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HEATHROW

Old 17th Sep 2016, 17:31
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Originally Posted by Dobbo_Dobbo
Like state aid.
What?? State aid?! Tosh.
Have a look here for what state aid actually is State Aid in the EC

Heathrow's scheme is privately financed.

Last edited by Trash 'n' Navs; 17th Sep 2016 at 17:35. Reason: fixed the link
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Old 17th Sep 2016, 17:37
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Originally Posted by Trash 'n' Navs
What?? State aid?! Tosh.
Have a look here for what state aid actually is State Aid in the EC

Heathrow's scheme is privately financed.
A bald assertion. Nice try.
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Old 17th Sep 2016, 17:51
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I am also not going to mention the ME3 of which MAN is so dependent. Whoops!
The last set of figures released by MAN indicate approx 24.6 million passengers a year. In 2015, the ME3 had approximately 1.6 million passengers. So exactly HOW dependent is MAN on the ME3? They've not stopped HU, CX and NL introducing services and PK bolstering theirs.
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Old 17th Sep 2016, 18:37
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Originally Posted by Dobbo_Dobbo
A bald assertion. Nice try.
Then tell me which page of the AC Report says the Heathrow expansion is being funded by the state. I missed it.
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Old 17th Sep 2016, 19:20
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P328

Fig 16.33 refers "nature and scale of financing ".

Airport Commission Final Report.

Incidentally if there is no public contribution can you confirm exactly what the chief of the treasury select committee is actually querying?

We would all love to know.

He has written to Chris Grayling 5 times asking for answers?

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Old 17th Sep 2016, 19:27
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Originally Posted by Trash 'n' Navs
Then tell me which page of the AC Report says the Heathrow expansion is being funded by the state. I missed it.
As a supporter of LHR expansion, it's your case to prove.
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Old 17th Sep 2016, 20:34
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Then tell me which page of the AC Report says the Heathrow expansion is being funded by the state. I missed it.
Compulsory purchases will be born on the public purse.

Removals of utilities and roads on the public purse

Modifications to the surrounding roads and rail on the public purse.

Imported materials and expenses underwritten by the state.

This is several billions of PUBLIC money.

As others have said the R3 case does not pass the value for money test imo.

Ands i couldn't care less that people in the regions are changing to route through other hubs on the continent, in the desert or even actually using the increasing number of point to point options, because the disruptive forces at play with flexible fares and yes those ME3 +1 one options are changing the playing field with or without R3.
This is simple completion at work and if one rather well known LHR operator chooses to continue to offer little (nothing) from much of the regions combined with additional stops! on many global routes its their commercial decision isn't it ?

BTW the predicted and expected growth in aviation the next 40 years is within Asia and continued short haul not those lovely long hauls from London or others.

The developing economies aren't proving that reliable in generating global growth - They by definition aren't stable

I struggle to believe that a single UK airport runway space or not would reach 140 million .

Further i read many times that somewhere like Heathrow requires the Hub and Spoke model to support the thinner routes.

Well if a route is so precarious chop it imo - they do in the regions !
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Old 17th Sep 2016, 21:24
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Wow, I do hope they reopen the Manchester thread for you guys.

Page 328 doesn't say State Aid is being provided. On the contrary it says the airport should pay a significant part "if not all" of the surface access costs directly associated with expansion.

Check the link I provided because State Aid doesn't apply here.

Oh, compulsory purchase is funded by the developer.
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Old 17th Sep 2016, 21:55
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Trash you do know i live less than 8 miles north of Heathrow

Compulsory purchase orders are indeed born by the State with defined compensation rates they are not funded by the developer.
The developer then acquires the land from the authority at what ever rates can be agreed.
So the public purse has the hit up front.

I have no doubt that there will be contracts placed to recover as much of the public costs of off HAL over time, however like it or not huge oceans of PUBLIC tax payers monies spent WILL accrue on this project and the bill will without doubt take thirty + years to recover.

The current voluntary system being offered is very generous through at 25% above commercial rates and any one in the effected area would be idiotic not to take advantage now but thats rather a different debate.

