General News
Below are links to stories of general interest in relation to aviation and airports.
Government may announce a compulsory 14 day Covid quarantine period for all travellers entering the UK
UK airlines say they have been told the government will bring in a 14-day quarantine for anyone arriving in the UK from any country apart from the Republic of Ireland in response to the coronavirus pandemic. The new restriction is expected to take effect at the end of May. People arriving in the UK (plane, ship, rail) would probably have to give their name, passport details and address where they will be staying. They will have to self-isolate themselves for two weeks. How this will be enforced is not yet clear, but there could perhaps be random checks by local authority etc staff. Maybe fines if found not complying properly. It is deeply unsatisfactory that, until now, thousands of passengers arrive per day (around 10,000 per day now) and leave airports etc, with just a bit of general guidance about social distancing etc. Other countries have taken a far harder line already, but not the UK. These restrictions on movement by those arriving in the UK should have been implemented weeks ago, when the government said they were not needed. Now the airlines and airports are very angry this is being imposed, at a time when they were hoping for a return to air travel. Hardly anyone will want to go on a holiday / leisure flight, or even a business trip, with 14 day quarantine.
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Willie Walsh says Heathrow’s 3rd runway will never be built. Covid was its final straw …
Willie Walsh, head of IAG (parent company of British airways) has been a long standing opponent of a 3rd Heathrow runway. That is because it would provide more space for airline competitors of BA, and it would put up landing charges - deterring BA passengers using Heathrow. Now, with the Covid pandemic, he says plans for a 3rd runway should be abandoned totally. He does not expected air travel to return to 2019 levels until at least 2023, as there will be less demand for business and leisure travel, and people will continue to be afraid of contracting the virus. The only way to prevent more disease being brought into the country by returning air passengers is to ensure they are fully in quarantine for 14 days after their return. That would deter most air travel, if quarantine was fully enforced. Willie Walsh is also opposed to the runway plans, and it would mean compulsory purchase of BA's office building, Waterside. (Walsh jokingly says he is ready to sell it to Heathrow tomorrow ... but it not expecting they will ask any time soon). Walsh cannot see Heathrow being able to raise the necessary finance for a runway, which means adding to its already vast debt.
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Supreme Court grants Heathrow and Arora permission to appeal against the Appeal Court ruling on the ANPS
In February, the Appeal Court ruled that the government's Airports National Policy Statement (ANPS) was illegal, because it had not taken properly into account the UK's responsibilities on carbon emissions, or commitments under the Paris Agreement. For a Heathrow 3rd runway to go ahead, it has to be in line with the necessary policy document, the ANPS. That document is now invalid in law, and will remain so until it is amended to rectify its deficiencies. It is for the Secretary of State for Transport to do that, but the government declined to challenge the Appeal Court judgement. So Heathrow, and Arora Holdings (the two organisations hoping to get a 3rd runway built) asked the Supreme Court for permission to appeal the Appeal Court decision. That has now been granted, by the Supreme Court. The legal process is slow, and could take as much as a year. It will probably cost a lot of money, at a time when Heathrow is haemorrhaging money, with minimal income, due to Covid. Only a day earlier, CEO of Heathrow, John Holland-Kaye admitted there would not be a need for a 3rd runway for 10-15 years. Heathrow wants this drag on and on and on ...
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Holland-Kaye admits to Transport Committee that Heathrow runway not needed for 10 – 15 years, if things go well
Campaigners are calling for Heathrow to drop its plans for expansion, following comments made by its Chief Executive, John Holland-Kaye, to the Transport Select Committee. At the virtual hearing on Wednesday 6th May, he said a 3rd runway wouldn’t be needed for around 10 – 15 years. Holland-Kaye was asked by Lilian Greenwood MP if the crisis facing the industry caused by the Covid-19 pandemic had created a hole in the economic case for a third runway at Heathrow. He said he was no longer thinking about the 3rd runway, but that if the UK is able to reboot the economy and demand returns to the pre-pandemic levels of flying, he believes the 3rd runway may “be needed in 10-15 years’ time.” Nobody can know at present how much air travel demand will recover in the next few years. The No 3rd Runway Coalition are calling on Heathrow to drop its plans for a third runway with immediate effect. This includes appealing a Court of Appeal ruling which stated climate targets had not been taken into account when the Government prepared the Airports NPS, with plans for Heathrow expansion.
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CAA says Gatwick proposal for a 2nd runway would not need airspace change, for the 50,000 extra flights on a 2nd runway
Gatwick airport has said will push ahead with plans for a 2nd runway after the Civil Aviation Authority (CAA) ruled that the plan for another runway will not require changes to the airspace around Gatwick. That had potentially threatened to pose a significant barrier. The CAA (paid for by the airlines) that is the regulator for the airlines, said that there would be no change to the design of flight paths in or out of Gatwick as a direct result of the new runway, adding: “The environmental impact relating to this proposal is assessed as nil.” [Presumably they are ignoring the carbon emissions which will not, of course, be nil]. Gatwick wants to have an extra 50,000 annual flights (up from around 285,000 now) by using its existing emergency runway as a full runway, part of the time. The airspace consent by the CAA effectively allows Gatwick to push ahead with a DCO (Development Consent Order), which is needed for the development, Currently the airport has been hit very hard by the Covid pandemic, with flights down by over 98% compared to last year, airlines facing almost no air travel demand, saying they may leave Gatwick, for Heathrow.
