I was not implying Heathrow is DEPENDENT on Stansted. Clearly that is not the case! I was basically saying that Stansted's profits help out towards Heathrow's investments.
sponge off Stansted for finance
Again, of course not entirely, but it's extraordinarily unlikely that Stansted's profits have not been used to help pay for Heathrow's investments.
Stansted's pre-tax profits in 2011 amounted to £86.6 million and are estimated to be £94.2 million in 2012.
Stansted to be sold to Manchester Airports for £1.5bn - Business News - Business - The Independent (last sentence)
Let me clear some things up:
- If Stansted's profit outlook looks positive, then why would BAA be needing to cross subsidise Stansted from Heathrow? Especially since it's Heathrow getting all the major investments.
- Why else would BAA put up such as hard fight for 3 whole years to keep an airport that continued to decline under their management. The only other explanation is to purely retain profit. In that instance it would imply STN is too much of an asset to lose so that totally rules of the theory that it needs LHR to subsidise it.
- If Stansted is a "white elephant terminal", then why did it's sale attract so much attention and why did MAG pay £1.5 billion for it?
I can't work out the conclusion that LHR pays for STN. If this were true, why on God's Earth would they spend 3 years fighting for STN if it couldn't even stand in its own 2 feet? They'd instead gladly get rid of it! And if STN is in sustained decline and a "white elephant", then they would also gladly get rid.
The only logical explanation is that the profits from STN were used to pay for LHR's investments, because let's face it, STN hasn't had and more to the point doesn't need nearly as much investment.
Due to reccession, spending gets tough so they double STN's charges purely to increase profit rather than promote growth and funding for LHR's extensive investments starts eating into STN's profits.
Now that BAA (or Heathrow Holdings Ltd.) can no longer do this, they suddenly want to increase Heathrow's charges. How odd!