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Old 3rd Oct 2015, 10:49
  #481 (permalink)  
 
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And as for it being a small amount Shed
I have never stated that GBP1Bn is a small amount. It is a large sum. But I did say that it is not an unmanageable sum for a business the size of MAG structured over a 10-year build programme.

I know the questions I would be asking if I was asked for £1bn
Me too. But do you - as a self-professed lifelong banker - believe that MAG executives are off to the bank to request a one-off big-hit loan for a ten year modular construction programme? We both know that is not how high-level corporate finance works. Besides, MAG covers many of its costs from income.

Shed, I remind you that Greater Manchester councils have an interest of around 33% in MAG if I remember rightly. I'm sure they wouldn't think of it as a small amount
I'm sure they don't and as I stated earlier, neither do I. But they do regard the terminals redevelopment programme as a very worthwhile and fully-justified capital investment. Perhaps you would prefer them to argue for stagnation and decline? By the way, the ownership split is Manchester City Council 35.5%; Other nine GM Councils 29%; IFM Investors 35.5%.

Surely as an entity with such a significant local ownership/interest, the projections of income streams should be in the public domain?
The Councils are amply represented on the MAG Board. They are very well-informed concerning MAG finances. Given that they receive substantial annual dividends from MAG they're very happy with those finances too. And MAG does declare its finances / profits publicly by way of an annual report.

It appears to me that you have an agenda to discredit Manchester Airport and look for ways for it to fail. But MAG is in safe hands, and their expansion programme is carefully evaluated and costed. Everything is under control.
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Old 3rd Oct 2015, 11:06
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another point MAG pays quite a nice amount into the councils coffers

Ian
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Old 3rd Oct 2015, 11:20
  #483 (permalink)  
 
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Eyes,

You mention Heathrow as an example of fees, but, seem to almost deliberately ignore my STN example, which, is surely more relevant given its now a MAG airport and therefore a better example of how they may wish to operate?

Since MAG has taken on STN, Ryanair have increased flights and passenger numbers by a large degree, even to the point STN may once again overtake MAN as 3rd busiest airport.

They have also gained at least 2 new cargo operators, new airlines and more flights. Does that give the image of increased fees which may put off carriers?

I'm not entirely au fait with exactly how MAN will pay for the terminal re-development, but, given you seem to be focusing on fees in particular, these are the best answers that can be given.
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Old 3rd Oct 2015, 11:22
  #484 (permalink)  
 
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MAG

Shed I share the LN KGL philosophy, which is one of caution. I remember him looking at the North West airports as a whole to understand the underlying growth.

If you compare 2014 to 2004, then across the three airports (now two), total passengers have increased from 24.86m to 26.20m. That's growth of 5.39% over 10 years (source CAA).

I'm sure we can point to various impacts such as the Recession etc - but the saying is that the past predicts the future. If that growth is replicated in the future, then will it be sufficient to repay the additional liability? If not, what is the fallback position?Local councils are increasingly cash strapped and they will be relying on the MAG dividend continuing.

These are sensible questions to ask and I re iterate, I'm surprised that the answers are not in the public domain given that the Heathrow equivalents are.

In case you accuse me of bias, you will find that I have also supported the recent drop off charge al Liverpool which may not be popular, but recognises the reality of the situation. Oh and my brother has worked at MAN for many years and I wish that to continue!
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Old 3rd Oct 2015, 11:41
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will it be sufficient to repay the additional liability? If not, what is the fallback position?
The modular mode of construction means that MAN can adjust the rate of redevelopment if necessary. They have a ten year construction window in which to monitor evolving traffic trends in real time. Meanwhile, we already know that the initial phases are desperately required based on current demand alone. Don't forget - the alternative of keeping the existing ageing terminals complex fully operational would come with its own high price-tag.

I'm surprised that the answers are not in the public domain
MAG's financing proposals are known to the Board (ie. the owners). There is no reason for such information to be shared publicly on a blow-by-blow basis with unrelated parties in the interim. MAG has a website dedicated to the rebuild programme and information already made public will be updated there as the project progresses.
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Old 3rd Oct 2015, 12:39
  #486 (permalink)  
 
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MAG

A modular approach is sensible, given a few rather worrying straws in the wind e.g. Redcar Steel closure, JCB looking to close 4 plants. I still hold that it's a rather more public issue than say Peel given the ownership, but we can agree to differ on that one.

Incidentally, I found your posting re Ryanair above to be on the mark with regards to the change in business model.
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Old 3rd Oct 2015, 12:48
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isn't this the Liverpool thread?
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Old 3rd Oct 2015, 12:58
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Well said, rkenyon...

