General News
Below are links to stories of general interest in relation to aviation and airports.
Heathrow airport plans in relation to the reservoirs that supply part of London’s water
Plans drawn up by Heathrow airport, or others, to show indicative locations for new runways to the south and west show them in the areas where reservoirs are now. There are the Queen Mother reservoir; the Wraysbury; the King George VI; and the Staines reservoirs. Together they are an important water resource for London, for which water requirements grow each year as the city's population increases. There are huge technical problems in building a runway across part of an important reservoir, the ground levels being one. With climate change likely to make future water supplies less predictable, Thames Water anticipates that there will be a slight drop, of perhaps 5%, in its water availability in 2040 compared to 2012. Meanwhile it forecast "a total increase in population in our area of between 2.0 million and 2.9 million people by 2040 – three quarters of which is forecast in London. Overall, we forecast household water demand to increase by approximately 250 Ml/d" (mega litres per day). Household water is only one sector using water. Creating a huge new reservoir to replace one removed by a Heathrow runway would be an immense undertaking. One was proposed, and rejected, near Abingdon, in 2011. Even transporting water into the Thames from the Severn would have huge costs and environmental implications.
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Heathrow residents fears as 3rd runway threatens homes and their communities’ futures
Barely three years after plans for a third runway were scrapped by the incoming government and abandoned by Heathrow, the airport has restated its case and returned with even bolder expansion plans. One local historian living in Stanwell remembered the Terminal 4 inquiry: "I sat in the room for the Terminal 4 inquiry – not even Terminal 5 – and the planning inspector said, 'Ladies and gentlemen, I can promise you this is the very last one.' You can't believe them when they say this is the end." According to a single well-placed source, the draft shortlist to be presented by the Airports Commission on 17th December contained three options, each including a Heathrow runway. People due to be badly affected if Heathrow is allowed a runway fear it will "swallow up the borough". Although Stanwell Moor is threatened with total destruction, the people in its 850 homes will be compensated and can move away – regarded by some, at least, as better than being trapped in unsaleable houses. A local councillor said: "I liken it to a funeral – it's not so much the people who die as the ones who are left behind." Communities both to the north and the south fear the dreadful prospect of being left close to the end of a runway, but not near enough to be demolished.
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Extra runways at both Gatwick and Heathrow not viable without ‘illegal’ state aid
Gatwick has complained that “massive” and potentially illegal public subsidies would be needed to support the construction of additional runways at more than one airport in the South East. They say there will be insufficient demand from passengers to support building a second runway at Gatwick and a third at Heathrow at the same time. An injection of taxpayer funds would, therefore, be required to justify the costs, the airport said, although that could potentially breach state aid rules. Gatwick has published a report listing 10 reasons why Heathrow expansion would be bad for Britain in a last ditch attempt to persuade the Airports Commission that its own proposals should be included on a short-list to be published on Tuesday 17th. Rival airports have been growing increasingly concerned after leaks that Sir Howard is likely to short-list only 3 potential options for new runways, all including at least one at Heathrow. Charlie Cornish, chief executive of MAG, said: “We firmly believe all credible options should be considered and taken forward for more detailed assessment during the next phase of the process. This is not, and should not be a two horse race."
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Report by Hounslow, Ealing and Slough councils says Heathrow closure would create 70,000 job losses
A new report commissioned by the London boroughs of Hounslow, Ealing and Slough Borough Council into the economic effect of Heathrow on the area, and the likely repercussions if it was to close. The report concludes that if Heathrow was to close, "up to 70,000 jobs across 3 boroughs neighbouring Heathrow would vanish, with devastating economic consequences, if the airport were to close in favour of a new hub airport elsewhere." The three local authorities, all of which have differing positions on the future of Heathrow, were concerned that the local impact of any decision was not being given sufficient weight in the deliberations into how to increase airport capacity in the south east. The report, by Parsons Brinkerhof and Berkeley Hanover Consulting, sets out 6 possible scenarios for the airport - but it came out just before the Airports Commission leak indicating that it proposes one - or even two - Heathrow runways, with no suggestion whatsoever of it closing. The report contains estimates of the number of direct and catalysed jobs, caused by Heathrow, or proximity to it. The Leader of Ealing Council, said: “Thousands of local families depend on Heathrow for their livelihoods and the airport plays a critical role in the local economy. Closing it should not be contemplated." It would appear that its closure is, indeed, not being contemplated. At all.
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David Cameron had talks with Sir Howard Davies as a row looms over leaked new runway proposals
Sky News reports that David Cameron has held a secret summit on 11th December with Sir Howard Davies in the run-up to the interim announcement on 17th December, due to the anticipated row generated by the report being leaked. It has been revealed that the report will shortlist just 3 favoured options, each of which includes the construction of at least one new runway at Heathrow. Boris has expressed his fury that Heathrow has been chosen, for not only one - but 3 - options. Sky says "People close to the Commission's work said that Sir Howard had been irritated by the speculation, suggesting that much of it had been inaccurate." As Gatwick has said there would be no point in them building a 2nd runway if Heathrow builds one, that leaves only 2 out of the 3 recommended options (ie. a 3rd runway, or a 3rd + 4th). Mr Cameron is understood to have urged Sir Howard to include in next week's report an alternative option not involving Heathrow. ie. perhaps estuary or Stansted, though the Commission has thoughts against both of these. However, the Airports Commission is meant to be independent; it is not meant to carry out the government's instructions. Sir Howard met George Osborne earlier this week, and Sky says Boris met Patrick McLoughlin on 12th to discuss a range of issues including the Airports Commission's review.
