Heathrow sets out vague, unenforceable, offers to boost links to regions with 3rd runway (with easyJet’s help?)
Heathrow is trying to put more heavy pressure on the government, to back its 3rd runway plans, if there is an announcement in the next few months (EU referendum permitting). Heathrow are aware that it is not considered likely that the regions will get much benefit from a 3rd runway, so it now says it will “improve connectivity, with better air, rail and bus connections from Heathrow to every major town and city – North, East, South and West.” No details, and not things done by Heathrow itself. It says its runway means the creation of “up to 180,000 new jobs and 10,000 apprenticeships across the UK” (no time scale given, so pretty useless statement). And that: “A third runway will boost the economy by up to £211 billion, with the benefits spread across the country.” The £211 billion claim is very suspect. Even the Airports Commission’s most optimistic (criticised by its own advisors) was a maximum of £147 – and that is up to 2080, so over 60 years. Heathrow says it will increase flights to airports like Liverpool, Humberside and Newquay, if it got a new runway. And it might create a “new £10 million Route Development Fund which will provide start-up support for any potential new domestic destinations.” The Airports Commission realised that unless government subsidises (taxpayers’ money) domestic routes from Heathrow, the number would end up being lower than the number now.
Heathrow’s “manifesto” says:
“Heathrow already links eight cities to the world – Aberdeen, Belfast City, Edinburgh, Glasgow, Inverness, Leeds, Newcastle and Manchester. An expanded Heathrow would add flights to new domestic routes to Jersey, Isle of Man and Belfast International. [These are the routes EasyJet suggested it might add, if it started operations at Heathrow, with a 3rd runway. See below]
“Heathrow will be establishing a special £10m Route Development Fund, providing start-up support for new domestic destinations. This will support up to five new routes from Heathrow with airports like Liverpool, Humberside and Newquay on the shortlist.” [Newquay already has a PSO funded route to Gatwick. The Government’s Regional Air Connectivity Fund (RACF), is a £20 million fund set aside by the coalition Government, to pay for routes such as Newquay].
Heathrow also says:
“A third runway will lead to better connections from Wales to the rest of the globe – enhanced by the fast Western Rail Link that is backed by the Welsh Assembly.” [Scarcely a direct consequence of a runway …. Cardiff is not on the list of airports mentioned above. AW note].
Heathrow actually says that much of the connection to the regions will be by better rail links, getting people to Heathrow. [ link Page 12].
The Airports Commission final report said:
“Public Service Obligations could be used to support a wide network of domestic routes at Heathrow.”
and P 35
“It is crucial to ensure that expansion at Heathrow delivers benefits for all of the nations and regions of the UK
“A new northwest runway is likely to protect and bolster domestic services in and out of London leading to a rise in the number of passengers and frequency of services on the thickest routes, but more can be done to facilitate connections from the airport to an increased number of domestic destinations.
“To secure this, the Commission recommends that:
The Government should alter its guidance to allow the introduction of Public Service Obligations on an airport-to-airport basis, [AC emphasis] and use them to support a widespread network of domestic routes at the expanded airport.
“HAL should implement additional measures to enhance domestic connectivity, including reduced charges and start-up funding for regional services. ” [AC emphasis] ”
and P 78
” An important consequence of the airport capacity constraints in the UK is the apparent decline of domestic connectivity into the largest London airports and particularly into Heathrow.”….”Heathrow saw over 40,000 domestic flights in 1990 compared to just 23,000 in 2014″
and P 79
“A significant decline in the number of domestic routes into Heathrow has also been seen over recent years (see Figure 3.3). The Commission’s forecasts predict that, unless capacity is expanded, this pattern will continue, with the number of destinations served from Heathrow declining to as few as three by 2040. The primary reason for this reduction in domestic connectivity at Heathrow is that, with practically all the airports slots taken up, many domestic destinations are priced out by long-haul routes that deliver higher yields per passenger.”
and P 266
“The Commission’s forecasts suggest that with expansion more than twice as many domestic passengers will travel via Heathrow in 2040 than if the airport’s capacity remains constrained. In addition, to ensure that cities and regions across the UK can benefit from Heathrow’s enhanced connectivity, including areas such as the Highlands and Islands, the Isle of Man and the Tees Valley, which have lost their direct links to Heathrow over recent decades, the Government should use Public Service Obligations (PSO) to support a widespread network of domestic routes.”
and Page 313
“Heathrow Airport Ltd (HAL) should implement additional measures to enhance domestic connectivity, including introducing reduced charges and start-up funding for regional services.”
