Loganair profits soar as isles fares increase
Loganair increased its profits by 59 per cent in the year to March 2025 while paying an £8 million dividend to its shareholders, amidst mounting protests from the islands about “eye-watering” fares.
Despite carrying fewer passengers and reducing its turnover compared to the previous year, the regional airline sharply increased its profits to £11 million. Its annual report attributed this to “a transformative shift to deliver stable operations, fewer delays and a reduction in the number of cancellations”.
The report says that the airline “successfully navigated away from the older Saab type” and is “positioning itself for the future around the most advanced turboprop aircraft available in the market”.
However, the report makes no reference to fares or the mounting controversy surrounding them. It is estimated that Loganair fares on island routes increased by 17 per cent over the same period.
In the light of the profits hike, the chairman of Comhairle nan Eilean’s transportation committee and also of HITRANS, Uisdean Robertson, repeated the call for a Holyrood committee to examine the fares structure and factors which have pushed them up over the past two years.
Councillor Roberton said: “I get more incoming complaints about this issue now than about the ferries – and that’s saying something. Even with ADS, people are finding it unaffordable to fly, particularly at short notice.
“Loganair have said previously that they are prepared to work with us to find solutions but it is pretty obvious that a rise in profits is not unrelated to increases in fares. These are lifeline services and the Scottish Parliament and Government need to look at how they are going to be protected”.
The Gazette revealed recently that Loganair have introduced further unannounced “stealth” increases from the start of the New Year including a rise in a fuel surcharge which was supposed to have disappeared altogether as the oil price fell.
The surcharge was introduced in March 2022 when oil prices were high and Loganair promised to remove it when the price of Brent oil fell below $85 a barrel – which it has not reached this year. It currently stands at $62 as Loganair increase the surcharge, rather than removing it, netting an additional £1.5 million a year.
The Liberal Democrat MSP for Orkney, Liam McArthur, met with Loganair on Monday and called on the company to reduce fares “across the year” and not to proceed with the planned increase in fuel surcharge.
HITRANS will meet with the company next week. They have also produced a report on Public Service Obligations – PSOs - which draws comparisons with Norway and Greece. PSOs, which give the government a direct say in issues like fares and scheduling, are widely used in these countries but apply to only three routes in Scotland – Barra, Tiree and Campbeltown.
The report, which will be more fully reported next week, states: “For Scotland, these cases demonstrate that PSOs are strategic tools of inclusion, not short-term subsidies. A unified framework— integrating current Scottish Government and local authority schemes—would deliver affordability, environmental progress, and national equity”.