Blue Islands (SI, Jersey) chairman Derek Coates says the Jersey-based carrier will reduce its winter season frequencies to Guernsey after the island's legislature voted last week to liberalize its air services policy.

Last week, the States of Guernsey voted 22 to 14 in favour of adopting Open Skies. Once implemented, it will remove the need for operators to hold a Guernsey air transport license for all routes except those to/from Guernsey to each of London Gatwick and Alderney which are protected until at least 2023.

While Guernsey's Economic Development committee has flagged Open Skies as a means of boosting the Channel Islands connectivity, local carriers such as Aurigny and Blue Islands warned that their year-round services could be impacted by new competitors cherry-picking the most profitable routes. In addition, the new policy will also remove a current mandate that carriers operate routes on a year-round, as opposed to seasonal, basis.

In a statement issued following the vote, Coates said Blue Islands had been able to build its business given the protection that licencing provided against the potential predatory summer-only entry of other airlines. However, with that safety removed, Blue Islands would now have to adjust its business strategy and model with negative consequences to the public.

“The regrettable unintended consequence of this decision is, as we advised, to change our business strategy and model," he said.

"Therefore, because we are now no longer bound by licence obligations to operate some half-empty winter flights, we will implement our Plan B, which we prepared in the face of this possible challenge arising. It is with deep regret as an island airline, that part of this refocus will inevitably be the removal of all of the non-profitable off-peak flights in the winter months, that used to lose us money."

He added that effective this winter season, Blue Islands will start by cutting flights to Jersey and Southampton.

"We will now be able to use the resulting aircraft availability to focus on the more profitable routes of our network, thereby maintaining our own business viability."

For his part, Aurigny Air Services (GR, Guernsey) CEO Mark Darby has warned the new Open Skies policy would likely result in short-term destabilisation of key routes.

"We are seriously concerned that air services in Guernsey will be irrevocably damaged, and once the open skies genie is out of the bottle, it will not be possible to revert to the existing system," he said.

Darby argued that while Open Skies has worked in other, larger markets, the Channel Islands was seasonal and lacked the scale needed for carriers to benefit from a fully liberalized system.

"While it is true that many jurisdictions have adopted open skies, many others, whose air routes, like ours, are sub-scale, seasonal, but above all essential, have not deregulated," he told the Bailiwick Express. "Some that have adopted open skies have lived to regret their decision. The Isle of Man is a prime example, where there has been a substantial deterioration in air services, to the detriment of the island’s economy. The number of destinations it serves has almost halved over the last 10 years."

An Aurigny spokesman later stated that the airline would wait and see the impact Open Skies would have on Guernsey’s connectivity.