Tuesday, March 1, 2016

The Zweibrucken Airport Story

Over the past two decades.....various state governments in Germany have quietly funded up renovation and upgrade projects for local airports.  If you asked folks in each region about it.....they'd tell you where the airport was located and give you some history.  If you asked the German if they'd ever used it for transport purposes (like to fly out to Spain, or to Berlin).....they'd mostly grin and say 'no'.  There in....lies an issue which has developed....tons of tax money spent and no usage.

This week, SWR (the Pfalz state-run network) did a piece on the old Zweibrucken Airport....which was the old US Air Force base, and when it was turned over.....it was converted into a regional airport.

When the base closed in 1991.....locals got state money and by 1993....the airport opened.  They had one major thing going for them.....it was a 8,700-foot runway.

Ryan Air (the discount airlines) tried to be a regular user of it.....but they simply didn't see the numbers to stay around (that lasted roughly one single year).

Since 2010, things have been mostly negative over profits.  Some vacation airlines used the airport, and at least in 2012.....they had around 240,000 people pass through (that means 120,000 went somewhere, and came back through the airport.....if you were doing the numbers).  That's not really enough to sustain anything.

So, the airport got sold off.  What the local Taxpayer Association will say is that the airport in terms of real value.....was worth 28.4 million Euro.  The sale?  The state got roughly four million.  Yeah....do the math but it was a fairly poor sale.

The issue?  EU regulations dictate how much that a state can spend to sustain a non-profit type airport.  After that point, the EU says you have no choice but to sell.  Prior to this regulation (it's been around a decade).....the German state government would just keep pouring money into the pit and cover losses.

Who bought the airport? A real estate holding company called Triwo.  Triwo has been around for roughly forty years and is mostly a German family-owned operation.  They tend to buy under-performing real estate, figure out ways to maximize profits, and redraw business plans.  You can imagine.....having been around for four decades....they rarely screw up and have people who know the business.

How Triwo and the Zweibrucken Airport work?

Well, here's the thing.....the airport had tons of open property.  The company wants to use the airport mostly as a business park.  The airport itself?  No one says much but it'll likely keep some summer traffic going with a cheap take-off/land type situation for discount vacation travel companies.  Beyond that?  There is a multimedia operation for several companies in operation, and some sports/recreation operations.  The locals will say that 3,000 jobs have been created since the Americans left in the 1990s, and that's the one bright spot of the whole story.

Is the Taxpayer Association correct on the loss?  Well......yeah.  But you see.....there are literally dozens of such airports around Germany that got funding in the 1990s and renovated themselves....expecting a pay-back one day.  That pay-back never came for the great bulk (probably over 95-percent will never be successful).

One could say that watchdog type operations ought to be centered on all state and local governments, but that would stop all the frenzied spending operations that pump out money as fast as it comes in.  You'd also expect German news organizations to inspect and ask stupid questions.....but they never seem bright enough to ask any questions.

So, if you are passing through Zweibucken and see the off-ramp for the airport.....just keep driving.  It's not worth ten minutes to stop and admire a mostly non-functional airport.

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