The Ciudad Real Airport opened in 2008, only for it to close three years later. The cost for this project was €1.1 billion which included a large amount of public funding for infrastructure. The site is next to a town of just 72,000 people on the sparsely populated Castilian Plain and lies more than 140 miles from Madrid. The project was launched by local private investors, financed by Caja Castilla La Mancha (CCM), the regional savings bank, or Caja and fully supported by the regional government of Castilla La Mancha.

The airport was even to be named after Don Quixote with a huge Don Quixote-themed attraction nearby, which did not materialize. Only Vueling flew there, and it eventually closed in 2011, with the last Vueling flight that year. The airport closed as a massively loss-making white elephant in April 2011 and now sits almost abandoned – except for some car testing. The airport was initially meant to be an alternative to Madrid Barajas Airport, which would see it handling that airport overflow, with a high-speed train station on the Madrid-Seville line. The terminal was designed to handle up to 2.5 million passengers a year with hopes that low-cost airlines would use the airport. Airlines, including Vueling and Ryanair, operated flights briefly, including the now-closed Air Berlin. However, these failed to last long, with the airport only carrying 190,000 passengers during its entire operation, having just three flights a week.

The airport opened its runways to a world in the worst recession for nearly 100 years. Caja Castilla La Mancha became the first of Spain’s local savings banks to go under in the crisis, with a rumored 70% stake in direct and indirect investment in the airport. Many more of Spain’s Cajas have since had to merge or be taken over, exposed to toxic debts. Should they have been speculating on Spain’s construction boom? The Bank of Spain has fined two of the politicians who sat on the board of Caja Castilla La Mancha for what it calls “serious violations”. “You might think the airport failed because of the crisis, but I am convinced that the shareholders never thought it (the airport) would work. The only profit in this airport was the building of it,” says local investigative journalist Carlos Otto.

The official bankruptcy report for the airport backs this up. It says: “The loans taken out were enough to cover the construction phase, but no thought was given to the investment needed to make the airport function as a business.” Banks approached by the shareholders for further loans said they didn’t think the business model for the airport was viable, the report says. It goes on: “The construction itself of the airport provided the first profit for the investors because they signed contracts with their own construction companies.”

(a) Explain the scope of this project.

(b) Outline four (4) deliverables during the implementation of this project.

(c) Do you think Project Management is essential in today’s society? Why?

Answer rating: 100% (QA)

a The scope of the Ciudad Real Airport project was ambitious aiming to establish an alternative airp... View the full answer