General News
Below are links to stories of general interest in relation to aviation and airports.
CAA approve various airspace changes, but review of the airspace change process is under way
The CAA has the ultimate ability to approve changes to airspace and flight paths. There is a long process through which proposed changes have to go, including development of the proposal, the preparation of the public consultation, collating and analysing the responses, modifying the airspace design if necessary, providing feedback to consultees, decision by the CAA, implementation of the change, and then operational review a year after its introduction. There is currently a review under way, by the aviation consultancy, Helios, of the CAA's process for changing use of airspace. It is looking at strengths/weaknesses in the process, possible improvements, including better transparency and accountability. Before any reform of the airspace change process is implemented, the CAA will hold a public consultation - expected before spring 2016. Meanwhile, the CAA has approved some airspace changes, covering eastern and southern England. They say these "will enable aircraft to fly more efficiently, help reduce the number of low-level flights and reduce the environmental impact of aviation." The aim is to save money/fuel for airlines, and thus reduce CO2 emissions. The intention is also, where possible, to slightly reduce noise exposure.
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Chancellor says there will be a £300 million “Transport Development Fund” for “transformative transport infrastructure projects”?
The Autumn Statement and Spending Review, by the Chancellor did not have anything to say about Air Passenger Duty, so fortunately it has not been cut again. Due to the amalgamation of the distance bands, from 1st April 2015, so any trip of over 2,000 pays the same amount of APD - and the removal of APD for children (those under 12 from May 2015, and those under 16 from May 2016) the receipts to the Treasury from APD are lower than anticipated several years ago. The forecast receipts from APD in 2018/19 are now £.0.8 billion lower than forecast in the Autumn Statement in 2013. There is no mention of a new runway in the Autumn Statement, and no money set aside for road or rail work associated with it. However, "The Spending Review and Autumn Statement provides £300 million over the next 5 years for a new Transport Development Fund, for the next generation of transport infrastructure projects. This could include providing development funding for projects such as Crossrail 2 and proposals emerging from the Northern Transport Strategy, following advice from the NIC at Budget 2016. [NIC is the National Infrastructure Commission, under Lord Adonis. It is in theory not looking at airport-related issues]. The DfT will have a 37% cut in its operating budget, though the aviation section is thought to have a 30% increase for runway delivery.
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Gatwick continues to make around 1/3 of its income from retail + car parking
Gatwick airport had slightly more passengers this year (+5.7%) than 2014, though the additional number of flights is small (+2.6%). The Moodie Report says in the 6 months March to September 2015, Gatwick had 3.5 million passengers (+4.7% year-on-year), and it had a +5.2% rise in revenues to £411.8 million. This resulted in a +6.8% rise in EBITDA to £241.0 million and a pre-tax profit of £135.2 million on a consolidated basis. Gatwick's aeronautical revenues (income from flying, mainly landing charges) rose by 5.1% to £228.9 million, due to a 4.7% increase in departing passengers. Gatwick's retail income rose +1.4% to £85.5 million but, importantly, net income per passenger decreased by -3.0% to £3.60 due to “challenging trading” in the duty free and tax free category. Income from duty free and tax free declined by -2.5% period-on-period. On food & drinks Gatwick made +2% more per passenger than the year before. Car parking income rose +7.4% to £47.7 million and net income per passenger for car parking increased +11.9% to £1.60. So Gatwick makes 56.6% of its income from aeronautical revenues [it as 53.5% in 2013/14]; it makes 20.8% of its income from retail; it makes 11.6% from car parking, and about 11% from "other." Like Heathrow, Gatwick would struggle without the car parking and the shopping, which made up about 32% of its income.
