London’s transport authority is seeking new sponsors for its Emirates Air Line cable car, which faces a deficit in costs of more than £18m ($27m), Arabian Business can reveal.
The 1.1km Thames river crossing, which is sponsored by Dubai’s Emirates Airline, opened in June last year in preparation for the London 2012 Olympics and has since carried more than 2m passengers.
The project cost Transport for London (TfL) more than £62.6m to build, a Freedom of Information Act request shows, with Emirates providing £36m in a ten-year branding deal, with a further £8m stumped up by the European Regional Development Fund.
Earlier this year, reports stated that Emirates Air Line was losing approximately £50,000 per week due to its £150,000 operating costs.
A TfL spokesperson told Arabian Business that the transport authority was seeking additional funds to cover £18.6m outstanding in initial planning and construction costs, as well as ongoing maintenance.
“It is envisaged that revenue generated will, over time, cover all costs including the operating costs and make a modest surplus which will cover the outstanding construction costs,” the spokesperson said.
“TfL continues to look for additional funding opportunities, including third party funding, additional sponsors and retail rental income.”
Under the terms of the deal with Emirates, London received £1m on the date of execution of the sponsorship deal, a further £2.5m in April 2012 and £6.85m on commencement of operations.
The deal is structured so that TfL will receive £2.85m ever year for the next nine years. The Dubai-based carrier is currently the only sponsor for the project.
TfL said that most of the outstanding capital costs for the project related to design, land acquisition and risk.
Earlier this month while on a visit to Dubai, Mayor of London Boris Johnson insisted that the scheme would be able to pay for itself. “It’s the only piece of transport infrastructure in London that’s going to cover not only capital costs, but also running costs by 2019,” he said.
”There is nothing else that we’ve built that pays not just for the cost of running it but also for the initial outlay.”
During last year’s Olympics, the cable carried more than 20,000 passengers per week, although this figure was said to have dwindled to fewer than 15,000.