Role of Aviation Sector in Latvia Development of Riga International - PowerPoint PPT Presentation

Role of Aviation Sector in Latvia Development of Riga International Airport

Riga International Airport • Built in 1974 • 100% owned by the Republic of Latvia • Operated by SJSC RIGA International Airport • Occupies an area of 650 ha • 1100 employees • 23 airlines fly to 79 destinations • ISO 9001:2008 and ISO 14001:2004 (since 25.09.2015.) • Annual turnover 49 million EUR (2015) • Aviation income 56%, non-aviation income 44% • RWY Length – 3200m, Width – 45m • Open 24/7 • CAT II (since 5.03.2015.) – allows aircraft operations in low visibility • Fire fighting CAT 8 (24h), CAT 9 (for E class cargo a/c) • Infrastructure suitable for handling of all aircraft types except A380

Aviation industry in Latvia Latvian aviation industry grew significantly during past 10 years both in passenger traffic and cargo and Latvia developed strong aviation sector relative to its size • Latvian aviation sector contributing ~3% of GDP and ~40K jobs • Latvia has developed a strong aviation sector relative to its size with 2.4 pax / inhabitant. • Riga International Airport serves as regional transfer hub. • airBaltic has strong position in Riga but both low cost and full service carriers increased their shares during last years. Low cost airlines share is about 30% and full service carriers share is 20%. • Due to periphery location of Latvia, developed aviation infrastructure is precondition for economic growth.

Periphery effect for Latvia: Air connectivity many times more useful than for WE/CEE ...driven by the fact that only 2% Direct GDP return for Latvian of EU wealth reachable by car in ... thus making air travel reach aviation higher than in other 8hrs from Riga (~40% for the effect ~20-25 times bigger for Riga countries... Central Europe) than for western/central Europe Direct-indirect multipliers (2011) Riga's air travel effect is ~20-25 times bigger than Brussels' or Prague's x2 x2.5 x6 x8 x47 Riga 1.82 2.0% 1.79 0.4% Prague 1.73 1.72 1.65 99% 99% 99% 99% 95% 9.3% 40.3% 56% 40% 17% 2% 12% Purchasing power ( M € ): Darker areas represent higher absolute wealth Brussels Budapest Riga Prague Warsaw Driving time: 4 hours 8 hours % of EU wealth by car in 8 hours % of European purchasing power reachable after 4 or 8 hours by car % of EU wealth by plane in 4 hours

Riga International Airport compared to its closest European hubs by aircraft movements (2015) Vilnius 39289 Tallinn 41513 Riga 68078 Helsinki 115263 Warsaw 124000 St. Petersburg 137000 Stockholm 217000 Vienna 231000 Berlin 240000 Copenhagen 252000 Riga International Airport compared to its closest European hubs by destination numbers (2015) Tallinn 36 Vilnius 54 Warsaw 85 Riga 89 Helsinki 130 Copenhagen 157 St. Petersburg 164 Berlin 165 Vienna 172 Stockholm 181

TOP10 destinations during last 5 years Serviced passengers and weekly frequencies in Year 2015 60 00 00 50 45 44 45 49 91 10 50 00 00 37 36 40 34 37 19 09 32 35 40 00 00 29 29 34 77 30 23 22 28 20 34 30 00 00 25 21 25 04 22 20 20 64 50 18 55 26 20 00 00 16 12 83 15 96 41 14 72 10 15 10 10 00 00 5 0 0 2011 2012 2013 2014 2015 Frekvenču skaits

Three main strategic directions for Latvian aviation sector discussed during Q1, 2015 Maintain/improve 0 1 2 Baseline: Grow leisure connectivity to support No action (current trend) traffic volume high-value traffic Loss of airBaltic and transfer Development of the leisure Development of the passengers leading to loss of traffic (inbound and outbound) connectivity in Riga to enable Economic half of the economic impact of leading to an increase of the the trade and the investments in impact aviation local spending in the touristic addition of the leisure traffic sector • Reduction of the number of • Development of daily services to • Reduction of the number of destinations and frequencies in the main European capitals Connectivity destinations and frequencies in the next few years • Improvement of the frequencies • Development of the capacities the next few years and the quality of schedule on touristic destinations • Promote Latvia as a touristic • Promote Latvia as a business • No specific action State destination destination Key prerequisites • Improve tourism infrastructure • Support airBaltic in transition • No specific action short-term, • Create favorable conditions to • Create conditions to support Airport forced to create favorable attract LCCs (tariff structure, regional hub conditions for LCCs mid-term airport infrastructure, marketing) • Transition into a very efficient • Increase short-term yields and • Increase short-term yields and airBaltic carrier gradually phase down gradually phase down • Find a strategic partner

