Price war breaks out on Scottish islands flights

Loganair will stop flying under the Flybe brand from the end of August

A price war has broken out on some air services to the Northern and the Western Isles.

As Flybe prepares to go head to head with Loganair from the beginning of September, some flights from Stornoway to Glasgow are on sale for just £50.

The airlines have jointly operated routes across the Highlands and islands under a franchise agreement since 2008.

But last year Flybe announced that it was terminating its contract with the Scottish airline from 31 August.

It has formed an alliance with Eastern Airways to operate busy routes between the Northern and Western Isles and the mainland.

Loganair has said it will operate in "its own right" in direct competition with its former partner.

Speaking to BBC Radio Scotland, economist Tony Mackay predicted that one of the airlines would be a casualty of the price war.

"I think that one of them will stop because they'll be losing money," he said.

"I don't see there being enough people to justify competition on these routes for more than a few months."

Loganair has been revamping its fleet as part of wider improvements to its services

Passengers will be the real winners of the price war, according to the travel editor of The Independent, Simon Calder.

"I think it's going to be very good in the short term but I think, by Christmas, given the sparse community on the islands and the fact that people generally don't like being tourists in that part of Scotland in the winter, it could get quite nasty," he said.

"But it really is too early to call at this stage."

Loganair said it was up for the fight.

Its managing director Jonathan Hinkles said the airline had operated in Shetland for 45 years and it had a "long future" ahead of it.

Lower fares

He claimed Flybe's chief executive had said they were committed to the area "for a year".

"Well I have got news for her," he said. "We are committed to this for the next 45 years as well."

But it was Flybe who was responsible for driving down prices on the island routes, according to its chief revenue officer Vincent Hodder.

"Instead of roughly £300 round trips, we are now talking about £50 one-way fares," he said.

"The massive reduction of the price is a direct result of Flybe entering the market. I do believe that there is room for two operators on the route."

He added: "We firmly believe that by offering lower fares, we can stimulate business links, we can stimulate leisure links."