General News
Below are links to stories of general interest in relation to aviation and airports.
Heathrow proposals for pre-runway flight increase, to try and win Government backing for runway
Heathrow will be putting forward some proposals at the Conservative party conference, to be allowed to start increasing the annual number of flights from 2021 by 25,000 per year (about 68 more per day). "New technology and better use of existing runways will achieve this." (ie. largely loss of runway alternation part of the day, and narrow flight paths?). Heathrow is selling this as a way to start to give a quick "Brexit boost", even before its hoped for 3rd runway is operational. Heathrow is claiming that the "environmental constraints" will all be met (it is unclear how this will be done) with no more noise problems, no more air pollution problems etc. All that is proposed is more money for home noise insulation, (£60 million - it has already said it will spend £700 million) and a congestion charge - no details - for vehicles travelling to and from Heathrow. The plans will be subject to consultation and Government approval. There is a mention of talks with government in future to perhaps delay the start of scheduled flights to 5.30am from the current 4.30am. The main thrust of Heathrow's plans is to say the extra flights will be vital for the economy, with slots set aside for domestic flights. There would be a £10 domestic passenger discount to support "small and large exporters, boosting competition." There are claims of 5,000 more local jobs over 5 years by this pre-runway expansion, and extensive economic benefits for all the UK .... £1.5 billion in the period 2021 - 2015.
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Heathrow rushes out scheme for increased number of flights BEFORE 3rd runway built – HACAN reaction
Heathrow under pressure from Government to deliver expansion as quickly as possible post-Brexit, has released details of a scheme to increase capacity in advance of a 3rd runway. It will be officially launched at the start of the Conservative Party Conference (2-5 October). Amongst Heathrow's key proposals are - by 2021: - Increasing the number of flights on the existing runways by up to 25,000 a year. - Increasing passenger numbers by 4 million. - Introducing a night flight ban from 11pm to 5.30am. - Putting more money into noise insulation schemes. - Introducing a possible congestion charging scheme around the airport to manage traffic levels and pay for future rail improvements. The extra 25,000 flights per year, starting well before the 3rd runway is open, would require Heathrow to seek planning permission to exceed the current 480,000 cap on flight numbers (imposed as a condition of Terminal Five being allowed, in March 1999). Heathrow expects to have the measures in place by 2021 if it gets permission for a 3rd runway. Residents have regarded this cap of 480,000 flights as sacrosanct, and vital, for the levels of noise around west London. John Stewart, Chair of HACAN, said this offering by Heathrow has been rushed out to try to address government's problems with Brexit. Heathrow knows its scheme is more expensive, and would take more time to complete, than the Gatwick runway or the Heathrow Hub scheme.
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Anti-Corbyn Labour backbenchers plan party vote – to back Heathrow runway
The Parliamentary Labour Party has various committees, one of which is on Transport. This is chaired by the young MP for Luton South, Gavin Shuker. The membership of this backbench committee does not appear to be publicly available. There is nothing online about the committee or its work. Mr Shuker says his committee has now produced (or is about to produce) a report that proposes Labour should back a Heathrow runway. They plan to present this report to a meeting of Labour MPs and peers, when Parliament returns after the party conferences. Mr Shuker has been critical of Jeremy Corbyn for the past year or more, and he now wants to get the Labour party to reverse his opposition to a Heathrow runway by getting a vote on the issue within the party. Gavin Shuker said the vote could be the day after the Labour meeting. As well as Jeremy Corbyn, the Shadow Chancellor John McDonnell, is deeply opposed to a Heathrow runway as his constituency would be badly affected by it. Mr Shuker wants the party to challenge Jeremy Corbyn on a number of policy issues. Heathrow is just one of many, and is a symptom of party disunity. On the same day, it was revealed that the Heathrow-funded and sponsored group, Back Heathrow, had asked for John McDonnell's constituency boundary to be redrawn, to exclude Heathrow - to help their case. Amazing.
