General News
Below are links to stories of general interest in relation to aviation and airports.
How many flights does Heathrow actually have to the emerging economies?
There have been letters in the Sunday Times and in the Sunday Telegraph from lists of business people, in support of airport expansion in the south east, and demanding reconsideration of a third runway at Heathrow. They claim that Heathrow is lagging behind Schiphol, Paris Charles de Gaulle and Frankfurt airport in the number of flights to the emerging and rapidly growing economies. And that therefore the UK will be condemned to an economic backwater if vast amounts of concrete are not poured, and another runway is not provided. But what is the actual situation? Are there really not enough flights to emerging economies from Heathrow? Are the numbers to some destinations low just because there really is not the demand (however much UK business might like there to be the demand)? We investigate what flights there really are from Heathrow already.
Click here to view full story...
“London First” gets their letter, signed by over 40 business people, in the Sunday Times
This is a second letter, this time in the Sunday Times, with a load of business people adding their voice to the lobby group, London First. They are asking Justine Greening to include Heathrow in the forthcoming aviation consultation. What they really want is a third runway at Heathrow. If needs be, they say extra noise from a new Heathrow runway or Heathrow expansion should be mitigated. The myth is again pushed that - in some unexplained way - the UK will suffer economically if there are not enough direct flights to China. There is never any evidence presented to back this up. In reality, Heathrow has excellent connections to the world. Where there are few flights to a destination, it is because there is not enough demand. Many of Heathrow's flights are predominantly filled with leisure travellers, eg. the approximately 21 flights per day to Miami from Heathrow.
Click here to view full story...
BAA “fighting yesterday’s battles with the day before’s arguments” in an attempt to revive Heathrow Third Runway
On March 6th BAA is expected to release a report it commissioned from Oxford Economics which will argue that the UK risks losing trade and inward investment if Heathrow does not expand. The report seeks to influence the Government’s draft aviation strategy which is expected to go out to public consultation towards the end of this month. HACAN says there is no compelling economic case for a third runway at Heathrow. BAA will not accept that the current Government rejected both the environmental and economic case for Heathrow expansion. It’s a sign of its desperation that it has wheeled out Oxford Economics to do the report. These were the consultants who provided the economic basis for the now discredited 2003 Air Transport White Paper.
Click here to view full story...
Letter from business people in Sunday Telegraph lobbying for airport expansion
A group of business people from the business world, some from large organisations and some from apparently tiny ones, have written an open letter published in the Sunday Telegraph, on airport capacity. This letter is part of a campaign by the aviation industry and its supporters, in the run up to the start of the government consultation on future UK aviation policy that starts at the end of this month. There will be many more of these publicity grabs this month, and in the months to come. The letter reiterates the myth that the UK will somehow sink to being an economic backwater if the south east does not have an extra runway, if there is not a larger hub for flights to China etc etc. What is interesting is that repeatedly the industry does not appear to have any actual statistics to back up their claims. Self interest, rather than the wider good, appears to be the underlying motive.
Click here to view full story...
“Fair Tax on Flying” – the aviation industry lobby group – is complaining about APD, yet again
Fair Tax on Flying is at it again. They are resurrecting their rather unsuccessful , and entirely self-serving, campaign last year, to lobby government to cut Air Passenger Duty. The campaign's members are all airlines, airports, travel companies that make their money out of people flying, and the more passengers they get, the happier they are. There are the usual claims about how catastrophic the tax is for the UK economy, (£13 for a return flight to anywhere in Europe), rising to higher levels for longer flights. Their rather unsuccessful Facebook page is back in use. Bit like deja vu. They did just about the same thing last March, with little effect on the Chancellor. In effect, the aviation industry is under-taxed, even with APD. The industry pays no VAT and no fuel tax, unlike road vehicles. This huge subsidy (the benefits the aviation industry by around £9 billion per year in the UK) effectively distorts the travel market, and deprives the Exchequer of revenue needed for public services for UK citizens.
Click here to view full story...
