STN.......do you think
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I'm sure STN can do better under new owners. I don't think they need worry about EZY's small operation from SEN, an airport which can never climb above about 2 million pax per year and which can be sustained by its own catchment area without taking many away from STN's. STN should be supplying a regional market and could target specific long-haul destinations - why not go all out for the East Asian destinations which LHR is struggling to find slots for? I'm sure MAG will have some good ideas; they've taken Manchester to heights that few of us who lived up north in the past can believe.
Stop worrying about SEN, LTN and LGW - there's room for all of them alongside a revivified STN.
Stop worrying about SEN, LTN and LGW - there's room for all of them alongside a revivified STN.
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Do you genuinely believe that BAA has put in their maximum level of commitment to find new operators,
Lots of key and well perfoming routes have been lost
Think of all their airlines that have shifted presence to Gatwick and Luton in recent years. Norwegian, WOW Air, Air Berlin, Air Asia X, Atlantic Airways, Blue Air, El Al not to mention all the others that have since left Stansted like Cyprus Airways and Atlasjet and going even further back, Transavia (admitedly some of those have now left London altogether). There is no effort by BAA to try and maintain these services or indeed replace them.
Norwegian fit much better at LGW.
Transavia don't serve that market anymore.
Air Berlin don't know what they're doing anymore, though the Oneworld membership makes LGW a better bet.
"Right, look at all these operators Stansted has lost. They clearly saw something in Stansted, let's really get Gatwick and Luton quaking in their boots and fight for these services to come back. And let's offer LCC's fantastic financial deals they can't refuse by us recognising this is an alternative, low-cost gateway to London and let us bring all the skills, experience and relationships with a whole range of airlines we have at manchester to attract them into Stansted as well!"
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The difference is that Stansted doesn't need a fortune spent on it. Gatwick was aging and a transformation into a more modern airport was needed, especially for the non LCC's like BA. A brand new check-in hall in the North Terminal for BA, a new security area in the South plus many more improvements have all been completed since GIP's purchase.
Stansted doesn't need that transformation. It's already large and modern enough but it currently overcharges, as the CAA has found, and since little needs to be spent on improving the infrastructre, MAG may be able to offer more attractive financial deals to airlines much easier than you might think.
So for all those who worry that £1.5 billion for Stansted is too much, think again because Gatwick has costed GIP a lot more than that with all the infrastructure improvements they've had to make. Stansted costed £1.5 billion and that is what it is. MAG have already said they don't plan to expand or make major improvments at Stansted, and quite rightly so.
The thing is, it's not me doing the thinking. This is what MAG have already said they aim to do. They want to:
Attract airlines from rival airports Luton and Gatwick through financial deals and good customer service
Simon Calder's Q&A: Manchester airport buys Stansted - Business Analysis & Features - Business - The Independent
(Also mentions EasyJet as a target to base more planes and that Stansted is usually uncrowded and tranquil, so perhaps a go a trying to fight back from Southend and no need for heavy infrastructural investment like at Gatwick.)
Bring the success they've had with carriers at Manchester, namely Jet2, Monarch and EasyJet and try to attract them to open/expand at Stansted
Manchester Airports Group buys London Stansted Airport
And in the words of Charlie Cornish, Cheif Executive of MAG, the aim to fulfil Stansted's potential (note "potential" meaning it is already able to) as a "high quality alternative London access point for global air travellers."
Stansted sold to Manchester Airports Group | News | Travel Trade Gazette
By the way, WOW has not gone bust. They took over Iceland Express if that's what you're thinking.
Stansted doesn't need that transformation. It's already large and modern enough but it currently overcharges, as the CAA has found, and since little needs to be spent on improving the infrastructre, MAG may be able to offer more attractive financial deals to airlines much easier than you might think.
So for all those who worry that £1.5 billion for Stansted is too much, think again because Gatwick has costed GIP a lot more than that with all the infrastructure improvements they've had to make. Stansted costed £1.5 billion and that is what it is. MAG have already said they don't plan to expand or make major improvments at Stansted, and quite rightly so.
You're not thinking like a business
Attract airlines from rival airports Luton and Gatwick through financial deals and good customer service
Simon Calder's Q&A: Manchester airport buys Stansted - Business Analysis & Features - Business - The Independent
(Also mentions EasyJet as a target to base more planes and that Stansted is usually uncrowded and tranquil, so perhaps a go a trying to fight back from Southend and no need for heavy infrastructural investment like at Gatwick.)
