Irish and US airlines are appealing to the incoming government to scrap an “outdated” cap on passenger numbers at Dublin airport that has made Ireland the only major European country where seat capacity is shrinking.
The long-running dispute caused by local planning restrictions has spread to Europe’s top court, with the airline industry warning that it would harm Ireland’s economic growth.
While the legal challenges from local and US carriers have temporarily staved off the Irish aviation authorities’ orders to comply with the cap for this year’s summer season, the battle highlights the rising tensions between local worries over the impact of airports and wider economic and industrial growth.
In November 2023, the Dutch government shelved plans to cut flights at Schiphol airport, after pressure from airlines, the EU and the US.
Some airlines have increased capacity thanks to the temporary stay of the cap. US carrier United Airlines plans to boost flights to Dublin for the summer 2025 season, starting at the end of March.
However, capacity restrictions for the current winter season remain in force and the long-term uncertainty over the cap has led to the sector turning to Fianna Fáil and Fine Gael, the two political parties expected to form a coalition with independents this month. Both parties promised to get rid of the cap during their election campaigns.
Donal Moriarty, chief corporate affairs officer at Aer Lingus, appealed for the new government to “urgently” pass legislation permitting a temporary rise in passenger numbers “to allow airlines and the airport to plan for future investments and growth”.
Airlines For America, a lobby group including American Airlines, JetBlue, Delta and United, has called on Fianna Fáil and Fine Gael to keep the issue “at the forefront of the new government’s agenda”.
Local planning authorities capped annual passenger numbers at Ireland’s biggest airport at 32mn in 2007 amid road traffic constraints. DAA, the airport operator, said that level was breached for the first time last month.
Dublin airport expects to have handled 33.5mn passengers in 2024, but without a cap, it could hit 37mn in 2025, including some 2mn passengers in transit, and 50mn passengers a year by 2035, DAA chief executive Kenny Jacobs said.
Ireland is home to Ryanair, Europe’s biggest airline as well as a major aircraft leasing industry, but it is currently the only one of the top 20 European markets for air travel where seat numbers are set to drop in the first quarter 2025.
Despite aircraft delivery delays and supply chain problems, seat capacity in leading European countries will grow 6.5 per cent from the year before, compared with Ireland’s 3.3 per cent decline, aviation analysts Cirium forecast.
DAA applied to the local county council in December 2023 to increase the cap to 40mn a year and to invest €2.4bn in infrastructure and upgrades.
While officials consider that, the operator applied to the council last month to increase passenger numbers to 36mn — a decision it hopes can be taken swiftly since no additional infrastructure is needed.
Ireland’s outgoing government long argued that it could not over-rule planners. But Jacobs was hopeful that the new government would honour the main parties’ manifesto pledges.
Government intervention could mean that lengthy legal action challenging the cap, which is now under way, would no longer be necessary, airlines say.
Ireland’s High Court in December asked the European Court of Justice to clarify certain elements of the airport cap “given the centrality of the EU law measures involved”. The ECJ’s clarification, which is expected to take at least a year to two years, will be then be referred back to the High Court.
Pending that decision, the High Court put capacity cuts for summer 2025, ordered by the Irish Aviation Authority, on hold.
Michael O’Leary, Ryanair chief executive, said the length of the ECJ’s deliberations would mean the cap would probably not be enforced for winter 2025 or summer 2026 either — “so we can grow”.
United has already announced it will double flights to Washington to twice a day this summer from Dublin and fly a Dreamliner to Chicago to boost capacity.
Jacobs has warned the cap could cost 1,000 aviation jobs and €500mn in tourist spend and investment, harming Ireland’s booming economy and image as a major investment destination for global tech and pharma.
He said he expected that the ECJ would rule to protect an “Open Skies” accord granting EU and US airlines access to all transatlantic routes, given Donald Trump’s return to the White House.
“The Americans are very, very animated on this and they’re saying ‘whoa, whoa, whoa, we have Open Skies — that’s sacred. You can’t have local things get in the way of that’,” Jacobs said in an interview.
He contrasted Ireland’s cap with Saudi Arabia, which has been selected to host the 2034 football World Cup, and where DAA has two airport contracts and provides consultancy services to a third. Saudi Arabia plans to treble the current 130mn passengers at its 29 airports by 2030.
Ryanair’s O’Leary said he was “very confident” the cap would be scrapped. “The legal advice is that it’s in direct contravention to freedom of movement,” he told the Financial Times.
With the stay on the cap in place for this summer, “there will be growth,” Jacobs said. “I think there’ll be an additional 1mn passengers than summer ’24 — and then winter ’25 remains to be seen.”