the case for increasing london`s air capacity

FLIGHT PATH
TO GROWTH
THE CASE FOR INCREASING
LONDON’S AIR CAPACITY
THE PROBLEM
WHY DO WE NEED TO FLY?
The UK is the world’s second-largest exporter
of services and the sixth-largest exporter
of goods.
Our current trade patterns are dominated
by traditional partners in the United States
of America and European Union but global
economic growth is increasingly being driven
by emerging markets in countries such as
China, India, Indonesia, Mexico and Brazil.
There is a clear correlation between volumes
of trade and air travel – the number of
business passengers at UK airports rises
in line with total trade volume with the UK.
Growth of UK trade and business passengers
at UK airports: 2000–2009
Total UK trade
Business passengers
30%
10%
Percentage
Demand for business flights is forecast to
grow by 80% to 2030. The UK must ensure
it is open for business and ready to fly.
WHAT’S THE PROBLEM?
More than 200 million passengers pass
through the UK’s airports each year, a
fourfold increase in the last 20 years. While
the recession has dampened demand, growth
is returning – in 2011, passenger numbers rose
by 4 per cent at Heathrow and 3 per cent
at Gatwick. The Department for Transport
forecasts that all major airports in the South
East will be full by 2030.
Heathrow is full now, running at 99% of its
current permitted limit of 480,000 air traffic
movements (ATMs) a year. While there is
spare capacity at London’s point-to-point
airports, and Gatwick in particular has been
successful at attracting new flights from
Jakarta, Lagos and Seoul, they are forecast
to be full in approximately the next 15 years.
20%
0%
-10%
-20%
-30%
While the UK already has excellent air links
to established economies such as New
York, Paris and Frankfurt, in order to remain
competitive, we must also expand our existing
air routes to include direct links to emerging
economies in South America and Asia.
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Financial year by quarter
1968
Roskill Commission
Source: ONS
1974
Maplin Scheme abandoned
1974
Study for Hong Kong airport
Charles de Gaulle airport opens
with two pairs of parallel runways
A timeline: 40 years of indecision about London while our rivals have expanded
1979
Gatwick second runway ruled out
1985
Aviation Policy
White Paper
1984
Frankfurt opens
third runway
1
Proportions of air passengers suppressed
from travel by district, 2040, (central demand)
Source: DfT’s passenger allocation model
Suppressed Demand
0.00 to 0.10%
0.10 to 0.25%
0.25 to 0.50%
0.50 to 1.00%
1990
RUCATSE study set up
1990s
Marinair proposal
1991
Construction begins on
Hong Kong airport
1995
RUCATSE rejected
1999
South East
Regional Air
1997
service (SERAS)
Fourth runway set up
construction
started at
2000
Frankfurt
The Future
airport
of Aviation
Hong Kong
airport opens
document
1.00 to 1.50%
1.50 to 2.00%
2.00 to 2.50%
2.50 to 3.00%
2002
Marinair
rejected
2003
Cliffe proposal
abandoned
The Future of
Air Transport
White paper
3.00 to 3.50%
3.50%+
2004
Madrid
Barajas
opens third
and fourth
runway
2008
Shivering
Sands
proposal
2003
New runway
opened at
Schiphol
Moscow
Domodedovo
expansion
announced
2
So, London is already at a competitive
disadvantage. It has fewer weekly flights than
its European rivals to half of the emerging
market economies, and seven of the
eight growth economies identified by the
International Monetary Fund.
Passengers passing through UK airports
each year (millions): 1980–2010
London’s European rivals have risen to the
challenge of adding capacity. Frankfurt
Airport and Paris Charles de Gaulle Airport
have four runways each while Amsterdam
Schiphol Airport has six.
UK
London
260
240
220
Number of passengers (millions)
Frankfurt and Paris alone boast over 2,200
more flights every year to mainland China than
Heathrow, while there are 26 emerging market
destinations with daily flights from other
European hubs that are not served daily
from Heathrow, including Manila, Lima,
and Chennai.
Since 1992, Heathrow’s capacity has grown
53 per cent, while Frankfurt Airport has grown
84 per cent, Paris Charles de Gaulle 142 per
cent and Amsterdam Schiphol 160 per cent.
200
180
160
140
120
Our lack of capacity threatens to hamper
London’s success as a global business
centre and its ability to spearhead the
UK’s economic recovery.
100
80
60
40
20
1980
1985
1990
1995
2000
Years
2005
2010
Source: CAA
40 years of indecision (timeline below)
In 1968, the Roskill Commission was set up to find a
site for a new 4 runway airport for London. Its eventual
recommendation was Maplin Sands in Essex, but despite
the Maplin Development Act receiving Royal Assent in
October 1973, the scheme was abandoned in 1974.
Since then has followed 40 years of indecision about how
best to expand London’s aviation capacity, including rejected
studies on Runway Capacity to serve the South East
(RUCATSE) and the Marinair proposal for a new hub airport
in the Thames Estuary.
2009
Labour support for third runway
2010
Coalition rules
out expansion
2011
Lord Foster
scheme Nov
2011
Frankfurt fourth
runway opens
2015
Airports Commission
Report due
Shanghai – third terminal 2019
Gatwick can apply
and two additional
for 2nd runway
runways planned
2029
All London’s
airports
forecast to
be full
2030
Hong Kong
masterplan –
three-runway
system by 2030
2012
Airports Commission
set-up
3
THE SOLUTIONS
SHORT TERM OPTIONS
WHAT HAPPENS NEXT?