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Willie Walsh tells AOA conference Heathrow’s runway is too expensive, and at that price, would fail
The Airport Operators Association is holding a two day conference on the runway issue, and Willie Walsh (CEO of IAG) was its key speaker. He said Heathrow should not get a 3rd runway, if the Airport Commission's calculation of the cost of building it is correct. He said: "The Commission got its figures wrong – they are over-inflated. If that is the cost [of a new runway], it won't be a successful project." He described the assumption that airlines would pay for the new runway through increases in fares as "outrageous". British Airways is by far the biggest airline at Heathrow, with 55% of the slots. He said of the Commission's report: " ... I have concerns about the level of cost associated with the main recommendation and the expectation that the industry can afford to pay for Heathrow's expansion." He does not believe the cost is justified, and "If the cost of using an expanded airport significantly exceeds the costs of competitor airports, people won't use it." It was not realistic for airlines: "You have to see it in terms of return on capital. ....Either the figures are inflated or you are building inefficient infrastructure. I do not endorse the findings. I definitely don't support the costs of building a runway. If those costs are real, we should not build it." On the cost of £8 billion to build a 6th terminal he commented: "How many chandeliers can you have in an airport terminal?
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Sadiq Khan backs Gatwick runway (+ London City Airport expansion) knowing he’d have no chance of being Mayor backing Heathrow
Labour mayoral candidate Sadiq Khan (MP for Tooting) had decided he will back a 2nd Gatwick runway, knowing he would have no chance of being elected mayor if he did anything other than oppose a Heathrow runway. He has done a publicity stunt, charm offensive, visit to Gatwick, being given the celebrity treatment. His view is to prevent the noise, air pollution, congestion etc problems caused by expanding Heathrow, and instead make "Heathrow better, not bigger”. Previously he backed a Heathrow runway, until realising he could not maintain that line and have any chance of being London Mayor. He has also recently said he would consider allowing the expansion of London City Airport if he took over at City Hall. Boris had blocked expansion earlier this year, on noise grounds. The London City scheme, if approved, would increase the number of flights from 70,000 to 111,000 per year, doubling the annual number of passengers by 2023, as well as extending the terminal and building a parallel taxiing lane. He said London City Airport was "a special case because of its size and economic impact." Bearing in mind his support for Gatwick, he appeared oblivious of the irony of this statement: "I think what you can’t do is play politics with decisions about people’s jobs and business."
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Though Gatwick number of passengers is up 5.7% this year on 2014, the number of flights only up by 2.6%
Gatwick Area Conservation Campaign (GACC) says that use of larger planes, and with fewer empty seats, explained how Gatwick has a record-breaking 40 million passengers per year. Gatwick has been expanding its passenger numbers as fast as possible, in its bid to get another runway. The Airports Commission estimated, based on past trends, that it would not reach 40 million passengers per year for many more years. But Gatwick has not increased the number of air transport movements (flights) by much. While the number of passengers link in the 12 months to October 2015 is 5.7% higher than the previous 12 months, the number of flights was only 2.6% more. GACC said it is the number of landings and take-offs (air transport movements - ATMs)which create a need for a new runway, not just the number of passengers. The load factor (how full the plane is) is higher, with the figure is October 2015 being 85.3% compared to 82.2% in October 2012 or 81.7% in October 2013. GACC chairman Brendon Sewill said: “At this rate of growth Gatwick and Stansted and Luton won’t be full for at least fifty years!” In fact, Gatwick had more flights in 2007 than in 2014. There were about 256,000 ATMs in 2008, 259,000 in 2007 and 255,000 in 2014. The average number of seats per plane was about 180 in 2014 and about 174 in 2013. The average number of passengers per plane was about 151 in 2014 and about 145 in 2013.
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Garuda to move its Gatwick flights to Heathrow; Vietnam Airlines did the same in January
Garuda Indonesia is joining the ranks of those airlines that started life at Gatwick before defecting to Heathrow. According to CAPA, Garuda will start using its new Heathrow slots in March 2016, but there is no information on how it got the valuable Heathrow slots. Slots at Heathrow are, in theory, hard to get hold of. Garuda used to fly from Gatwick many years ago before suspending services (owing to safety restrictions, due to its bad record). It only returned to Gatwick a couple of years ago. Instead of more ambitious plans, Garuda will eventually just have direct flights to Jakarta from both London and Amsterdam. The runway at Jakarta has to be strengthened for heavy long haul planes. Currently, Garuda serves Gatwick as a "tag" to its Jakarta-Amsterdam flights. Airlines like Garuda are being out-competed by middle eastern Gulf airline rivals. Earlier in 2015 Vietnam Airlines announced it would be leaving Gatwick to launch a direct service from Heathrow instead, from March 31st 2015. This will be using Dreamliner 787s. John Holland-Kaye is, of course, pleased. It is reported that due to the shortage of Heathrow slots, the agreement between Heathrow and Vietnam Airlines took 7 years to complete, and "there are currently 30 airlines waiting for slots." Earlier long haul airlines to fail from Gatwick were Hong Kong Airlines, Air Asia X, Korean Air and US Airways.
