopper. The claim that its arrival had split traffic and revenue was made yesterday by the operator’s managing director, Malcolm Hart, as part of the airline’s opposition to a licence application by Rockhopper to launch a service between Alderney and Guernsey from October.

‘It will weaken our company and will not provide any benefit to the consumer,’ he said, dismissing any suggestion that his company feared competition.

Rockhopper chief executive Noel Hayes told a Commerce and Employment Department hearing that his company was ‘alive and kicking’ and that Aurigny opposed anything it did.

The States of Alderney has already granted it a licence for the lifeline route, which carries 30,000 passengers per year, and the island wants two carriers, he said.

Aurigny does not maintain enough capacity on this route to cope with present volumes, passengers are often forced to travel at inconvenient times and nearly a third of flights have no seats available, said Mr Hayes.

He said that Aurigny’s previous concerns about structures and timetables on other routes had not materialised.

Mr Hayes dismissed claims that Rockhopper’s fares had a ‘lucky dip’ element and complained that Aurigny was struggling to meet current demand for Healthspan’s leisure product offering let alone its expanded plans.

‘Unfortunately, you are running the flights at the wrong time,’ he told Aurigny. ‘I would expect you to lose some market share to us.’

But Aurigny hit back.

‘Our industry is a cut-throat one and there is no personal animosity at all against Rockhopper,’ Mr Hart said minutes after the hearing.

‘I’m doing the best I can for my business and I would expect them to do the best for theirs,’ he said.

‘I have the best long-term interests of the consumer to deal with and that is the scenario that has been in place for 37 years – and that is for Aurigny to continue on its own.

‘Competition has come in from Rockhopper from Alderney to the south coast [Bournemouth and Southampton] and Guernsey to Jersey and there has not been any growth in the market at all. All it has done is split revenues between the two operators,’ said Mr Hart.

‘We have lost £560,000 this year alone on the Guernsey-Jersey route purely as a result of competition without market growth.’

Mr Hayes rubbished claims that Rockhopper had seen no market growth and said he was quietly confident of being granted a licence and was tired of the same old arguments from Aurigny.

The company wants to provide a twice-daily service – morning and evening – between the islands.

‘The people of Alderney have requested competition on the route and we are confident their wishes and desires will be met,’ he said.

‘It is not about slashing prices. There is a demand that we can satisfy. Yes, we will take some passengers from Aurigny, but we will also grow the market – it’s not two companies fighting for the same number of passengers. We think we can expand the market quite substantially with Healthspan’s support,’ said Mr Hayes.

And he said Alderney was already regarded as a First-World island with a Third-World postal service.

A further application to operate a cargo and passenger service between Alderney and Guernsey was made by European Executive Ltd.

Operations manager Mike Pettit said the company’s medium- to long-term ambitions were to operate a comprehensive year-round service with turbine aircraft from Shoreham to the Channel Islands on a triangulated basis on top of its service between the south coast and Alderney. ‘We welcome an open-skies situation,’ he said.

Aurigny opposed this application as well.

A decision on both licence applications is likely to be made by the department shortly.

The matter could go to a judicial review.