“Quite serious” cost-cutting measures are likely at Cornwall Airport Newquay, a Cornwall Council corporate finance committee meeting heard.

The council’s decision earlier this year to scrap the Public Service Obligation (PSO) service from Cornwall to London Gatwick has seen a drop in income at the council-owned airport, while the effects of the war in Iran may also be an issue the longer it continues.

Cllr Tim Dwelly, Cornwall Council’s cabinet member for the economy, updated the committee about Cornwall Airport Newquay at its meeting on Tuesday, June 2.

He said: “We’re very hopeful, though I can’t say anything due to commercial confidence, about some significant new routes, but with what’s going on in the Strait of Hormuz there are issues with fuel and obviously airlines are more cautious than they were before that happened.

“Hopefully that will be resolved but we need to be aware that’s a problem.”

Cllr Dwelly added: “The airport itself, without the Public Service Obligation flights, is not having as much income and that puts financial pressure on this authority.

“We’ve commissioned a study into the efficiency of the airport operation because I suspect we are going to have to require some quite serious cost-cutting measures in the era we’re in now.

“That doesn’t stop the work going on on the land around the airport or on new commercial routes, which I’m quite confident about.”

Cllr Dwelly said: “In the future, and this will take some years, the plan is if we’re having business rates and ground rents coming in from what are currently empty buildings or empty fields in some cases, we will be able to balance the cost of the airport against the revenue that the land around it generates for this council.”

In a report to the committee, he outlined that the airport team remains focused on leading a proactive programme of engagement with airlines and partners to explore opportunities for new commercial routes into various London airports that best serve business, leisure and international connectivity needs.

Also develop a broader, more resilient commercial model that reduces reliance on long-term public subsidy, by focusing on cost control and revenue diversification options.

Continue to work with existing and new airline partners to improve the year-round and hub connectivity options from Newquay to support the local economy.

Construction of the airport’s new radar system is underway and is expected to be completed by the end of the summer.

A ‘specific operations risk assessment’ application has now been submitted to the Civil Aviation Authority to unlock air space to the west of Newquay.

Subject to Civil Aviation Authority approval, this will create controlled test and operating areas for emerging aviation technologies.

Further work is being explored to expand on this initiative and to ensure that the airport is “positioned as a national asset for the development, testing and enabling of future flight opportunities and next generation air mobility.”