Whilst it is frustrating that Liverpool seems to be a 'sandpit' for new Ryanair routes from the north west, they are at least maintaining volume through Liverpool and increasing load factor all the time. The more they focus on core bucket and spade routes, the greater the scope for the airport's management team to make a case to other carriers that there are market opportunities to be exploited out of Liverpool. And let's face it, over the last 12 months they have been pretty good at that.

Shed; whilst I agree to a degree on your post in terms of taking the bigger picture, remember that it cuts both ways and clearly not every carrier thinks that Manchester is the only place to be successful in the north west. Anything else quite frankly comes across as patronising, even if not intended in that way. Also, whilst airlines might not directly pay the cost of Manchester's new facilities, you can be sure their passengers will...

Last edited by AndyH52; 3rd Oct 2015 at 13:20. Reason: additional opinion; typos
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Old 3rd Oct 2015, 13:13
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Liverpool

Rebuke accepted, fellas! An interesting discussion, nevertheless and one which has impacts on both airports.
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Old 3rd Oct 2015, 19:16
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Ryanair

To get back on track, Ryanair have released twice weekly flights to Reus, beginning in June. That takes their weekly flights back to the same level of 2015, with the exception of August.
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Old 3rd Oct 2015, 19:58
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AndyH52 -

clearly not every carrier thinks that Manchester is the only place to be successful in the north west
And where did I suggest this? I specifically mentioned LPL's success in attracting new names to the departure boards over recent months. It is counter-intuitive to draw your conclusion from that.

Anything else quite frankly comes across as patronising, even if not intended in that way.
The posting addressed the topic of airline strategies in general; it was not specific to LPL. If the process by which RYR is transferring aircraft to larger airports comes across as patronising, I presume that applies to Bergamo, Girona, Reus, Charleroi and Prestwick as well? The only way posting this information could be less patronising would be to not report on the situation at all. I deliberately conveyed the information in a matter-of-fact and non-confrontational way, and I stand by the principle that it is better to be well-informed even if one dislikes the underlying facts.

Also, whilst airlines might not directly pay the cost of Manchester's new facilities, you can be sure their passengers will...
If you have received a personal briefing on MAN's future regime of passenger charges please do enlighten us ...

eye2eye5: Thankyou for your earlier comments. Interesting discussion.
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Old 6th Oct 2015, 14:54
  #492 (permalink)  
 
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SHED. Sorry for the delay in responding...I've been away on business.

And where did I suggest this?
I don't know, where did I suggest that you did? My point (probably badly made) is that just perhaps, Blue Air, Wizz Air and Czech are at Liverpool because they have decided it is the best option for them to serve the North West market, not because MAG decided 'not to pitch for them' - and before you respond, I acknowledge that these are my words not yours!

The posting addressed the topic of airline strategies in general; it was not specific to LPL
The posting is in the Liverpool thread and mentions Liverpool a dozen times. It's a fair assumption to make.

If the process by which RYR is transferring aircraft to larger airports comes across as patronising, I presume that applies to Bergamo, Girona, Reus, Charleroi and Prestwick as well?
Yes, as your premise is flawed. The airports you list and the process being followed in general by Ryanair in these locations is one of shifting from secondary to primary airports which serve the same urban centre. Unless you are suggesting that Liverpool is in effect 'Manchester West' then the situation is quite different.

If you have received a personal briefing on MAN's future regime of passenger charges please do enlighten us ...
I believe it is reasonable to infer that if airline charges aren't going to rise to pay for the investment then the increased revenue needed will come from the other main cash cow, the passenger.

Finally I would ask you to bear in mind that a number of the contributors on this thread rely on the airport for their livelihoods, so telling them 'not to take things personally' could also be perceived as patronising.
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Old 6th Oct 2015, 18:02
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Reply to AndyH52

Wizz / Blue Air / Czech are ...

at Liverpool because they have decided it is the best option for them to serve the North West market
Yes, as your premise is flawed. The airports you list and the process being followed in general by Ryanair in these locations is one of shifting from secondary to primary airports which serve the same urban centre.
Now, just re-read your two statements quoted above. When you refer to Blue Air, Wizz and Czech the catchment area is deemed to be "the North West Market". But if the name in the frame is Ryanair that same premise is flawed ... according to you.

From an airline perspective, the name on the airport door is irrelevant. Issues of civic pride are immaterial to them ... let local councillors worry about all that. The airlines just see markets and catchment areas. No two airports have identical catchment areas (indeed, catchment area varies by individual route), but some have very significant degrees of overlap. Whether you, I or anybody else dislikes the fact, LPL and MAN are two such airports whose catchments do overlap significantly. That is what the airlines see, and they couldn't care less if it hurts the feelings of individuals consumed by passionate civic pride.