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Labour denies Heathrow third runway U-turn – but there has been a shift away from opposition
Labour has played down reports that Ed Miliband is set to abandon his opposition to a 3rd Heathrow runway. But he is under pressure from the shadow chancellor Ed Balls to be more supportive when the Airports Commission reports next week (though the report has been leaked already). A parliamentary row has been brewing over claims that No 10 has pressured the Commission into keeping a broader shortlist to avoid an early row focused on Heathrow - though Heathrow appears to be the main focus. Ed Balls in a recent speech to the CBI said he would like to see the Airports Commission make recommendations before the general election. The party's previous shadow transport secretary, Maria Eagle, was shifted in the recent shadow cabinet reshuffle partly due to disagreements with Balls over HS2 and Heathrow. Eagle's replacement as shadow transport secretary, Mary Creagh, has tried to be non-committal towards the Airports Commission, saying: "No party can say now that it will implement its recommendations when we simply don't know what the costs of any proposals will be. Obviously the Conservatives and Lib Dems haven't made any such commitments." She said Labour would not rule any runway options in or out while the Commission was still deliberating.
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Boris Johnson’s warfare threat if Airports Commission report pushes “catastrophic mistake” of Heathrow expansion
Boris has threatened open warfare against the Airports Commission if it makes the “catastrophic mistake” of pushing for Heathrow expansion, in its interim report. He launched a pre-emptive strike after it emerged that commission head Sir Howard Davies has briefed senior Government figures (including Osborne) a few days ago, a week in advance of the report's launch, that it opposes every runway option other than Heathrow. The leaks indicate that Sir Howard indicated he planned a shortlist of three options, all of which involved expanding Heathrow. The first was to revive a 3rd runway, which David Cameron originally pledged to stop, only to change his mind in the face of business pressure. Option two was to approve Heathrow’s latest expansion blueprint, for 2 extra runways. Option three was one extra runway at Heathrow plus one extra runway at Gatwick. Speaking from Doha where he is on a trade mission, Boris said: “I cannot conceivably believe that Howard Davies would inflict the misery of a 3rd runway at Heathrow, let alone a 4th, on a million people or more in west London." Mind you, Boris still wants his mega airport in the Thames estuary. The Standard says: Mr Johnson’s mood was said to be of shock and incredulity — but also a “steely resolve” to fight the plan.
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Gatwick chairman says Gatwick could not get their money back on a 2nd runway if Heathrow builds a 3rd
Gatwick's Chairman says it will not build a second runway if the British government allows a simultaneous expansion at Heathrow. Roy McNulty said building a Gatwick 2nd runway was a "bet the company type of investment" and the timescale of getting returns on the project would double if Heathrow was allowed to expand at the same time. He said Gatwick would also be wary if it was only allowed to expand sometime after Heathrow constructed a 3rd runway. Heathrow would remove the traffic Gatwick would need to run a new runway profitably. His comments were prompted by the leak, a week early, of the Airports Commission's interim report and its shortlist of schemes for new runways - all of which appear to involve another runway at Heathrow. Gatwick, owned by GIP (who are likely to want to sell it before 2020) suggested in July that they could build a new runway for around £9 billion, rather than over £14 billion for one at Heathrow. lt could take a decade to build either - if they could indeed ever get planning permission and meet all social and environmental constraints.
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Airlines increasingly using capital markets, rather than banks, to fund plane purchases
Globally airlines are buying passenger planes at huge cost. This year they may spend $104 billion this year, and $112 billion in 2014. Banks and export credit agencies have been the main source of aircraft financing in the past. They are retreating from this sector, due to having stricter regulations on minimum capital requirements, and also government restrictions on export credit. So airlines are finding more diverse funding sources. They are making greater use of capital markets, and pension funds, to fund purchases of aircraft. American airlines have used asset-backed bonds for many years, but now others including BA are starting to do so. They have issued asset-backed bonds called Enhanced Equipment Trust Certificates to finance the purchase of new aircraft. Boeing estimated that capital markets will provide 14% of aircraft financing this year, and 22% in 2014 – compared with just 3% in 2010. Boeing said export credit-backed funding fell from 31% of aircraft financing in 2010 to 23% in 2013 and 18% in 2014. Borrowing from banks was around 30% of the total before 2008, but will be around 25% in 2014, with less from European banks and more from Chinese and Japanese banks.
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Heathrow campaigners furious over leak that Sir Howard Davies is backing 2 new runways at Heathrow
Heathrow campaigners have reacted with anger and disbelief to the leaked news that the Airports Commission Interim Report, which is due to be published on 17th December, favours 2 more runways at Heathrow. From the leaks, the Commission is expected to go for a 3rd runway at Heathrow followed by a 4th Heathrow runway or a second runway at Gatwick. The draft of the report, presented to Chancellor George Osborne, ruled out new runways at Stansted or an Estuary Airport. It is thought, however, that Tuesday’s report may formally retain more options in an attempt to give it some balance. This news will cause fury across whole swathes of London and the Home Counties. with the Airports Commission's work over the next two years in selecting from its "short list" seen as a "busted flush” with its decision already taken. John Stewart, Chair of HACAN - which represents residents under the Heathrow flight paths, said: “It is astonishing that Davies has put so much faith in an option he must know is politically the hardest to deliver. The one good thing is that he will force political parties to come out for or against a 3rd runway before the 2015 General Election.” Another Heathrow runway means thousands of people stand to lose their homes. They are not going to stand by and let that happen. The campaign against a 3rd runway starts today.