The decline of Barajas

Barajas, Spain's flagship airport, is going through an unprecedented slump, perhaps the deepest among major European hubs. During the month of August, the tourist season par excellence, the Madrid airport lost 22 percent of its passengers with respect to August of last year; and in September it saw another decline, this time of 11.5 percent. The airport's new terminal, T-4, which was recently built and is one of the most advanced in Europe, was inaugurated in 2006 at a cost of six billion euros. But in spite of this advantage, the airport's business volume has entered into a downward trend, which contrasts with the moderately positive behavior of Barcelona-El Prat. In fact, during the month of August, the Catalan airport surpassed Madrid in terms of volume of traffic for the first time, though in September the capital recovered its lead over El Prat by a narrow margin.

The problem of Barajas and its massive T-4 has very precise causes. One of the most notable is the decline of tourism in Madrid. The capital has been adversely affected by the drop in business visitors, while no such drop has been experienced by Spain's traditional sun-and-sand destinations, which are served by the airports on the Mediterranean coast. The crisis in business travel is, of course, influenced by the recession, but also by a lack of investment in infrastructure and services.

But the gradual loss of importance of Barajas (a fall in passenger volume of 20 percent over the last two years) is due also to structural factors, which the government and the airport administrative agency Aena are obliged to consider. One of these is airport fees for airlines. These rates have risen in Barajas by 113 percent — compared to 108 in El Prat — in the last three years, exactly the time period in which the slump in passenger volume in Madrid began to accelerate, with a 7.7-percent fall in tourist numbers so far this year. Moreover, the former national flag carrier Iberia, recently subject to an intense restructuring process, operates in T-4. In the air-travel business right now, the low-cost airlines constitute the most successful model for maintaining — and perhaps moderately raising — passenger volume. Iberia does not compete in this sphere, and the shrinkage of its traffic, in terms of lines and passengers, is being felt in T-4. Another factor in the decline can be identified: Barajas has no policy for the promotion of its image, something that has benefited other airports.

It is not a good strategy to blame it all on the recession, and to trust that future recovery will revitalize the Madrid airport. In the future the economic, tourist and commercial flows will be different, and the utility of major airport infrastructure may be compromised. The Barajas crisis is important enough for the government and Aena to take a serious look at their airport policy, and to reconsider the new role played by low-cost companies in air travel. A fall of 20 percent in passenger volume over the last two years suggests that, if nothing is done, Barajas may become a half-empty shell in just a decade.