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Heathrow investors snub Chris Grayling’s request for their funding of Heathrow Hub scheme
Some of Heathrow's leading shareholders have snubbed a request from the Transport Secretary, Chris Grayling, to back the Heathrow Hub scheme, that involves adding another runway at the western end of the northern runway. Sky News understands that big investors in FGP Topco, Heathrow's parent company, are refusing to give a written commitment to funding the rival scheme. Heathrow argues that it has not done sufficient due diligence to justify giving its backing to Heathrow Hub. Mr Grayling made the request at a meeting with the two runway promoters last month, since when further talks have been held between executives at Heathrow and Heathrow Hub. While it is understood John Holland-Kaye, Heathrow's CEO, would accept the Hub plan if he cannot get his north-west runway, the airport's leading shareholders are refusing to back it. They believe future financial returns would be lower with the Hub scheme than the NW runway scheme. Sky News has been told that Mr Holland-Kaye had been told by his shareholders that acknowledging any support for the Hub scheme would be a tactical error, at a time they believe is so close to an announcement by the Government. Both Heathrow schemes have offered cut-price versions of their proposals in a bid to convince ministers of their merits. FGP Topco's shareholders are Ferrovial (25% stake), and sovereign wealth and pension funds from Australia, Canada, China, Qatar and Singapore.
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ONS data shows rising monthly tourism deficit, with more Brits holidaying abroad and spending more
The ONS (Office for National Statistics) produces monthly data on the numbers of UK residents who travel abroad, and for what reason. Also the number of overseas residents who travel to the UK, and for what reason. They also record how much the UK residents spend on their trips abroad, and how much overseas visitors spend in the UK. The net balance, between the two amounts is called the Tourism Deficit. It is always a deficit, as much more is spent by British outbound visitors, than by visitors coming into the UK. The ONS data for July show that, in the year to the end of July 2016 - UK residents made 67.8 million visits abroad, up +7% compared to the year before. Overseas residents made 36.6 million visits to the UK in that period, up + 4% on the year before. UK residents spent £40.8 billion on these visits during the year, which was +9% more than the same period a year earlier. But the overseas residents spent £21.8 billion on their visits to the UK, which was -1% less than the year before. The deficit grew significantly between July 2014 and July 2016, from £0.93 billion to £1.76 billion, for just that one month. The UK tourism deficit for all of 2015 was £16. 9 billion. Of all the trips made by UK residents abroad, the proportion to Europe is around 79 - 80% of the total, and 20% to the US and the rest of the world. Of all the trips to the UK, about 72 - 73% are from Europe, and about 28% are from the US and the rest of the world. Most trips other than to nearby Europe are by air.
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Monarch expects ‘significant investment’ of many million £s within days to avoid cash crunch
Monarch Airline’s majority shareholder, Greybull Capital, is preparing to offer the short-haul carrier another multi-million pound lifeline after problems from the post-Brexit sterling plunge, on holiday demand. Monarch has had to deny weekend speculation that it is on the brink of bankruptcy and has assured the market that it is in line for a “significant” investment in the coming days. The rescue bid is expected to be led by Greybull Capital, which owns a 90% stake in Monarch, after it agreed to pump £125 million of permanent capital and liquidity facilities into Monarch in 2014. That Greybull bailout was Monarch’s 3rd in 3 years and prompted the Mantegazza family, who started the airline in 1968, to sell up completely. Since 2014 Monarch has made £200 million cost cuts, to try to improve its finances, and it made a £19.2 m pre-tax profit in the year to October 2015, compared to a £57.3m loss the year before. Now the devaluation of the £ caused by the Brexit vote means there is an uncertain time, of unknown duration, ahead for the travel industry. There are also uncertainties due to terrorist incidents, making travellers nervous about some countries. Earlier in the summer Monarch said it needed £35 million and issued a "going concern" warning in its annual report.
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Emirates postpones its 4th daily Gatwick flight to Dubai – there are 6 per day from Heathrow
Emirates has confirmed it is postponing the launch of its fourth daily service from Dubai into Gatwick. Emirates had been due to start the 4th daily flight in October, which would have been the airline’s 10th daily service into London. An Emirates spokesperson said: “Emirates can confirm that we are delaying the launch of our fourth daily service to London Gatwick. This decision was made as part of our routine operational review, to ensure that our capacity is deployed to best serve customer demand across our global network. We remain committed to London and will continue to serve our customers on this route with a total of 63 weekly flights from Heathrow and Gatwick.” Back in March, Emirates has announced it would add its 10th daily flight to Dubai. It would have been a new B777-300ER (eight first class suites, 42 in business class, and 310 in economy) and would have meant 4 from Gatwick and 6 from Heathrow per day. There were plans to change to an A380 from Heathrow from June.