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Group of Heathrow Community Noise Forum members express concerns about the airport’s treatment of the Forum
The Heathrow Community Noise Forum was set up earlier this year, by Heathrow, in an attempt to improve "engagement" with people affected by the airport's noise. It aims to build trust, provide information, improve understanding of Heathrow's operations, and seek communities' input. The first phase of its work has been to employ consultants to verify how accurate Webtrak is, and to see whether flight paths now are much different to before the "trials" in 2014. However, there has been some dissatisfaction from many of those attending that the Forum has not been working adequately. Eight of the groups that attend presented a statement to the meeting on 5th November, declaring their concerns. One particular matter raised was that Heathrow appears to have taken advantage of the Forum, without the consent of participants, in pressing its case for a 3rd runway. The airport has cited the existence of the Forum as evidence that it can be relied upon to engage with neighbouring communities. There have been instances where HAL has opted to publish its interpretation of analysis in the public domain, without consulting the Forum beforehand, leading some to question whether the HCNF is being used to benefit HAL's commercial ambitions. The statement requires 4 changes to how the HCNF is conducted, without which "the community groups will need to consider the value of the CNF as a mechanism to achieve their objectives".
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Stewart Wingate says Gatwick won’t give up on its 2nd runway – whatever the government says
Stewart Wingate says Gatwick will continue to push for a 2nd runway even if Heathrow gets Government backing for a runway, when (if?) the announcement is made in December. The Prime Minister has said there will be a formal response to the Airports Commission’s findings by the end of the year, though it may be by George Osborne or Patrick McLoughlin, to save Cameron having to admit his "no ifs, no buts, no 3rd runway" promise. Gatwick has spent the past four months attempting to pick holes in Sir Howard Davies' work, trying - not very successfully - convince the Government to back Gatwick instead of Heathrow. Stewart Wingate has said he thinks a Heathrow runway is undeliverable, and he will not lose his appetite to get his runway. "This is going to be a multi-year event.” He refuses to rule out legal action to block Heathrow expansion if it gets government backing. Gatwick has already examined the legality of the air quality issue, but Wingate adds: “I think there’d be other people in the queue well ahead of us” who would challenge the Government in the courts. Wingate also insists that he will “absolutely not” resign if the Government supports Heathrow, because he believes Heathrow will ultimately be refused on environmental grounds. He continues to deny the environmental problems of a Gatwick runway, which are nearly as bad as one at Heathrow.
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Critical analysis of the Airports Commission economic figures, by an Economics Professor, sent to Cabinet Members
An economics professor has assessed the claims by the Airports Commission, of huge benefits to the UK from a Heathrow runway - and found them to be very dubious indeed. He has written to members of the Cabinet, to express his concerns. Professor Len Skerratt (Brunel) believes the Commission has presumed unreliable indirect benefits to the UK national economy. He says there would not be an economic case for the 3rd runway without the supposed indirect benefits to the national economy. These wider economic benefits are said by the Commission to amount to some £131-£147 billion, between 0.65% and 0.75% of GDP by 2050. However, these predictions are not believable. There are only small predicted direct benefits, which could be as low as £11.8 billion (carbon traded model) or just £1.4 billion (carbon capped at the level suggested by the CCC). As the Commission’s own expert economic advisors (Mackie and Pearce) point out these appraisals rely on assumptions which are excessively optimistic. The Commission has gone to great lengths to quantify all the uncertain benefits, particularly the wider and often intangible economic and social benefits. Yet scant attention has been given to the certain tangible and intangible costs of serious damage to health, and quality of life in the very long term, and also the productivity loss, delays and annoyance caused by ten years of construction.