Flybe accuses Gatwick of ignoring UK regions
Saad Hammad, the chief executive of Flybe, has criticised Gatwick for failing to address the needs of Britain’s regions, in its attempt to win support for its second runway. The head of the UK’s biggest regional airline said that Heathrow had been “more specific about what they are going to do” on take-off and landing slots and on charges for domestic flights and “I don’t think Gatwick has been as sensitive as we would like…. Heathrow has one up on Gatwick in terms of listening to regional needs and requirements.” Heathrow has said it would look at cutting charges for regional flights as part of a regular review of fees, though no binding commitment has been made. These cuts are largely to deter passengers flying via Schiphol or other European hubs, rather than concern for the regional airports. Flybe has no flights into Heathrow and only one from Gatwick to Newquay. It sold 25 pairs of slots to easyJet in 2013. A spokesman for Gatwick said that it had the “best” regional links of any London airport and would remain significantly cheaper than Heathrow, even if Heathrow reduced their domestic fees. Gatwick said it is planning to give details of its proposals on fees further later this month. It has claimed its landing charges would not rise above £15 per passenger, but only it gets a 2nd runway and Government agrees a contract not to allow any other runway in the south east for 30 years ….
Flybe accuses Gatwick of ignoring UK regions
By Phil Davies (Travel Weekly)
Gatwick has been accused by the boss of Flybe of failing to address the needs of UK regions in its fight with rival Heathrow to win support for expansion.
The regional carrier’s chief executive, Saad Hammad, said that Heathrow had been “more specific about what they are going to do” on take-off and landing slots and on charges for domestic flights.
“I don’t think Gatwick has been as sensitive as we would like,” he told the Financial Times. “Right now, Heathrow has one up on Gatwick in terms of listening to regional needs and requirements.”
Heathrow has pledged to cut charges for regional flights as part of a regular review of fees, though no binding commitment has been made.
Flybe has no flights into Heathrow and just one from Gatwick to Newquay, having sold 25 pairs of slots to easyJet in 2013.
A Gatwick spokesman said that the airport had the “best” regional links of any London airport and would remain significantly cheaper than Heathrow, even domestic fees were reduced.
It is planning to set out its own proposals on how to improve fees further later this month.
“UK plc needs a network of long-haul airports that provide direct services around the world, rather than forcing all flights through a single-hub airport in the capital,” the Gatwick spokesman said.
Heathrow to reduce charges on domestic flights from £29.59 to £19.59 from Ist Jan 2016 – to deter passengers flying via Schiphol etc
Heathrow plans to cut the fees it charges airlines for domestic passengers. It says that from 1st January 2016 it will reduce the minimum departure charge for all flights (currently £1,406) to £1,268.40 per domestic flight. It will also cut the charge from £29.59 to £19.59 per passenger, in a bid to increase the number of passengers flying between UK regional airports and Heathrow. Heathrow serves just 7 regional destinations, down from 18 in 1990. It hopes the lower charges on domestic routes would encourage fuller planes and make more efficient use of the limited number of slots for regional flights, which are less profitable for airlines than long haul flights. Heathrow also says it will reduce minimum charges per plane to £1,592.15 for EU flights and £2,689.82 for non-EU destinations. It will also cut the per passenger charge for passengers flying to European destinations by £5 to £24.59. They plan instead to charge more for the noisiest planes, and those that emit more NOx – with the overall changes revenue neutral. The aim is discouraging passengers flying via European airports like Schiphol, and using Heathrow instead. The environmental fees would rise from being 21% to being 28% of total airport charges. Heathrow also say that, if they get a 3rd runway, they would open 5 new domestic routes, including Humberside, Newquay and Liverpool.
Gatwick “promises” to cap landing charges to £15 + inflation for 30 years (if it gets an unspecified 30 year “contract” from Government)
Gatwick airport, in frenetic publicity in the months before the Airports Commission runway recommendation (expected late June) has made various pledges – in the hope of currying favour. It says it will “bear all the main risks” of a new runway. Sir Roy McNulty, chairman of Gatwick, has written to Sir Howard Davies saying – among other things – that the landing charge will be kept at £15 (plus inflation) for 30 years. As long as there is no new Heathrow runway. (It is currently £9). Sir Roy said it is “in return for Government agreeing a 30 year contract” though exactly what that means is not explained. Presumably a contract that there will be no other runway? Gatwick also says it will “bear all the main risks of the expansion programme . . . including long-term risks related to traffic levels, market pricing, construction and operating costs”. How exactly? Gatwick’s main airline, EasyJet, is not happy with charges rising to £15. The Airports Commission consultation documents considered Gatwick’s estimate of £15 to be too low, and instead considered “average charges rising to between £15 and £18, with peak charges of up to £23.” These higher levels were due to lower estimated levels of air passenger demand than Gatwick’s optimistic figures, and higher infrastructure costs. [ Airports Commission’s consultation document Page 47].
The “30 year contract”
Asked what this contact says, or whether it exists, below is what Gatwick senior management have said:
“The exact nature of the thirty year contract has yet to be finalised – its purpose would be to clarify the commercial and regulatory environment in which we would be operating, including the anticipated timing of any new runways beyond that granted to Gatwick. Whilst we understand that one government cannot bind a future government irreversibly, if there was a legal contract in place and the future proved different from that which had been committed to, the contract could also govern what might happen in those circumstances.”
Make of that what you can !
GACC says Gatwick’s rash promise to cap landing charge at £15 puts its runway plan in doubt
Gatwick airport have made a very rash promise not to raise their landing charges above £15 (plus inflation) for 30 years, if they get a 30 contract from the government (details not specified). Brendon Sewill, of GACC said: “The whole runway project is in doubt…. Gatwick’s rash promise not to raise airport charges above £15 per head …. seriously puts in question whether building a new runway at Gatwick is a viable business proposal – either for the present owners or for the new owners if Gatwick is sold.” The Airports Commission calculate that Gatwick charges would need to rise to ‘between £15 and £18, with peak charges of up to £23. GACC points out that Gatwick’s promises are meaningless unless they are put into a legal agreement binding on the present airport owners – and future owners. If so, the £15 would become a legal maximum – rather than the current £9. Even at £15, some airlines, and passengers might well decide instead to use much cheaper airports such as Stansted or Luton. GACC has pointed out to the Airports Commission the risk that Gatwick may have fewer passengers than forecast, in which case the cap of £15 may not be sufficient to cover the costs of a new runway and new terminal. Brendon Sewill asks: “What would happen if the money runs out when the new runway is only half built?”