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Covid-19: Virgin Atlantic to cut 3,000 jobs and shut down Gatwick operations
Virgin Atlantic has announced it is to cut more than 3,000 jobs in the UK and end its operation at Gatwick airport, due to the collapse in air travel demand because of the Covid-19 pandemic. This comes soon after rival British Airways said it could not rule out closing its Gatwick operation. Virgin was Gatwick's 9th largest airline, while British Airways was the 2nd largest, after EasyJet, which is largest - Norwegian is 3rd largest. Virgin Atlantic said it will move its flying programme from Gatwick to Heathrow, but it intends to keep its slots at Gatwick "so it can return in line with customer demand". The job losses amount to about 30% of the total (the job losses at BA are 28%). Virgin Atlantic also plans to reduce the size of its aircraft fleet from 45 to 35 by the summer of 2022. Even the lobby group, Airlines UK admits that "Airlines are having to adapt to a sector that will be smaller and leaner in future, with no guarantees as to when we will return to pre-crisis levels." When lockdown restrictions ease and flight schedules are increased again, there will be fewer passengers, fewer and probably more expensive flights and thousands of job losses. The area around Gatwick was too dependent on the airport for jobs etc.
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Covid-19: UK Government ‘actively looking at’ quarantining UK airport arrivals
The UK Government is “actively looking at” quarantining, for Covid-19, people arriving from abroad - due to criticism about the UK dragging its feet on this, compared to other parts of the world. Currently, there are no health checks on passengers arriving into the UK. Many other countries have banned all but their own citizens and residents from incoming flights - while other nations have regional restrictions. There are reports the UK Government is considering forcing all arrivals to undergo two weeks of quarantine as they arrive in the country, to prevent the arrival of new Covid cases. Grant Shapps has said that we need to ensure the sacrifices, of lockdown and social distancing, that the Government has asked the British people to make are matched by anybody who comes to the country. The Scottish Health Secretary has said she thinks air passengers should have to quarantine themselves. Airlines, of courses, are not keen as they say a compulsory period fo quarantine would kill air travel. Lobby group, Airlines UK, said a quarantine would "completely shut off the UK from the rest of the world when other countries are opening up their economies" - ignoring the fact that most air travel (over 80%) is for leisure.
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Warren Buffett’s company Berkshire Hathaway sells all its shares in the 4 largest US airlines
Billionaire investor Warren Buffett has said his company, Berkshire Hathaway, has sold all its stakes in the 4 largest US airlines, because of the coronavirus crisis. According to the company's financial records, it had an 11% stake in Delta Air Lines, 10% of American Airlines Co, 10% of Southwest Airlines Co and 9% of United Airlines at the end of 2019. Speaking at the company's (virtual) AGM, the business tycoon said "the world has changed" for the aviation industry due to Covid. He said he had made the wrong decision in investing billions of dollars in the aviation industry, since 2016. He thinks it is unclear if as many people will fly in the coming years as in 2019. He said if airline demand comes back 70-80%, that means airlines will have too many planes. The company was one of the largest individual holders in the four airlines. Berkshire Hathaway has lost money on airlines, and is worth less today because of the decision to invest in airlines. Elsewhere, there is speculation that the aviation sector will have to invest more in environmental initiatives, and there will be a decline in investment in the construction of new airport terminals, new airports and new aircraft orders.
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Campaign groups write to Sec of State for Transport, asking for a far-reaching review of the aviation industry – with any bail-out funding conditional on proper review
In the current, unprecedented situation for aviation, created by the Covid-19 pandemic, the sector is lobbying hard to be given government bail-out money. Now campaign groups have written to Grant Shapps, asking that a far-reaching review of the aviation industry and the regulatory mechanisms through which it is overseen should be carried out urgently. This is necessary in the light of the series of failures, which have had very significant environmental, health and financial costs. The aviation industry is routinely excused from taking adequate responsibility for its adverse impacts on society and environment, while it enjoys immense legal, fiscal, public funding and other privileges. But its core low-margin high-volume business model - for which it now demands subsidies and bailouts - is unsustainable and no longer credible. The relationship between government and the industry has become too cosy, with policy-makers and officials appearing to believe and act as though their main role is to advance the industry’s interests rather than to regulate it effectively. The letter says systemic failure of the aviation industry, and its regulators is over-due. The intention to carry out such a review should be a condition of, and announced in parallel with, any “bail-out” of UK aviation businesses.
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Some possible changes to flying, when and if people want to start flying again
There is much speculation about what the aviation sector will be like in the later part of this year, and in the next few years, due to the Covid pandemic. It is very uncertain, not only whether - or how much - governments will bail out airlines, but also whether air travel demand will stay low, for years. It is likely unprofitable airlines will go out of business, and others will become smaller. They will probably abandon unprofitable routes and reduce capacity - which will mean air travel will be come more expensive. People are rightly very nervous about subjecting themselves to crowds of people at airports, and in planes - even if there is some measure of social distancing, and if wearing masks is compulsory. Enhanced cleaning regimens and modified boarding practices will raise operational costs. Will people over 50 or 60 be discouraged, for their health risk, from flying abroad? Will travel insurance become prohibitively expensive? Will some countries not want incomers, potentially bringing infection? Will the concept of a "bucket list" of travel destinations now be binned? Will travel again become something special, with a "holiday of a lifetime" becoming just that? Fewer short trips, with longer and more meaningful trips instead?