Heathrow-2
State of Play: Heathrow Third Runway Debate
The case for R3:
* Will increase Heathrow capacity by approximately 140000 movements annually.
* Will enable Heathrow to maintain and strengthen hub role.
* Will encourage the addition of thin long-haul routes to developing markets.
* Will create 14000 jobs at Heathrow and more in the wider economy.
* Will increase connectivity to UK regions via new scheduled services supported by PSO arrangements.
* Will represent a boost to the economy of a reported £74Bn spread over 60 years.
* Will provide employment within the UK construction industry for the duration of the build.
* Some construction related contracts will be awarded across regional UK.
* It is suggested that increased competition will drive down fares to the benefit of consumers.
* The project will send a clear message that Brexit Britain is a truly global nation, open for business.
The case against R3:
FINANCIAL ISSUES
* Cost. Direct cost of construction put at £15Bn to £18.5Bn before overruns.
* These direct costs to be borne by HAL, but likely to be 100% underwritten by the taxpayer.
* R3 will give rise to a support access liability of £10Bn to £20Bn according to TfL. Predominantly taxpayer funded.
* HAL gearing is currently around 87% and is set to rise to 91%. Figures of this magnitude are generally considered dangerously high by the financial markets, increaing the risk of default down the line. 81% gearing at Thames Water caused consternation within government at the time. If HAL were to default, the taxpayer would be on the hook for an all-in R3 related liability in the region of £30Bn.
* The highly contentious EU 'divorce bill' is set at £39Bn. The combined cost of making just one additional part-time runway work at Heathrow closely approaches this sum. A bit of perspective there.
* Major cities around the world are delivering new multi-runway airports at a fraction the cost of expanding Heathrow by just a third. Examples include Istanbul, La Guardia. Here in Australia, Western Sydney Airport (Badgerys Creek) is budgeted at AUD $5.3Bn directly plus $1.7Bn in access support works. That delivers a working twin-runway airport for high-cost Sydney at a shade under £4Bn. Heathrow R3 comes in at 6x to 8x this sum - and adds less than half the movements Badgerys Creek could deliver. The Heathrow proposal appears monstrously overpriced by any measure.
* It has emerged that ministers have agreed a 'poison pill' deal for the Heathrow NW runway proposal which would reimburse HAL losses under circumstances which see the project compromised. It is alleged in the media that counter-proposals by Gatwick and Heathrow Hub were not offered a similar deal. Cynics suggest that this arrangement highlights a predetermined preferred outcome by government.
* The support works bill of upto £20Bn will fall directly to taxpayers and will be drawn against tax funding for national infrastructure investment. Interested parties argue that English regions already deprived of state infrastructure investment for two generations will be locked out for at least another decade if projects in London are allowed to monopolise national funding yet again. Crossrail2 proposals, as well as Heathrow R3, fuel this concern. Feelings on this subject are running very high, particularly across the English regions which argue that London is stealing their lunch, dinner and tea. Research published by respected academic institutions suggest that their complaints have merit.
* The Financial Times has published an article questioning whether HAL will actually be able to raise finance on the scale required. Passenger charges at Heathrow already exceed those at competing European hubs by 40%. They cannot raise charges further and remain competitive, and in any case, charges are regulated by the CAA who pledge to keep charges broadly in line with today. Meanwhile, company debt already stands at a staggering £13.4Bn as of 2017, and shareholder funds have fallen from £5.5Bn in 2006 to £703M more recently. HAL's £847M dividend in 2017 is set against after tax profits of just £516M. So, before R3 construction, diividends are already part-financed by debt expansion. The likelihood of a massive dividend cut lasting several years, from a company with very high gearing, operating in a heavily price-regulated environment conspire to make this particular "compelling investment" a very hard sell. Will it be another case of taxpayer funds to the rescue? Credit to the FT for the article advising these figures.
* Alleged benefits to regional UK depend upon discredited 'trickledown' theory. Aside from the modest short-term contracts related to the construction phase. Beyond this, the regions stand to lose jobs in favour of London once R3 becomes operational. These were dubbed "displaced jobs" in the Transport Committee debate.
