General News
Below are links to stories of general interest in relation to aviation and airports.
Lowcost Holidays goes into administration – partly due to effect of Brexit vote
Holiday booking company Lowcost Travelgroup has gone into administration, and ceased trading, as uncertainty ahead of the EU referendum and the fall in the pound were blamed for its demise. The group has 27,000 holiday makers in resorts and 110,000 more with bookings. There is a loss of 120 jobs in the UK, from its headquarters at Crawley near Gatwick. The staff have been made redundant. Most of the company's 451 staff were in Poland. Smith & Williamson and CMB Partners were appointed administrators after the firm's own rescue attempts failed. Their efforts had been "hampered by the recent and ongoing turbulent financial environment". Intense competition had caused the collapse but also the increased terror threat in several countries, and the uncertainty before and after the recent EU referendum. Before the referendum, holiday makers delayed decisions. The fall in the value of the £ against the € has made holidays significantly more expensive. The future is highly uncertain for how airlines will work between the UK and Europe. About 60% of Lowcost Travelgroup customers were British. This sort of very low cost holiday makes only tiny profit margins, and is very vulnerable to changes in circumstances. It is not a very secure industry.
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Heathrow Airport expansion in doubt after Theresa May promotes critics to top cabinet posts
A 3rd Heathrow runway appears increasingly unlikely after Theresa May appointed to her Cabinet a series of opponents to it. Justine Greening, the new Education Secretary, has said building another runway at Heathrow is not a “smart decision” while Philip Hammond and Boris Johnson have also been opposed. Chris Grayling, who is now the Transport Secretary, replacing Patrick McLoughlin,has voiced few public opinions on airport expansion in recent years – though probably privately backed Heathrow in 2009. He will now help oversee the decision on whether Heathrow or Gatwick is chosen for expansion. Whether the option of not choosing either, which would be the sensible decision, is also being reconsidered is not known. Both David Cameron and George Osborne were keen on a Heathrow runway - indeed it was likely that a decision to approve it would have been taken days after a "Remain" vote in the EU Referendum - are now both just backbenchers. Boris Johnson, who has said he would "lie down in front of the bulldozers" if Heathrow built a runway, would face calls to resign if he remained in a Cabinet that backed the project. Philip Hammond, the new Chancellor, said last year: “London's role as an international air transport hub can be maintained without additional runways at Heathrow. A second runway at Gatwick, plus enhanced transport links between the airports and better transport links to London will create a ‘virtual’ hub airport, maintaining Heathrow's role in the local economy without expanding it.”
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Theresa May urged to ‘quickly rule out’ Heathrow expansion by Hounslow Conservatives
Theresa May has been urged to quickly rule out a third runway at Heathrow by the leader of Hounslow Council 's Conservative opposition group. She has already made radical changes to her Cabinet, and had demands to show her hand over airport expansion. Councillor Peter Thompson, leader of Hounslow Conservative Group, said: "I hope that the new PM will quickly rule out a third Heathrow runway. As a local MP she knows only too well that Heathrow expansion would be noisy, polluting and damaging to local communities." Ms May's Maidenhead constituency is close to Heathrow and she has previously raised concerns about noise, night flights and pollution. But she recently told the Evening Standard she would not declare her preference ahead of a formal Cabinet decision on the matter. Transport secretary Patrick McLoughlin [replaced on 14th July by Chris Grayling] said following the EU referendum that a decision on airport expansion would now have to wait until October. Mr Thompson said: "Theresa May started her political life as a local councillor, serving on the London Borough of Merton for eight years – so she knows the vital role that councillors play in building a better Britain. The arrival in the Cabinet of Boris Johnson as Foreign Secretary, as well as the movement of Philip Hammond to Chancellor, and Justine Greening to Education, may make approval of a Heathrow runway more difficult.