As for those projected employment gains again somewhat sceptical on several grounds not the least as where to house them if they ever materialise.

It further adds to local pressures on public services and continues the migration South .

Personally would rather see fewer jobs created however focused in the regions where levels of unemployment remain high wouldn't you ?
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Old 17th Sep 2016, 22:59
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Originally Posted by Trash 'n' Navs
Wow, I do hope they reopen the Manchester thread for you guys.

Page 328 doesn't say State Aid is being provided. On the contrary it says the airport should pay a significant part "if not all" of the surface access costs directly associated with expansion.

Check the link I provided because State Aid doesn't apply here.

Oh, compulsory purchase is funded by the developer.
Of course the report doesn't say state aid is being provided!!!

Firstly, it's not Heathrow's document setting out Heathrow's proposal and secondly, why would Heathrow admit to this when they are clearly trying to present this as a fait accompli with the taxpayer picking up a significant (tens of billions) part of the bill.
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Old 18th Sep 2016, 05:11
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It is Gatwick's view that the commission has got it completely wrong with regard to pax numbers and new routes. The commission stated it would take Lgw another 10 years to reach 40m pax p.a. yet they are already past that figure. The commission also stated it would take Lgw until 2050 to get to 50 long haul routes, a number now exceeded. Is Lgw correct in its claims? If they are, how are we then take this report as being completely accurate with such serious errors and use it to decide future policy for the country?
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Old 18th Sep 2016, 09:22
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Compulsory purchase - Heathrow is offering 25% above market rate and has a large allocation set aside in its costings. Should a commercial agreement not be achieved then yes, the state can compulsorily acquire it but would pass the cost straight on to the developer. This is what page 328 says.

AC forecasts - if the AC's methodology is flawed and they didn't predict LGW's growth, then the same must be true of LHR's growth. In which case, it's worse than first thought. The government is artificially influencing the market by preventing LHR from expanding and driving growth to LGW as there's no alternative. That sounds like State Aid in favour of GIP.
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Old 18th Sep 2016, 09:41
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Originally Posted by Trash 'n' Navs
Compulsory purchase - Heathrow is offering 25% above market rate and has a large allocation set aside in its costings. Should a commercial agreement not be achieved then yes, the state can compulsorily acquire it but would pass the cost straight on to the developer. This is what page 328 says.

AC forecasts - if the AC's methodology is flawed and they didn't predict LGW's growth, then the same must be true of LHR's growth. In which case, it's worse than first thought. The government is artificially influencing the market by preventing LHR from expanding and driving growth to LGW as there's no alternative. That sounds like State Aid in favour of GIP.
Thats a pretty fundamental misunderstanding of commercial reality, let alone state aid.

If LHR are unable to expand (for example because they cannot afford to do so without significant support from public funds) then that is a commercial issue for LHR to address.

State aid is not a zero sum game. If LHR is allowed to grow, then that does not necessarily mean that it receives state aid. Likewise if LGW is allowed to grow. The issue is whether tens of billions of pounds of public money are being pumped into a private enterprise to give it an artificial competetive advantage over (in particular) AMS, FRA, CDG.
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Old 18th Sep 2016, 09:52
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Does the CPO cover the cost of moving the waste to energy site to some other venue, or the BT data centre. Also the infrastructure of the A4 Bath Road.
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Old 18th Sep 2016, 10:21
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Heathrow is not a straightforward peice of private enterprise anymore than Hinckley Point is. There are obvious grey areas where HMG needs to support a business which is fudamental to national infrastructure and arguably should not have been sold off entirely in the way it was.
Gatwick are screaming "unfair" because the venture capitalists who bought it for a very good price need LHR to be constrained to flog it off for a much higher one so those at GIP can add to their yacht collection. By all means allow LGW to expand but not at the cost of the airport that airlines and customers would prefer and the one which supports the economy wayyyy more.