“Capacity constraints at Heathrow Airport have seen the number of domestic connections decline at the airport over recent years. No daily service has operated between Heathrow and Liverpool since 1991, Inverness since 1997 and Durham Tees Valley since 2008.”
and Page 314
“The new slots made available at Heathrow would allow airlines to establish new domestic links to the capital, re-establish lost connections and increase frequencies on those that are already in place. Heathrow Airport Ltd and easyJet’s consultation responses argued that were the low-cost carrier to move to the airport, it would seek to develop new services to Inverness, Jersey, Belfast International and the Isle of Man”. [So some of these potential future domestic links might depend on EasyJet? Which will resist the high landing charges necessary to pay for the 3rd runway? AW note].
“To support this point, the National Connectivity Task Force put forward analysis considering the latent demand for services from the UK regions to the capital, suggesting that in 2040 domestic services could utilise 136-175 additional daily slot pairs at an expanded Heathrow, compared to current day slot allocation of 55 daily 313 slot pairs. This would equate to 6.5% of runway capacity at the expanded airport being utilised for domestic services, up from 4.2% currently. ”
and Page 315
“15.7 Against this positive outlook, it is important to note that even in the event of expansion, a number of competing pressures may limit the increase in domestic services to an enlarged Heathrow. One such pressure could be continuing competition from overseas hubs, which may still be able to offer cheaper services, higher frequencies, or more convenient connections on some routes. An expanded Heathrow is also likely to see rapid growth in demand, which may relatively quickly begin to exert pressure on slots during the most popular periods.
“15.8 The Commission’s forecasts reflect these pressures and suggest that without specific measures to support domestic connectivity even an expanded Heathrow may accommodate fewer domestic routes in future than the seven served currently. It would still however see more than the three domestic routes predicted to be available from the airport without expansion. “
“Given the historic long-term pressures on the availability of capacity for domestic services at a constrained Heathrow, any stabilisation in the numbers of domestic services operating to the airport is to be welcomed. Nonetheless, the Commission believes that this should not be the limit of the UK’s or the airport operator’s ambition.
“15.10 In summary, a new runway at Heathrow will enhance the domestic connectivity of the UK, strongly benefitting the nations and regions outside London and the South East. In order to ensure that these benefits are widely spread and a diverse network of domestic routes is supported at the expanded airport, however, additional measures may be required. These are discussed in the next section of this chapter.”
There is a long section, Pages 316 to 319 setting out the Commission’s thinking on the issue. Worth reading.
There are considerable difficulties in setting up PSOs (Public Service Obligations) for routes, and there is no guarantee that the UK government would want to use public funds in this way, or would be permitted to within the EU. These routes could only be made viable if given public subsidy. Is this a good use of taxpayer’s money? (especially as only about 11% of UK flights in 2015 were for business, and the rest for leisure).
“The UK has in the last 12 months [AC report published in July 2015] established two PSOs, one from Newquay Airport to London Gatwick and the other from Dundee Airport to London Stansted. Both routes were subsidised out of the Government’s Regional Air Connectivity Fund (RACF), a £20 million fund set aside by the coalition Government to safeguard routes to and from the London airport system and the UK regions.”
Heathrow vows to increase number of UK regional routes if it is awarded third runway
23.5.2016 (Business Daily)
UK transportation hub Heathrow Airport has released an ‘election-style’ expansion manifesto as it looks to turn up the pressure ahead of the government’s decision on a third runway.
The manifesto outlines five pledges that the airport claims will help alleviate environmental and community issues, as well as boost the UK economies and regions.
One such promise is the introduction of new regional routes to and from the airport, which Heathrow claims will help pass on the benefits of increased capacity right across the UK, with the airport mooting new routes to the likes of Liverpool, Humberside and Newquay, were a new runway to be given the green light.
The airport has also suggested that it would create a new £10m Route Development Fund which will provide start-up support for any potential new domestic destinations.
It comes as pressure grows on the government to make a final decision on whether to build an additional third runway at Heathrow, or opt for an alternative way, such as an extra runway at Gatwick.
Commenting as part of the manifesto’s release, Terry Scuoler, Chief Executive Officer of EEF, the manufacturers’ organisation, bemoaned the government’s sluggishness on the issue and registered his belief that it is damaging the UK economy.
He added: “The brake on expansion at Heathrow is also a brake on UK jobs and growth. While the Government continues to dither, the tally of lost opportunities for UK business continues to mount.
“Valuable contracts remain on ice and this undoubtedly means manufacturers of all sizes, supply chains and regions are losing out.”
Mike Cherry, National Chairman of the Federation of Small Businesses, added: “Business across Britain needs Ministers to act on the Airports Commission recommendation from last July.
“A new runway at Heathrow represents the best chance we have for airports expansion, and today they make clear commitments to boost cargo for exports, and to improve regional connectivity.”