Bmi to be ‘integrated quickly’ into British Airways
British Airways owner IAG has agreed a binding deal to buy BMI from Lufthansa - including their 56 slots (8.5% of Heathrow's total) at Heathrow - for £172.5m, but has warned the deal could lead to job losses. Virgin opposes the take over, as they also wanted to buy BMI. BMI now employs more than 3,600 staff, but reported a £153m loss in the year to 2010. IAG and Lufthansa have agreed a purchase price of £172.5 million, but this is subject to heavy price reduction if Lufthansa does not choose to sell its budget arm BMIbaby before completion of the sale. The deal remains subject to clearance by competition bodies.
Click here to view full story...
Willie Walsh makes yet another attempt to get APD cut, this time using the Olympics as the excuse
Willie Walsh has used the occasion of the IAG Full Year Results for 2011 as a justification for not only a stab at intimidating the government to rethink its rejection of a third runway at Heathrow, but also to have another go at APD. He claims, using some slightly questionable figures, that APD will cut the number of Olympic visitors (has he seen the way London hoteliers have hiked their prices in order to profiteer during the Games?) and that APD will reduce the number of extra staff BA or IAG employ this year. He claims - or implies - that IAG would employ an extra 800 staff this year ..... (they only employed an extra 228 staff in 2011 when profits increased 5 fold) but can only employ 400 instead. The figure of 400 is not backed up by any evidence. He also claims BA's unit fuel costs rose 21% in 2011. IATA data on jet fuel price showed it was at most a 17.8% increase.
Click here to view full story...
BA to increase ticket prices due to rise in cost of oil, and expect fewer business passengers during Olympics
BA says it will increase its ticket price this year, due to the rising price of oil. IAG had paid 29% more for fuel in 2011 than in 2010, paying £4.2billion. This had caused IAG to raise passenger fares by up to 3.5%. Willie Walsh said the price of oil had "gone beyond spikes now. We are seeing a big structural shift in the cost of oil,” and predicted an extra £1billion rise in its fuel bill this year, resulting in further fare rises. He claims APD will cut the number of staff the airlines will take on - with no figures to back up this claim. BA expects profits to be lower during the Olympics, as business travellers will reschedule to avoid the Olympics. "Though the Games will be positive for the long-term position of London as a global destination, experience in other host cities suggests that demand could be dampened."
Click here to view full story...
Willie Walsh, Head of IAG, wants government to rethink their rejection of Heathrow 3rd runway
The FT reports that Willie Walsh, head of IAG, has challenged the government to review its decision not to allow a third runway at Heathrow. He wants a major hub with 4 runways eventually. BAA claims the UK could miss out on trade worth at least £14bn over the next decade because Heathrow is operating close to its maximum capacity. Andrew Haines, chief executive of the CAA, says an estuary airport with all the necessary extra new infrastructure would probably not be viable without state subsidy. If there was no subsidy, airports would need to charge much higher landing fees, in order to pay for the new airport building, and this would be opposed by airlines, and increase ticket prices. NATS is concerned that both Heathrow and an estuary airport cannot be in use at the same time, due to flight path problems.
Click here to view full story...
Even if people prefer a 3rd runway to Boris Island, it doesn’t mean they like either
An ICM poll commissioned by the Institution of Mechanical Engineers, on attitudes to a third Heathrow runway, or an estuary airport, says that a 3rd runway was favoured by 25% of respondents, with 21% backing the new airport. When asked if they believed the Government was right to block Heathrow’s 3rd runway, 35% agreed while 32% thought it was the wrong decision. And it says "The Government needs to urgently rethink its decision to rule out any potential expansion at Heathrow, Gatwick or Stansted, which all offer more sensible and cost-effective alternatives". John Stewart writes that this poll is yet another attempt to avoid the real debate about whether any further airport capacity is required in the South East. It is part of a coordinated series of publications by the aviation industry and its allies intended to influence the government’s draft aviation policy due to go out to public consultation at the end of this month.