LGW does not have "50 long haul routes" without counting all those once a week TCX and TOM beach destinations. For purposes of business long haul they have :
HKG CX A359 not daily vs 5 B777s daily LHR
JFK BA B772 loss leader vs DY
DXB A388 high Y capacity with no F on many services

The rest is p2p leisure with almost no capacity for inbound investment.
The one recent change is DY and two based B787s but that's little acorns at the mo but is beginning to drive inbound US pax. No other major long hauler even uses LGW.

In the last decade, LGW has LOST : AA, DL, US, NW, CO, KE, CA, EY and QR !! No other airport comes close to losing so many major world airlines!
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Old 18th Sep 2016, 11:13
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Compulsory purchase - Heathrow is offering 25% above market rate
Again this is a voluntary buy out scheme available today by HAL - It's not a CPO .

Only defined State agencies , regional development boards and utilities can apply for a CPO via an Act of Parliament or via an order under the terms of the Transport and Works Act 1992,

If and when a CPO is issued the compensation rates are set in law and it is criminal offence to receive monies such to make a profit.

All expenses require documentation and detailed explanation including relocation costs legal costs other professional fees etc....

As I said those thinking that they are sitting pretty at the moment Will/WOULD be sorely disappointed and very financially embarrassed !
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Old 18th Sep 2016, 11:18
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LGW does not have "50 long haul routes" without counting all those once a week TCX and TOM beach destinations. For purposes of business long haul they have :
But Skip, you're missing the point here. TOM B788's and TCX A332's need to land on concrete runways just as CPA B77W's and BAW A388's do. This debate is about providing sufficient runway capacity to accommodate all flights serving London, regardless of whether we categorise the passengers onboard as business or leisure-orientated. LGW is absolutely fine for absorbing new leisure and no-frills traffic which is by far the largest growth sector. EasyJet, Norwegian, Ryanair, Vueling, Jet2, Wizz ... these are the carriers mopping up spare runway slots in the SE. Long-hauls on new thin prestige business routes generally require one slot-pair per day, maybe less.

By all means allow LGW to expand but not at the cost of the airport that airlines and customers would prefer and the one which supports the economy wayyyy more.
You are once again wilfully ignoring the financial cost involved here. GBP12-18Bn in public funds for support works in the vicinity of LHR, plus the risk of underwriting the privately-funded multiple-billions doesn't support the economy. It drains resources from it to a devastating extent in the way misallocated capital expenditure is prone to do. The sums involved are ruinous. They risk holing the economy, not supporting it.

LGW can provide the capacity needed to accommodate inherent SE demand-growth for air travel with considerably reduced risk to the public purse.
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Old 18th Sep 2016, 11:18
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Originally Posted by Skipness One Echo
Heathrow is not a straightforward peice of private enterprise anymore than Hinckley Point is. There are obvious grey areas where HMG needs to support a business which is fudamental to national infrastructure and arguably should not have been sold off entirely in the way it was.
I agree, and the present argument is the case in point.

However, we are where we are and in any case the idea that it should be Heathrow at any cost is plainly not a winner. Increasing supply whilst raising prices is not likely to end well without public support.

It's a shame the pent up demand is not common knowledge, that would make it much easier to assess.
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Old 18th Sep 2016, 11:35
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LGW is absolutely fine for absorbing new leisure and no-frills traffic which is by far the largest growth sector.
Nail and head as usual Shed.

Well said.

The debate is indeed about concrete and not the support of a particular business model which sees millions travel through London (CDG FRA and AMS similarly) to elsewhere adding little benefit the local economies - Don't even pay APD !

As said earlier the expected growth in air travel is within Asia and short haul not significant long haul over the next 40 years.

Its interesting isn't it that the only significant airline to have vocalised interest in LHR third runway is none other than a short haul flexible fare carrier rather orange in colour rather than some exotic from Mongolia or Sub-Saharan Africa !
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Old 18th Sep 2016, 12:11
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The debate is being held here rather than where it should be, ie Parliament

With such spectacular growth at both airport's then both projects should go ahead.

I am concerned that the Lhr project is going to cause major infrastructure problems to the M4/M25 network and thus airport access whilst its construction goes ahead. Can the airport cope with years of this potential chaos.
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