Ireland bids to recover long-lost transatlantic air traffic

* British Airways owner IAG helps propel Dublin as hub

* Dublin now one of top 5 transatlantic hubs in Europe

* Pre-clearance facility key, new runway planned

* Executives say target shifting from UK to EU passengers

By Conor Humphries

DUBLIN, June 2(Reuters) - Decades after long-range airliners ended Ireland (Other OTC: IRLD - news) 's role as the stepping stone to Europe for Americans, who sipped Irish coffees as their propeller-driven planes refuelled, the country is slowly re-establishing itself as a major transatlantic aviation hub.

Last year Dublin for the first time entered the top-five rankings for transatlantic hubs in Europe, data showed, after British Airways owner IAG started to implement plans to use Dublin as an alternative to the continent's top hub at London Heathrow.

With Irish low-cost giant Ryanair considering using its fleet to feed long-haul services, senior airline executives at the first annual meeting of the International Air Transport Association to be held in Dublin since 1962 talked up prospects for further growth.

"It (Other OTC: ITGL - news) 's an absolutely enormous opportunity for Dublin," said Pat Byrne, chief executive of Irish regional airline CityJet, which announced plans to double its fleet to 50 planes. "The last time Ireland has had this significance (for transatlantic travel) was when airplanes had to stop to fuel."

In the 1940s and 50s U.S (Other OTC: UBGXF - news) . presidents and movie stars would stop off near Shannon on the west coast of Ireland before flying on to Europe's great cities, bringing a touch of glamour to one of the most under-developed regions in Western Europe.

Locals claim the Irish Coffee, finished with a dash of whiskey, was invented by a local barman catering for the visiting stars. But the airport went into decades of decline when long-range jets could fly further.

Ireland's resurgence has been fuelled in recent years by strong sterling, a large under-utilised terminal completed just after Ireland's 2008 banking crisis and the only pre-clearance facility for travelling to the United States in an EU capital.

Transfer traffic has been growing at Dublin by between 25 and 30 percent a year as former flag carrier Aer Lingus has built up its long-haul fleet from seven in 2010 to a target of 20 by 2020, a spokesman said.

Meanwhile all transfer traffic through Dublin airport rose 50 percent to 250,000 passengers in the first four months of the year, the Dublin Airport Authority said.

Heathrow had 230,000 transatlantic seats available weekly at the peak of last summer compared with fifth-placed Dublin with 41,000, according to aviation data and analytics company OAG.

Dublin has focused on the 25 regional UK airports it has direct flights to, but the focus is shifting towards other parts of western Europe, said Dublin Airport Authority chief executive Kevin Toland.

The next stage could be to harness Ryanair, whose second largest base in Europe is Dublin, with 86 destinations.

Long averse to connecting flights due to logistical difficulties, Ryanair has said it will experiment with connections this summer with a view to feeding long haul airlines in the future.

But Ryanair Chief Commercial Officer David O'Brien told Reuters it would need a "stronger compelling economic reason" before it starts regular feeds for rival carriers.

Executives also cited Ireland's pro-business regulator as a plus. The Irish Aviation Authority has been pushing to allow Norwegian Air Shuttle (LSE: 0FGH.L - news) 's Irish subsidiary to start flying transatlantic routes, despite heavy resistance from U.S. carriers against it.

Aer Lingus Chief Executive Stephen Kavanagh, who has been spearheading his airline's hub plan since its takeover by IAG last year, said the key to further growth is being opportunistic, poaching passengers from overcrowded hubs in Europe and the United States.

"Poor airports in North America is an opportunity to connect cities on the east coast directly to Dublin," he said. "We have such a small home market, we have to be internationally relevant in everything we do." (Additional reporting by Joachim Dagenborg in Oslo; Editing by Greg Mahlich)