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UK’s smaller airports want proper government policy to boost their expansion
An article in Airport Technology makes the case for better UK aviation policy, to boost the regional airports and the smaller London airports - rather than focus only on Heathrow and Gatwick. Airports like Luton, Stansted, Birmingham and London City do not want their interests overlooked, in the ill-advised focus just on "which of two sites to put a new runway." Speaking on this at the Airport Design, Development and Engineering conference, representatives from the 4 airports reinforced their call on the government to support their expansion. They agreed that a better civil aviation policy is needed in order to build infrastructure, improve connectivity to and from the airports and "stay competitive in the fast growing, ultra-connected global aviation market." But a lot of the usual PR and spin were trotted out, and the article repeats so many of the standard claims - that airports are vital for business growth; ignoring the tourism deficit caused by ever more UK residents taking cheap overseas leisure trips; ignoring the recent growth which is largely just making up the huge declines during the recession years; making unsound comparison with China; and entirely ignoring any adverse impacts of aviation on the populations overflown, or negatively affected by the industry. There is, of course, no mention of carbon emissions. The industry is great at self-promotion, and only seeing one side of an argument.
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Virgin Atlantic and LanzaTech hope to produce jet fuel from waste CO from steel mills
Back in October 2011, Virgin Atlantic announced it was working with LanzaTech (which describes itself as a company that sees waste CO2 as an opportunity, not a liability) to produce a low carbon jet fuel, from waste carbon monoxide from steel works. The hope was for rapid progress. Now Richard Branson has announced that the plant has produced 1,500 US gallons of jet fuel from ‘Lanzanol’ - LanzaTech’s low carbon ethanol. The fuel is made by trapping waste gases from steel mills, and "fermenting" them in a manner that is not described, to produce ethanol. (Some work at Stanford University in 2014 suggested CO and water could be combined to make ethanol using a specially formulated copper catalyst. Link ) Virgin says the alcohol can be converted (not a cheap process) into jet fuel, and hopes it will "result in carbon savings of 65% compared to conventional jet fuel." A benefit would be if the CO2 is not released from the chimneys of steel mills into the atmosphere. Virgin hopes for a "proving flight" in 2017 using the fuel, and in due course LanzaTech would fund and build their first commercial jet fuel plant "hopefully in the UK, to supply fuel to Virgin Atlantic and other airlines." And then that there might eventually be "15 billion gallons of jet fuel per year." There is no obvious reason, if this sort of fuel can be made, why it would be for aviation - rather than for important terrestrial uses.
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WTO rules that EU unfairly subsidises Airbus ($10 bn per year) – but US subsidises Boeing too
The long-running battle over immense state subsidies to aircraft makers Airbus and Boeing has intensified - the World Trade Organization ruled that European governments had failed to comply with rulings that it should cut subsidies to Airbus. Both plane makers have taken complaints to the WTO about subsidies supplied by the other. The WTO is yet to rule on a similar EU complaint that Boeing benefits from billions of dollars in tax breaks in the US. The complaints are because the industries get unfair assistance, are always bailed out, and the success of either one could lead to lower sales (and fewer jobs) for the other. The state subsidies for these two vast companies mean planes are a bit cheaper than they might otherwise be. Airbus said it would appeal the judgment and the EU said it found some of the findings “unsatisfactory”. There may be issues of state subsidies by other plane makers, in countries such as Russia and China, in future. Bombardier has had subsidies from the Canadian government. In June 2011, the WTO found that the EU and four of its member countries provided billions of dollars in subsidised financing to Airbus, and the recent ruling is the final part of that. The EU had argued that the most recent Airbus jet, the A350, fell outside the case, but that was rejected by the WTO which said funding for the jet had been subsidised. The subsidies to plane makers are just one of the many ways in which the aviation sector is helped, making the cost of flying artificially low.