Bring the success they've had with carriers at Manchester, namely Jet2, Monarch and EasyJet and try to attract them to open/expand at Stansted
Manchester Airports Group buys London Stansted Airport
And in the words of Charlie Cornish, Cheif Executive of MAG, the aim to fulfil Stansted's potential (note "potential" meaning it is already able to) as a "high quality alternative London access point for global air travellers."
Stansted sold to Manchester Airports Group | News | Travel Trade Gazette
By the way, WOW has not gone bust. They took over Iceland Express if that's what you're thinking.
Last edited by FRatSTN; 11th Feb 2013 at 10:45.
Skipness -
WOW have just announced today that they are increasing LGW flights to 13 per week from June 2nd, so seem not to have gone bust!
Generally -
There will be no huge increases in passenger throughput anywhere unless and until the economy improves. There are no fleets of shiny new aeroplanes looking for a home in the London area. During the next year or two, STN may halt its decline, LTN and LGW will remain largely static, as will LHR having reached its capacity. That's not to say there will be no new operators, no migration between airports, but the overall picture has not suddenly become brighter.
FRatSTN -
It's the easiest thing in the world to slag off "management" when you haven't a clue about the pressures they face in the real world.
WOW have just announced today that they are increasing LGW flights to 13 per week from June 2nd, so seem not to have gone bust!
Generally -
There will be no huge increases in passenger throughput anywhere unless and until the economy improves. There are no fleets of shiny new aeroplanes looking for a home in the London area. During the next year or two, STN may halt its decline, LTN and LGW will remain largely static, as will LHR having reached its capacity. That's not to say there will be no new operators, no migration between airports, but the overall picture has not suddenly become brighter.
FRatSTN -
It's the easiest thing in the world to slag off "management" when you haven't a clue about the pressures they face in the real world.
There is a lot of delusional talk on here regarding MAG. It will be the market that decides the future of STN. Sure, MAG can do their best to improve STN’s prospects but they cannot create markets that do not exist or are unsustainable.
The new terminal was built at STN when no real market existed for it and it took years before the passenger throughput had risen to a level to justify the heating & lighting bills! Even then, many airlines used STN not necessarily out of choice but because market forces dictated other airports were not available to them. It’s going to be interesting going forward but do not expect miracles!
The new terminal was built at STN when no real market existed for it and it took years before the passenger throughput had risen to a level to justify the heating & lighting bills! Even then, many airlines used STN not necessarily out of choice but because market forces dictated other airports were not available to them. It’s going to be interesting going forward but do not expect miracles!
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Nobody is saying that there will be miracles or major increases in traffic. MAG have said they could get Stansted back up to 2007 levels in a decade and even that I think is a little optimistic.
I'm simply just saying what MAG's aims are for the future and that they have very strong potential and competetive advantges over other London airports and owners because of the experience and success in their existing portfolio.
That's rich coming from you. Given half a chance you'd shut the place down. Anybody with the slightest bit of understanding about Stansted's management will agree that they overcharge their customers. Even the CAA agrees for goodness sake! I think your weird obsession of hating the place blinds you from the potential advantages and changes that WILL occur under new ownership. Of course I'd love you to point out what all the pressures are for Luton's management...
Either your hatred for Stansted is due to it's managment, in which case you are highly hypocritical or it's something more physical about the place, which I think is more the case as you made your views on that quite clear on that elsewhere.
It's funny then really isn't it that Blue Air and El Al both chose Stansted initally. Why on Earth didn't they see sense to serve the perfectly located and highly accessible Luton from the start? Stansted clearly can't be that bad in it's physical terms.
What's even more funny is that they both transferred to lower cost, smaller, less facillitated Luton not long after the management doubled Stansted's charges. And since the ones who either later went bust or pulled out of the London market altoghther were those who chose to move to Luton rather than Gatwick says a lot about the cost basis really!
I'm simply just saying what MAG's aims are for the future and that they have very strong potential and competetive advantges over other London airports and owners because of the experience and success in their existing portfolio.
It's the easiest thing in the world to slag off "management" when you haven't a clue about the pressures they face in the real world.
Either your hatred for Stansted is due to it's managment, in which case you are highly hypocritical or it's something more physical about the place, which I think is more the case as you made your views on that quite clear on that elsewhere.
It's funny then really isn't it that Blue Air and El Al both chose Stansted initally. Why on Earth didn't they see sense to serve the perfectly located and highly accessible Luton from the start? Stansted clearly can't be that bad in it's physical terms.