Heathrow launches ‘election-style’ expansion manifesto pledging to secure a stronger economy for families across Britain
23.5.2016 (Heathrow airport press release)
The “manifesto” is at http://mediacentre.heathrow.com/pressrelease/downloadext_assets/81/175/6362/433
- Heathrow expansion manifesto built around five new pledges to create jobs, connect businesses to global growth, improve domestic connections, be a better neighbour and secure a lasting legacy for future generations
- Launch events held in Liverpool, Yorkshire, the Midlands and the Thames Valley
- The prize is up to 180,000 new British jobs and £211bn of economic growth across the country if Government approves Heathrow expansion
Heathrow CEO John Holland-Kaye today pledged to secure the economic future of families across all of Britain if the airport is allowed to expand.
Underlining the importance of a decision for the British economy, the airport unveiled an ‘election-style’ manifesto at events across the country highlighting that Heathrow expansion would be the right choice to benefit every part of Britain.
The manifesto is built around five core pledges to secure a brighter future for Britain and reflects the prize for the Government if it chooses to expand the nation’s only hub:
- Help Britain’s economy grow stronger, creating up to 180,000 new jobs and 10,000 apprenticeships across the UK.
- Let our country stand tall, connecting businesses with up to 40 more long haul destinations across the globe.
- Meet tough environmental and noise limits, enforced by new independent regulators.
- Improve connectivity, with better air, rail and bus connections from Heathrow to every major town and city – North, East, South and West.
- Secure a lasting legacy for future generations, enabling our children to compete in the global race.
After considering all the evidence objectively, the Prime Minister’s Airports Commission unanimously decided that Heathrow expansion is the best choice for Britain. A third runway will boost the economy by up to £211 billion, with the benefits spread across the country.
Earlier this month, Heathrow cleared the way for the Government to support its expansion proposal by meeting and, in most cases, exceeding the conditions set out in the Airports Commission’s recommendation for Heathrow expansion.
Heathrow CEO John Holland-Kaye said: “If Heathrow falls behind, Britain falls behind. That means fewer jobs and less security for families. That is why we must have runway capacity that is fit for the future and build it now.“We all want our children to inherit a country that is stronger and can compete in the world. A keystone of our children’s future success is an expanded Heathrow.“Economic security, opportunity for people in every part of Britain, outward looking abroad but fair to our neighbours at home – that is the promise of our manifesto. But we can’t do it alone – we need people across the country to let the Prime Minster and the Government know that they cannot just hope for a stronger economy and country – they need to choose it and the right choice is Heathrow.”
Terry Scuoler, CEO of EEF, the manufacturers’ organisation, said:“The brake on expansion at Heathrow is also a brake on UK jobs and growth. While the Government continues to dither, the tally of lost opportunities for UK business continues to mount. Valuable contracts remain on ice and this undoubtedly means manufacturers of all sizes, supply chains and regions are losing out.”
Mike Cherry, National Chairman of the Federation of Small Businesses, said:“Business across Britain needs Ministers to act on the Airports Commission recommendation from last July. A new runway at Heathrow represents the best chance we have for airports expansion, and today they make clear commitments to boost cargo for exports, and to improve regional connectivity. It’s now time to back British business.”
Heathrow expansion ‘could create 5,000 jobs in Northern Ireland’
19/05/2016 (Belfast Telegraph)
Heathrow chiefs say air links with Belfast International Airport could be restored if the London hub is permitted to build a third runway
Heathrow could create up to 5,000 new jobs in Northern Ireland if an expansion bid gets the go-ahead, the London airport’s chief executive has claimed.
John Holland-Kaye said air links with Belfast International Airport could also be restored if the London hub is permitted to build a third runway.
In July last year the Airports Commission recommended that the runway should be built at Heathrow alongside a “significant” package of measures to make its expansion more acceptable to nearby residents. A final decision has not been taken by the Government.
Mr Holland-Kaye told a Belfast business audience: “We cannot be the generation that avoids the big decisions, that pulls the ladder up behind us. We need to make the right choices in our generation so that the next generation, our children, can enjoy the benefits we have enjoyed.
“With Heathrow expansion we will create up to 5,000 new jobs here in Northern Ireland while we build and when we have built – providing opportunities for young people.
“We can grow the number of airports in Northern Ireland connected to Heathrow – with flights to Aldergrove.”
Mr Holland-Kaye has already announced plans to end night flights in an attempt to support Heathrow’s offer to build another runway.
British Airways and Irish flag carrier Aer Lingus already connect George Best Belfast City Airport with Heathrow. Aer Lingus left the International Airport for Belfast City in 2012.
Mr Holland-Kaye addressed the CBI in Northern Ireland’s annual dinner in Belfast.
“We can bring in new airlines, meaning new competition and choice, higher frequencies and lower fares.
“We can grow your competitive advantage further. More flights to more cities in China, and Asia, the Americas and Africa – the growing markets of the world.
“Let us give you the ability to get to the world and for the world to come to you.”