• H
eathrow airport could have greater
flexibility to use its runways more intensively.
Over time, “mixed mode” operations could
increase runway capacity by up to 10 per
cent, providing both the opportunity for
headroom to cut delays and more ATMs.
Additional flights could be accompanied by
stringent noise control measures, enforced
by independent regulator to build trust.
The Government has appointed an
independent Commission to identify and
recommend options for maintaining the UK’s
status as an international hub for aviation.
• G
reater competition in the London market
could spur the use of capacity at point-topoint airports. Removing cumbersome price
cap regulation from Gatwick and Stansted
would give them greater flexibility to
compete, providing a greater choice of
services to passengers and airlines.
The Commission will provide an interim report
by the end of 2013 recommending ways to
improve use of existing runway capacity in the
next five years. By the summer of 2015, it will
publish its final recommendations for meeting
the UK’s long-term needs
WHAT CRITERIA SHOULD THE
AIRPORTS COMMISSION APPLY?
MEDIUM TERM OPTIONS
• Does any proposed option for additional
capacity secure London’s links with world
markets? This should be a deciding factor in
assessing all options.
• L
ondon needs new runway capacity as
a matter of urgency to meet demand and
cater for growth. A third runway at Heathrow
could be delivered within 15 years and
support a 50 per cent increase in flights.
• Can a proposed option deliver an increase
in international flights quickly, ahead of any
new runways?
• F
urther capacity in the form of another
runway at one of London’s existing point-topoint airports – Gatwick or Stansted, would
meet even the most stretching forecasts for
demand to 2050, within the UK’s carbon
reduction commitments.
• A
new hub airport, with at least four
runways, offers the prospect of state-ofthe-art infrastructure in a location with
world-class transport links. A number
of sites have been proposed along the
Thames Estuary; expanding Stansted has
also been mooted. A new airport could be
linked by high speed rail to London and,
possibly, other destinations and integrated
into the roads network by new roads.
• When can new runways be delivered and
what impact will their timing have on
international airlines’ view of the UK as a
location before, during, and after?
• Can any required public sector funding
be guaranteed across parliaments and
economic cycles?
• What investment in surface access will
be required? What are the risks involved?
• What weighting should be applied to
the numerous social, environmental and
economic factors, so that negative impact
is appropriately measured against benefits?
• What mechanisms, such as independent
noise regulation, can be put in place to
enforce limits on these negative impacts?
4
Distribution of air passenger demand 2010 & 2040 unconstrained
WHAT IS LONDON FIRST’S VIEW?
Source: DfT’s passenger allocation model
Passenger Demand
0-50,000
50,000-100,000
100,000-200,000
200,000-300,000
300,000-400,000
400,000-500,000
2010
2040
500,000-750,000
750,000-1,000,000
1,000,000-1,500,000
1,500,000+
Action to overturn London and the UK’s
competitive disadvantage is needed now.
The Airports Commission must offer short-term
proposals for increasing long-haul flights serving
London that can immediately be set in motion. In
our view, the current cap on ATMs at Heathrow
should be lifted with mixed mode runway use
and credible measures to alleviate the effect
of increased noise;, while at the same time
Gatwick and Stansted should be deregulated
to spur greater competition.
In the longer term, London needs additional
runways, to provide both capacity and further
competition, as quickly as possible. All options
have their strengths and weaknesses. Given
the considerable planning challenges and
public funding that would be required to provide
surface links and compensate for the closure of
Heathrow if a new airport were to be built, our
analysis is that a third runway at Heathrow and
a second runway at Gatwick are the most
practicable means of meeting this objective.
GLOSSARY
What is a hub airport?
A hub airport is used by an airline as
a transfer point to get passengers to
their eventual destination. Heathrow
is the UK’s international hub airport.
What is mixed mode?
Often, multi-runway airports will use
separate runways for landing or takeoffs. Mixed mode allows dual use of
runways for both landing and take-off.
Transfer passengers may be pooled
with point-to-point passengers at a hub
airport to sustain flights that may not
otherwise be viable, reducing costs
for passengers. The benefit of having
an international hub airport is that it
provides a high frequency of flights on
key routes, enabling Londoners to fly
direct to a wide range of destinations
without having to change planes.
Mixed mode can offer both greater
headroom to cut delays and an
increase in flights. In either case,
changing flight patterns can change
the distribution of noise experienced
by local residents.
Contact us London First, 3 Whitcomb Street, London WC2H 7HA
T +44 (0)20 7665 1500 E [email protected] www.londonfirst.co.uk
What is a ‘slot’?
Take-off and landing slots are rights
allocated to airlines by an airport or
government agency. They allow the
owner to schedule flight arrivals and
departures during a specific time
period, and to choose the destination.
Peak slots - early morning arrivals
and midday departures - are in
huge demand.
Design David Carroll & Co
What is a point-to-point airport?
A point-to-point airport from where
airlines fly directly to a destination,
rather than going through a central hub
e.g. Gatwick Airport, Stansted Airport,
Luton Airport, City Airport.
What is an air traffic
movement (ATM)?
One total movement is a landing or
take-off of an aircraft.
April 2013
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