What's even more funny is that they both transferred to lower cost, smaller, less facillitated Luton not long after the management doubled Stansted's charges. And since the ones who either later went bust or pulled out of the London market altoghther were those who chose to move to Luton rather than Gatwick says a lot about the cost basis really!
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Whilst its rarely discussed on this forum, I'll be particularly interested to see what happens with freight operations at STN under the new ownership. DHL UK and UPS are both based at the excellent EMA which has now become STN's smaller sibling. I hope that any increases at STN will not be at the expense of EMA, but I am sure this is an area where MAG will be using their experience and connections in order to expand their customer base at STN.
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WOW have just announced today that they are increasing LGW flights to 13 per week from June 2nd, so seem not to have gone bust!
they have very strong potential and competetive advantges over other London airports
The key point is the market isn't growing massively so you're looking at nicking back traffic off LTN and maybe SEN in the first instance. I want to understand how it is they intdend to attract traffic that BAA failed to snare and make money at the same time. That's the bit I don't get. Are they going to subsidise medium term losses at STN from MAN profits?
Last edited by Skipness One Echo; 11th Feb 2013 at 15:32.
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"WOW Air" is an Icelandic LCC that took over Iceland Express recently and flew from Stansted before moving to Gatwick in the autmn.
The purpose of the sale is not just to generate new traffic, but to enhance competition between the London airports. This generates price wars and helps consumer prices to fall where all the airports are now competing on price and other services with each other to win traffic, exactly what Gatwick has been able to quite easily do being seperted by the BAA monopoly a few years ago now.
Although it may be in MAG's aims to get the likes of Jet2, Monarch etc. setting up at Stansted, it probably won't be reality for the reasons you say. But MAG will enhance the competition and it gives Stansted more of a chance to grow, even if that growth is at the expense of Gatwick and Luton, but that's what competition is!
Essentially, the more competiton, the more cost cutting and financial delas there is in order to win traffic, which reduces prices for consumers, which increses demand, which increses airline revenues and profits which may ultimately attract new traffic in the future. Competition is often bad for the airports individually, but good for consumers and the market as a whole.
In terms of competitive advantages. The big one is MAG's expertise and strong relations with a huge range of carriers at it's other UK airports. GIP and Abertis (Luton owners) haven't really had this level of experince in the UK market.
Stansted also is the only UK airport with room left to grow significantly, so in the medium and longer term when the market does increase, Stansted will be the only one really to cater for it. Other examples include not having the need to expand or invest heavily in infrastructure and even the increasingly growing relationship with Ryanair and it's major presence at MAN, EMA and BOH is also a huge bonus.
The purpose of the sale is not just to generate new traffic, but to enhance competition between the London airports. This generates price wars and helps consumer prices to fall where all the airports are now competing on price and other services with each other to win traffic, exactly what Gatwick has been able to quite easily do being seperted by the BAA monopoly a few years ago now.
Although it may be in MAG's aims to get the likes of Jet2, Monarch etc. setting up at Stansted, it probably won't be reality for the reasons you say. But MAG will enhance the competition and it gives Stansted more of a chance to grow, even if that growth is at the expense of Gatwick and Luton, but that's what competition is!
Essentially, the more competiton, the more cost cutting and financial delas there is in order to win traffic, which reduces prices for consumers, which increses demand, which increses airline revenues and profits which may ultimately attract new traffic in the future. Competition is often bad for the airports individually, but good for consumers and the market as a whole.
In terms of competitive advantages. The big one is MAG's expertise and strong relations with a huge range of carriers at it's other UK airports. GIP and Abertis (Luton owners) haven't really had this level of experince in the UK market.
Stansted also is the only UK airport with room left to grow significantly, so in the medium and longer term when the market does increase, Stansted will be the only one really to cater for it. Other examples include not having the need to expand or invest heavily in infrastructure and even the increasingly growing relationship with Ryanair and it's major presence at MAN, EMA and BOH is also a huge bonus.
Last edited by FRatSTN; 11th Feb 2013 at 16:03.
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They dropped the ball with MAN massively when they became a group and it took focussing like a l@ser beam to get it right again. Now they own a London airport there is a concern they'll do it all over again.
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The key point is the market isn't growing massively so you're looking at nicking back traffic off LTN and maybe SEN in the first instance. I want to understand how it is they intdend to attract traffic that BAA failed to snare and make money at the same time. That's the bit I don't get. Are they going to subsidise medium term losses at STN from MAN profits?
