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Old 28th Nov 2020, 03:47
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OzzyOzBorn
 
Join Date: Oct 2017
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A very thoughtful response, Roverman. However, I would respectfully put it to you that neither MAG, nor any other airport operator, can significantly influence the inevitable trends implicit in the evolution of global air passenger travel. Low cost / no-frills is the inevitable future of short-haul, and airports which presume to stand against this tide will be washed away. Even Lufthansa Group has finally buckled and gone BOB. IAG were ahead of them on that one. Whether we welcome this new paradigm or not is immaterial. It simply is so. We might as well reminisce about the halcyon days of the stagecoach. Change happens. MAN in particular should stand acutely aware of this, having served as an industry case-study in the perils of customer selection when they refused to engage with no-frills carriers in the earliest days of that emergent sector. The result was that they catapulted nearby LPL from a 250K ppa minnow to a 5M ppa pain in the side in short order, and ended up firefighting for a decade to recover the ground they lost. And the gamble was an abject failure even viewed from the perspective of protecting legacy short-haul schedules. As Eastern Europe opened up from LPL, MAN lost carriers such as LOT, CSA, Air Baltic, Balkan, TAROM and Estonian Air like dominoes. The customers just shifted down the East Lancs Road. MAN didn't even have the no-frills replacements to show for it. Plus the elephant in the room: BA walked away anyway. It was arguably the single greatest strategic blunder in the history of the airport.

I have the greatest respect for your forum contributions - I know that you have long experience at a very high level of airport management - but I just cannot endorse a strategy which (again) prefers to marginalise the no-frills sector in favour of rapidly contracting legacy carriers which are themselves devolving into the price-led no-frills space at a rate of knots. Not only do I expect established no-frills carriers to be the strongest market participants as we emerge from Covid, but I would also anticipate that the most likely new homes for relatively young parked-up white tail B737's/A320's will be new-entrant no-frills players joining the market with no legacy debts, bargain lease deals and a ready supply of highly-trained labour in a recruiters' dream market. Even long-haul will be forced to gravitate more towards the budget sector than full service (which favours MAN's core customer base if played smartly). And keep in mind that even the established prestige long-haul names routinely carry far more passengers in the cheap seats already, a trend which we can only expect to accelerate.

On the idea of becoming a single runway / single terminal operation for a decade to come, I must again take an opposing view. Firstly, as discussed in my earlier posting, I expect short-haul no-frills to be the prominent resurgent sector of the market. MAN is - and needs to be - at the forefront of this (RYR and EZY are already two of the largest based operators). Jet2 and TUI, whilst offering a more value-added customer proposition, are overwhelmingly leisure-orientated too. MAG would have to be delusional to presume that IAG, Lufthansa Group, Air France / KLM and the like are (in isolation) the key to a prosperous future. And that's if we overlook that their onboard experience is barely distinguishable from the no-frills players already. These groups will need to face off against the Ryanairs and the Wizzairs or fade away. MAN needs to embrace this sector - imperfect as it is - or be left to spectate from the sidelines as competing airports grow around them. The early 2000's revisited - but on steroids.

On the environmental impact issue ... a subject which I don't wish to introduce in depth for the purposes of this discussion ... keep in mind that carriers conveying 195 (B738) or 220 (A321) seats per rotation with consistently high load factors serve the cause of clean air far more efficiently than a high fare generously configured aircraft operating with a 50% load factor. No frills carriers aren't a bad thing. And it is up to the industry as a whole - not an airport group of modest size - to drive the agenda towards industry-wide green propulsion technology. Until that arrives, the best thing we can do in the meantime is to ensure that air seats don't fly empty. The no-frills model is the best gateway to delivering this outcome.

I would suggest a further issue with aspiring to a single-runway operation - quite aside from the obvious. If you have a highly valuable strategic infrastructure asset ready and available why ever would you mothball it at the cost of rejecting incremental business which would profoundly benefit the region? I note your view that services such as those to Eastern European cities are of low value to the economy, but I must again respectfully disagree. These regions have entered a cycle of substantial growth in economic importance, and I contend that it is a good thing that the NW has established rapidly growing expat communities from these countries which will expand cultural links far into the future. And don't be too quick to dismiss no-frills customers as being of economically low value to the region. I recall reading an account of a group of conference delegates exchanging tales of how cheap their air travel to the selected resort complex had been: many had used no-frills carriers and discussed this as a badge of honour. Every one of them had a net worth of multiple millions. We cannot pigeonhole customers by the airline they fly with. Taking even myself as an example, pre-covid I flew Tiger Air (Australia), Singapore Airlines long-haul and Ryanair short-haul just days apart. Judge me how you will - I'm the same person on all of these journeys and my economic value to the airport concessions was broadly similar on each occasion.

Continuing on the theme of single runway / single terminal. The serendipitous good fortune of having one terminal which given modest investment in a refresh will be the very epitome of the ideal no-frills short-haul facility, and another which is a state-of-the-art full service facility with all the trimmings, offers a stunning opportunity which MAN must not waste. An opportunity to embrace both sides of the mainstream air passenger market whilst maintaining a clear distinction between them. Many large airports would dream of such good fortune. And do note that the days of Ryanair and Wizz hiding away at unknown former military airbases located in the sticks are rapidly fading into memory ... carriers such as these are bagging slots at many of the highest profile gateway airports now. MAN could attempt to sidestep this trend, but the industry wouldn't stop for them if they did ... though I speak theoretically, as RYR and EZY are established in size at MAN already. Any attempt to cap their further growth in an environment where Thomas Cook and FlyBe haven't been backfilled (even before accounting for C-19 wounds) would be reprehensible in my view. A new level of negligent arrogance.

One further point on your single runway proposal. I would suggest that the return of air transport movements and passenger volumes will not necessarily transpire in lockstep. At first glance this sounds illogical, but it really isn't. We're seeing early examples of this trend playing out already. HOP! Embraer 170's/190's replacing Air France A321 rotations; KLM Embraer 175's/190's replacing Boeing 737-800's/900's; Lufthansa Regional CRJ900's and Embraer 190's replacing A320/A321's. On long-haul, Qatar B787-8's replace A350-900's; Emirates B777's replace A380's. And at the extremes, Eastern Jetstream 41's have replaced FlyBe Embraer 195's on MAN-NQY. In fact, several former FlyBe routes are defaulting to smaller types. We mustn't disregard the upsurge in executive movements too. This trend in motion sees demand for runway slots coming back much more quickly than passenger numbers. MAN must not look the other way and pretend that this isn't happening. The network carriers will want to protect frequencies and the hub connections they open up; MAN must accommodate this. It would be quite negligent for MAN to close a hard-won full-length runway to wilfully thwart the needs of its airline customers. Where is the upside in wasting arguably the North's primary strategic transport infrastructure enhancement of the last half-century? What kind of message does it send to Whitehall if we can't be bothered to use the world-class infrastructure we actually have? Please no ... don't even think about it.

So whilst I agree with you that the tragedy of C-19 has delivered an unforeseen chance to reorganise the Manchester Airport estate to best prosper from new opportunities offered by the post-virus paradigm, I must very respectfully hope for a quite different outcome than the one which you advocate. But I still hold your contributions to the forum in the highest regard. Your relative absence of late has been noticed; please do post your insights more frequently once again.
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