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Patrick McLoughlin just before being moved from Transport. With Theresa May becoming PM, [ previous ]Transport Secretary urges quick decision on South East runway
Patrick McLoughlin has said Theresa May must get on and make a runway decision quickly, if the timetable to get the runway built - by 2030 - is not to slip. He said: "So long as we can get a decision as quickly as we can in October, we can still stick to the timetable that was set out in Davies." He said the decision was for the Prime Minister, and "Parliament rises next week so in all honesty I still think we're probably looking at around about the October period. I don't think this is a decision that could be made when Parliament is not sitting." Parliament does sit from 5th to 15th September. On 30th June he had said: ‘Clearly any announcement on airports capacity would have to be made with the House in session and, being realistic given recent events, I cannot now foresee an announcement until at least October.’ He said in February: “Basically, there are 6 months for the planning inquiry and examination in public; 3 months for the planning inspector to report to the Secretary of State; 3 months for the Secretary of State to consider, report and announce a decision; a 6-week period for any potential judicial reviews; and within that period there are also parliamentary occasions when Parliament can take a vote on the issues.” The timetable the government is working to is a runway by 2030, though Heathrow and Gatwick would prefer it to be by 2025.
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SSE tells Stansted airport to publish the evidence it is using to try to restrict compensation claims
Following the publication by Stansted Airport of the process it will adopt to deal with long overdue compensation payments for local residents, Stop Stansted Expansion (SSE) has accused it of unreasonably seeking to deter thousands of local residents who may well have a valid compensation claim, from even submitting one. As part of its 'Guide to Residents' on submitting compensation claims, Stansted has published a map which shows an incredibly small 'eligibility area' – with no explanation as to the basis for this. SSE says there is absolutely no legal basis for eligibility for compensation to be thus restricted. The law only requires claimants to demonstrate that the value of their property has been reduced by physical factors (noise, air pollution etc.) arising from the airport expansion. This came about because of infrastructure that enabled the airport's passenger throughput to triple in the space of the 8 years leading up to 2007. The limited area includes just a few hundred homes, but the full area includes many thousands of homes that have lost a significant amount of value. Stansted residents have only received any compensation for expansion much earlier, in the 1990s. SSE is advising people not to be deterred, and it will be asking Stansted for a lot more clarification of the legal basis for its attempt to limit claims.
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Aircraft noise and mental well-being – the looming challenge only starting to be acknowledged
Chris spoke movingly at the event held at the House of Commons, on 4th July, about his experiences of dealing with both mental health problems and the unwanted imposition of aircraft noise from Heathrow flights near his home. In a blog, Chris explains some of the issues of depression, especially serious depression, its impacts on other family members and the time people can take to get well. Many people with mental ill-health are vulnerable to noise, and noise sensitive. Through no fault of their own, other than choosing to live in the wrong place, people can find themselves subjected to relentless intrusive plane noise, that causes stress, anxiety and depression. Having moved to a quite area, to recover from illness, Heathrow changed flight path use, so Chris's home was intensely overflown. The anxiety this cause was made worse as there was no proper information or reassurance from anyone about what was going on, or why, or when it might stop. Worse still, it was unclear what, if anything, anyone affected could, do to try and protect themselves. As well as annoyance, eventually the feeling of powerlessness, having no legal remedies, and the perceived lack of fairness about the situation, lead to a crushing sense of helplessness. For those with mental conditions, this can have dangerous - even life threatening - results. The seriousness of the noise problem, especially for those already susceptible to depression, needs to be acknowledged. The issue of people who are vulnerable to noise should not be ignored any longer.
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Howard Davies makes more dodgy claims about necessity of building a 3rd Heathrow runway, regardless of Brexit
After the Brexit vote, there are very real uncertainties about the demand for air travel in future decades. Agreements need to be worked out between the UK and Europe, and this includes the Open Skies agreement between the UK and the US. These could take several years to work out. The Airports Commission gave absolutely no consideration to the possibility of Brexit. However, instead of sensibly deciding to delay a runway decision, Sir Howard Davies (as ever appearing oblivious of the many and serious deficiencies of his Commission's report) is pushing hard, in the media, for a Heathrow runway. These claims are dangerous. Howard Davies says the economic case for a 3rd runway has been strengthened by the Brexit vote; "there are already signs of a slowdown in inward investment, which the project would help to offset." .. The UK "needs some forward-looking decisions to create a sense of momentum, and the construction industry....will soon need the work." Some businesses see not building the runway as "a symbol of a lack of interest in Britain’s links with the wider world." He says a Brexit choice is "presented by our competitors as an insular move. An early runway decision would do a lot to offset that impression. I hope the cabinet can be brought to see that argument as soon as possible... " ... "If you say your strategy is to be a global trading nation reaching out to China and India, but actually you aren’t prepared to provide any airport capacity for people to land here, then that’s a joke.”