Now consider the (in)famous 2005 EC guidelines on state aid in the aviation sector (now being rewritten to be made even stricter) which lay down what can be done with public funds (i.e. what startup incentives publicly-owned airports can legally offer to airlines, essentially very little). These currently form the basis of IIRC nearly 20 in-depth European Commission investigations into various European airports' deals with airlines (well, in 90% of cases with one airline in particular, but that's not my point here).
The EC guidelines don't apply to privately owned airports because the assumption is that a private investor is spending his own money and trying to earn a commercial return, but this assumption may not hold for a public investor. Now one can argue about whether or not the guidelines are appropriate, proportionate, adequately enforced, etc. (and many people do), but the fact of the matter is that they are there.
Heathrow is privately owned.
Gatwick is privately owned.
Southend is privately owned.
London City is privately owned.
Luton is in public ownership but the operator is a private company.
None of these airports are subject to the EC2005 guidelines.
If MAG is publicly owned, then STN is subject to the guidelines. So if STN is winning any traffic away from other airports with low-cost deals, one could imagine those other airports complaining to the Commission...
Just a thought...
Of course I'd love you to point out what all the pressures are for Luton's management...
1. Limited footprint constraining development (artificially imposed by the freeholder who will not agree to expanding into Hertfordshire).
2. Approaching capacity, especially for overnight parking and at peak times. (Being addressed by the planning application now under consultation)
3. Until recently, approaching the break-point in the concession agreement, making further capital investment uneconomic. (now resolved by the extension of the concession)
4. I expect there will be limits to the amounts of capital available for investment, and IRR hurdles to achieve. Additionally, there will be a requirement to achieve returns on previous investments, and an expectation of contribution to group profits.
5. Limited runway length, limited parking stands and a congested approach in difficult topography are amongst the operational challenges.
6. Need to manage the facility in accordance with the requirements of a freeholder controlled by a local council with its inherent community sensitivities
I'm sure there are many others, but I expect those are what keeps the CEO focussed.
Management at STN have been 'between a rock and a hard place'. The airport was built and developed using subsidies from LHR. When those were ruled illegal, they then had to compete in a freer market. But they knew their owners were deep in debt, having bought BAA very expensively, funded by a mountain of debt that has to be serviced.
So what could they do? Reduce prices to 'compete' (with other BAA airports in the main) and therefore cannibalise their revenues and descend into serious losses? Or keep prices high, minimise investment and try to keep in the black? They chose the latter, but were then hit by recession which decimated their passenger numbers.
They fought to retain STN because its income helped service the loans, but when MAG came along with a generous offer, they snatched their hand off - they couldn't believe their luck that MAG would pay so much.
I found it instructive that the deal was agreed within a few days of the auction closing. Normally, there would have been more haggling, but BAA knew MAG were overpaying, so wanted to clinch the deal asap!
Further lessons in very basic business studies are available at your local college
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STN.......do you think
STN freight operation has already taken a step forward with Cargolux starting a HKG route, with the potential of a few more if the demise of Manston is true. This could also bring along the air cargo Germany with it, so not ALL bad
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I personally cant wait to see what happens at the airport. Its exciting times and no matter what way you look at it, MAG has brought Stansted for one thing only........to make money! If they saw no future i doubt they would have even looked at it. Good luck MAG.....bring in lots of airlines so i can get more type ratings!
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Stanstead infastucture
LGS6753
Expanding from your poor rail services comments (MAG buy STN) - between Bishops Stortford and London there are I think 8 level crossings
It is all well and good for various sites to waffle on in corporatese about Stanstead in 30 and links to crossrail but it is my belief that fast frequent trains and level crossings do not go together
I have recently spent 40 mins at Spellbrook crossing hoping to get home a couple of miles away
Does anyone think a road fairy will miraculously built flyovers to replace the level crossings? That would be interesting at Spellbrook and Sawbridgeworth! Or will they just close them permanently? God help Bishops Stortford town centre then
The rail line is in part still in the 1950's
Without major investment (paid by who?) good rail links surely will not happen
Expanding from your poor rail services comments (MAG buy STN) - between Bishops Stortford and London there are I think 8 level crossings
It is all well and good for various sites to waffle on in corporatese about Stanstead in 30 and links to crossrail but it is my belief that fast frequent trains and level crossings do not go together
I have recently spent 40 mins at Spellbrook crossing hoping to get home a couple of miles away
Does anyone think a road fairy will miraculously built flyovers to replace the level crossings? That would be interesting at Spellbrook and Sawbridgeworth! Or will they just close them permanently? God help Bishops Stortford town centre then
The rail line is in part still in the 1950's
Without major investment (paid by who?) good rail links surely will not happen