Ryanair do recognise that LPL and MAN do not serve identical catchment areas - it is likely that they will maintain certain routes such as DUB and certain mainstream Mediterranean resorts from both - because each airport can sustain a standalone service. But there are also routes which Ryanair will perceive as serving a larger catchment area, and they will operate that route from the airport which offers them the highest potential for profit. We can all see the way the wind has blown in that respect.

Now, you claim that moving flights from Girona to Barcelona, Bergamo to Milan or Modlin to Warsaw is "quite different" from moving flights from LPL to MAN because "they are airports which serve the same urban centre". Well, the City of Girona is actually the capital of its own province (also called Girona). Its airport primarily serves that city, but its catchment overlaps that of Barcelona and Ryanair has used it on that basis. The city of Bergamo has a metropolitan area population of almost 500K and its own top-flight Serie A football club, Atalanta. Its catchment area significantly overlaps Milan, but it is not Milan - it is Bergamo. Modlin Airport is located alongside the county town of Nowy Dwor Mazowiecki; there are many miles of green fields between this town and Warsaw, but the catchment area overlaps significantly and Ryanair uses it accordingly.

Meanwhile, the distance between the airports of Liverpool and Manchester is 30.7 miles by road. Completely consistent with the examples listed above. Distinct cities, yes, but with airports serving a catchment with significant overlap whether we like the idea or not. Just like BGY/MXP; GRO/BCN; WMI/WAW and others. Ryanair treat these two airports accordingly in their planning, just as they do with the pairs outlined above. So my premise is not flawed. You just don't like it! If in doubt, read your own quote about how Blue Air, Wizz and Czech see things.

I believe it is reasonable to infer that if airline charges aren't going to rise to pay for the investment then the increased revenue needed will come from the other main cash cow, the passenger.
But if an airport business succeeds in in growing its customer base it will have the ability to spread its costs amongst more passengers meaning that the need to increase charges can be avoided.

Finally I would ask you to bear in mind that a number of the contributors on this thread rely on the airport for their livelihoods, so telling them 'not to take things personally' could also be perceived as patronising.
The concept of relying on an airport for one's livelihood is not alien to me! But most folks who work at airports are well aware that they are working for a business which competes with neighbouring businesses for some of the same customers. I don't see why staff should need to be sheltered from that reality. Airports compete with each other for business all the time. That is not about to change regardless of whether it upsets people or not.
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Old 7th Oct 2015, 18:01
  #494 (permalink)  
 
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MAG tried to steel Wizz before and were not successful. As long as they are at DSA I think we will not see them move. LPL and DSA allow them to maximise passengers, MAN would hurt DSA.
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Old 7th Oct 2015, 18:04
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Originally Posted by j636
MAG tried to steel Wizz before and were not successful. As long as they are at DSA I think we will not see them move. LPL and DSA allow them to maximise passengers, MAN would hurt DSA.
How are we not 100% sure wizz approached MAN but MAN said no to their demands?

Unless you were at the meetings no-one can definitavely answer.
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Old 7th Oct 2015, 19:46
  #496 (permalink)  
 
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Liverpool up 6.14% in Sept 2015

Liverpool Airport recorded an eight successive month of growth in September of 6.14%. The growth was based on additional capacity in the market and improved network load factor performance.
September saw the launch of new service to Amsterdam, with Flybe operating a three times daily into Amsterdam. Looking ahead, October will see two new services inaugurated with a double daily service with Aer Lingus commencing on October 23rd, whilst Flybe will commence a single daily service to Edinburgh on October 26th.
In what has been a busy month at Liverpool Airport, new scheduled service to Barcelona operated by IAG member Vueling has been confirmed with a Christmas programme commencing December 20th with full scheduled service to commence at the end of March. Yesterday, Blue Air confirmed a twice weekly service to Cluj to commence in Summer 2016.
Traffic for the Calendar year remains 6% ahead of prior year and also ahead of levels seen during 2013.
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Old 8th Oct 2015, 02:46
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LAX

Come on now, MAG turn down a airline willing to fill a gap on the map. At the time MAN hadn't a single Eastern Europe route.
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Old 8th Oct 2015, 04:17
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MAG originally turned down the low cost brigade, so yes, why not.

If wizz wanted lots of perks for too little in the way of fees, then yes, why not say no thanks.

pictures aren't always shades of brilliant white and jet black......
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Old 8th Oct 2015, 04:48
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MAG pursued Wizz Air vigorously prior to the airline agreeing a new contract with Liverpool a couple of years ago.
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Old 8th Oct 2015, 05:26
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Again do you know that to be 100% fact amethyst?

You said yourself, their LPL contract was up for renewal, how do you know it wasn't wizz approaching MAN, even if it was just to keep LPL on their toes and garner a sweeter deal?
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