Passenger traffic development: 6,8M in 2036 2036: Sustainable growth of the traffic and increase of GDP growth ~2%/year inbound passengers Leader position in Baltics Inhabitants travelling intensity growth Decrease of inhabitants: Latvia- 1,6m Baltics - 5,1m (2030) # PAX (M) Geopolitical situation in Russia Competitors 4,0 3,6 3,5 Decrease of transit in the short-haul market 8 3,1 6,8 Country pax/ inhabitants (2014) 7 2,8 6 5,3 2,4 2,4 2,4 2,3 2,1 2,0 1,8 5,16 5 4 1,5 1,2 1,1 0,9 3 2 0,6 0,5 0,5 1 25% 2 … 23% - LV 2030 UK NL AT ES LV BE PT DE FR GR IT EE LT CZ HU BG RO PL FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY29 FY30 FY31 FY32 FY33 FY34 FY35 FY36 Transfer Direct PAX total

INFRASTRUCTURE DEVELOPMENT

Riga International Airport infrastructure • The airport airfield infrastructure (runway, new taxiways, aprons) upgrade project was compleated last year • Riga International Airport terminal capacity is limited currently, but ongoing investments will resolve the issue.

Riga International Airport infrastructure development project 2013 – 2015 Project value EUR 93 million Enforcement New rapid RWY surface New of RWY strip exit TWY renovation and CAT II TWY installations New deicing platform New deicing platform Renovation of apron surface New apron Waste Vehicle sorting washing hangar hangar

Terminal expansion 2015 - 2016 I part – additional 3 departure gates, new - commercial premises and extended non- Schengen arrival hall by September of 2015. Investments EUR 15,7 million. II part – 19 Schengen/ non – Schengen departure - sectors, 7 walking stands and 3 new passenger boarding bridges, new commercial premises by Autumn of 2016. Investments EUR 9,1 million

Riga International Airport Investment plan for 2016 - 2036 Total value EUR 416 million. Investments, mil. EUR 140 121 108 107 120 100 107 80 98 80 90 60 60 40 16 14 12 20 6 6 4 2 1 0 2016-2020 2021-2025 2026-2030 2031-2036 Infrastructure Security IT Total

Thank You! Andris Liepiņš Chairman of the Board

Ireland traffic development 2011-2015 Regular traffic, Dublin route 14 00 00 9 00 8 14 7 60 8 00 7 41 12 00 00 6 93 6 55 7 00 10 00 00 6 00 8 00 00 5 00 12 77 82 12 25 03 4 00 6 00 00 11 62 80 11 52 67 10 77 47 3 00 2 32 4 00 00 2 00 4 09 74 2 00 00 1 00 0 0 2011 2012 2013 2014 2015 2016(jan-apr) Passengers Flights

Norway traffic development 2011-2015 Regular traffic, Routes: Oslo/Gardermoen, Oslo/Torp, Oslo/Rygge, Bergen, Stavanger and Alesund 45 00 00 50 00 45 76 45 29 42 62 45 00 40 00 00 39 64 40 00 35 00 00 38 42 35 00 30 00 00 30 00 25 00 00 25 00 20 00 00 38 33 21 37 19 11 36 35 66 36 35 29 20 00 34 51 06 15 00 00 15 00 1076 10 00 00 10 00 11 26 64 5 00 00 5 00 0 0 2011 2012 2013 2014 2015 2016 Passengers Flights

Most Popular Destinations - Countries Arriving and Departing Passengers – January – December 2015/2014 90 00 00 80 00 00 70 00 00 60 00 00 50 00 00 40 00 00 30 00 00 20 00 00 10 00 00 0 Russian Great Sweden Lithuani Denmark Belgium Netherla Germany Federati Norway Finland Estonia Italy France Turkey Ireland Britain a nds on 2015 77 05 38 72 80 89 45 72 14 38 56 86 27 11 34 21 47 57 19 46 42 18 70 27 18 64 68 17 75 74 16 06 22 15 94 36 15 88 25 15 66 73 12 78 52 2014 66 54 04 61 40 84 52 64 08 34 69 86 27 30 19 17 93 19 20 34 25 18 51 58 20 78 58 17 64 48 8 22 44 16 09 44 15 85 80 17 01 50 11 53 02