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Airbus running out of buyers for its A380s – just breaking even with only 126 orders
An article by Bloomberg looks at the A380, and Airbus's failure to sell enough of them. It has been a financial failure. Not a single US airline has bought one; Japanese airlines have just a few; the only real user is Emirates, with 81 flying and an additional 61 reserved, which is 45% percent of the A380s delivered or on order. Airbus has delivered 193 A380s—early on it predicted airlines would buy 1,200 over two decades—and has only 126 in its order book, to be built over the next five years or so. Most airlines don't want planes with 4 engines that burn so much fuel. Airbus knows it will never recoup the €25 billion it spent on development. If it produces fewer than 30 planes a year, the program could fall back into the red. "Axing the A380 outright is hard to do. Besides the embarrassment of admitting defeat on the program, Airbus would need to write off factories across Europe and redeploy thousands of workers. Airlines would see the resale value of their A380s plummet, and the plane’s demise would leave airports worldwide questioning the wisdom of facilities constructed to accommodate it; Dubai, for instance, built a dedicated terminal for the A380." The A380 has largely sucked the life out of Boeing 747, with just 40 sold since 2012 and 11 more on order.
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Brexit vote causes anxiety about weakening of UK environmental regulation
In the wake of the Brexit vote, there has been speculation about the effect of the UK leaving the EU on environmental regulations. The lawyers, ClientEarth, fear that environmental protections may be weakened, and ask politicians of all parties "to affirm their commitment to strong UK environmental laws and to guarantee united action on climate change, despite our upcoming exit from the EU." Client Earth says many of the laws they use to ensure that nature and health are protected in Britain were drawn up with the UK’s agreement in Brussels. During the referendum campaign, no one made clear which environmental laws would be kept. ClientEarth have taken action on air pollution, but Brexit could mean air quality laws, with which the UK has failed to comply, could be weakened or scrapped. Taking action through the courts may be harder. Some of the key legislation for aviation has been developed at a national level, independently of the EU, most notably the Climate Change Act (2008). Maintaining full access to the Single Market may, in any case, require the UK to demonstrate compliance with EU environmental legislation, including having to abide by the Environmental Noise Directive and Ambient Air Quality Directive. Brussels-based green NGOs have urged the European Commission to push on with its 2030 climate legislation – despite the uncertainty in the wake of the UK Brexit vote.
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Euromonitor expects Brexit will ‘lead to loss of 2.3 million visitors to UK’ by 2020
Market researcher Euromonitor is predicting 2.3 million fewer visitors to the UK over the 5 years up to 2020 following the UK's Brexit vote. Euromonitor (a leading global independent provider of strategic market research) forecast a 2% drop in GDP over the next 5 years, with the biggest impact felt in 2017. They do not expect GDP to return to the baseline until 2023. Euromonitor says the UK ranked 6th globally in 2015 as a destination country. The UK is highly dependent on European tourists, with around 73% of all inbound tourism in 2015. The largest number of visits to the UK is from France (3.7 million in 2015) and they are fairly resilient to price changes. But based on what happened in the recession, Euromonitor anticipates that there may be less demand from Germany and the US, with perhaps half a million less visitors from each till 2020. Due to the likely fall in the value of the £ against the € and the $, trips will be more expensive for Brits going abroad. However, this could make trips cheaper for visitors coming to the UK - but this effect will be over-ridden as there are more outbound than inbound trips. It took 8 years for the UK travel demand to rebound after the 2008 recession. IATA has warned that UK air passenger numbers could decline 3% – 5% by 2020 due to airline uncertainties and fall in the £.