Running a regional airport is challenging; running a small regional airport is downright precarious.

This was my overall takeaway from chairing ACI EUROPE 's 15th Regional Airports Conference in Dubrovnik, hosted by Viktor Sober and his team at Dubrovnik Airport .

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While the total European aviation market is set to surpass 2019’s peak this year, the picture is far from homogenous, with some larger regional airports serving popular tourist destinations far outperforming the average and the smallest regional airports (below 1 million passengers a year) still almost 40% below pre-COVID levels. Why this difference? Several factors point towards an explanation, including:

-????????????? Airline consolidation and the ongoing shift of intra-European capacity from network carriers to LCCs, with some previous network connections no longer in place

-?????????????Aircraft availability challenges resulting in a need to make tactical network changes, retrenching from smaller regional markets

-????????????? Typical hierarchy of recovery – similar to trends in other downturns where airline prioritise routes and airports with the largest, highest yielding markets to minimise load factor and yield risk

The implications for the next several years for smaller regional airports are significant; caught as they are between slow and fragile revenue growth, and rapidly growing operating and capital costs. With additional costs potentially on the horizon as Fit for 55 measures start to take effect.

As such, the extension of operating aid exceptions for airports with fewer than 3 million passengers until 2027, and the possibility of further extensions or revision on the table, ?is seen by many as a welcome and necessary lifeline. Henrik Morch from DG Comp gave a clear call to action for the regional airport community to engage with the Commission and to submit notifications of operating aid, in order to build a sufficient evidence base for the case for further support. Nicole Robins from Oxera Consulting LLP unveiled the latest ACI Europe study on the financial viability of regional airports, providing valuable data points and evidence.

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It wasn’t all doom and gloom however, with the possibility of new technologies, including electric aviation Heart Aerospace , EVIA AERO GmbH and hydrogen Groningen Airport Eelde showing the possibilities and the chance for regional airports to be leaders, innovators and demonstrate what zero emission aviation can look like in practice.

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And of course we couldn’t avoid the topic of SAF, and I was pleased to get some candid and insightful perspectives from Steven Fitzgerald , Simon Dreschel and Alexis Chausteur , helping to tease out the implications of #ReFuelEU for regional airports. Questions of availability of supply were rebutted, confidently, for at least the initial phase of the mandate, although it is likely to be the case that supply will remain concentrated at a handful of airports, with obligated fuel suppliers taking advantage of the flexibility mechanism available for the first ten years. One way or another the cost of new blending infrastructure and new fuel sources will find their way to higher fares, which is increasingly accepted as the inevitable price of meeting the industry’s net zero obligations.

Day 2 continues the discussions, with sessions on seasonality, collaboration, revenue diversification, innovation and attracting talent.