* Construction of R3 will make necessary the removal / relocation of the Lakeside 'Energy from Waste' recycling plant at an estimated cost of £1Bn. Compensation due to neighbouring residents and businesses will be substantial also.
* Is there genuinely any possibility that R3 will fully pay back the cost of making it a reality? If not, surely alternatives make more sense. Does R3 make financial sense by any measure?
* It is claimed that an expanded Heathrow will deliver lower fares for consumers due to increased competition. But the high costs implied make this highly unlikely in reality. Though new capacity at Gatwick and / or Stansted could meet this goal?
* With R3, Heathrow will be capped at 480000 movements per annum. Even if government agreed to lift this cap (unlikely) only a further increase of around 5% would be deliverable.
OPERATIONAL ISSUES
* 140000 additional movements per annum isn't a great return for this level of investment.
* 15% of those slots are set to be ringfenced for use by (taxpayer-supported) marginal domestic flights. A PSO mechanism is likely to be implemented to make this work.
* EasyJet proposes to bid for a significant share of these new slots. A fine company, undoubtedly. But their business is P2P no-frills short-haul. Routes such as Lanzarote and Marrakech were mentioned at the recent RABA HubLAB conference. Airports including Eindhoven and Bergerac were pitching their credentials. Fine destinations, all. But not aligned with the aspirations upon which R3 is being sold to public and politicians alike. Isn't Heathrow supposed to unlock niche routes to upcoming far-flung growth cities in India, China, Brazil etc? No point in even mentioning Russia given the prevailing diplomatic climate.
* At the same conference, FlyBe advise that they would consider additional services from Heathrow subject to securing business-friendly (peak) slots, the "right" costs and charges, plus zero-rated domestic APD!
* The demand for additional slot capacity in the London Airports system has been coming overwhelmingly from no-frills short-haul operators such as Ryanair, EasyJet, Jet2 and Norwegian. Not quite as sexy as new schedules to Chengdu and Bengaluru, but short-haul leisure is fhe real source of volume growth. And the needs of this market would be well-served by expansion at Gatwick and Stansted.
* A new runway at each of Gatwick and Stansted could be delivered for less than the cost of R3 alone. With far less risk to the public purse. And that would deliver upto 300000 new slots for the SE, versus 140000 for R3. Compelling?
* Meanwhile, long-haul itself is increasingly moving away from the hubbing model to P2P. Is Heathrow the solution to yesterday's problem? Operators including Norwegian, Primera Air and Thomas Cook are establishing networks of low-fare long-haul networks from smaller airports. Gatwick itself is already offering around 50 long-haul routes. Manchester is right up there too. Glasgow, Edinburgh, Birmingham, Newcastle - all offering their own long-hauls. Stansted moving into this market too with Primera and Emirates just added. The claim that Heathrow is Britain's only hope is shown up as nonsense with every passing day.
* At a recent meeting of the Transport Committee, it was stated that Heathrow R3 would result in a substantial loss of direct flights from regional airports. The number quoted was a loss of 74000 fewer flights per annum by 2030 rising to 161000 by 2050. That number actually exceeds the 140000 additional flights which R3 accommodates in the first place. Switched away from disadvantaged regions to overheated Heathrow at astronomical cost? How can any rational analyst sign up to this?
* Routes at risk typically include Emirates scheduled NCL-DXB and Hainan Airlines MAN-PEK (they've just added EDI too). Academic studies have demonstrated that services such as these bring outsized economic benefits to the regions they serve. The loss of routes such as this in favour of a Shuttle to Heathrow would be catastrophic to regional UK's competitiveness. Do we actually propose to 'invest' £30Bn to strip 161000 flights annually from regional UK in favour of 140000 extra at Heathrow instead? Parallel universe exonomics?
* IAG, Heathrow's largest airline operator by far (incorporating British Airways) opposes the R3 proposal unequivocally.
* Heathrow R3 will reportedly bring 323000 people into the Heathrow 51 Decibel footprint for the first time, taking the overall total to 1.15 million people. Concerns are also raised that Heathrow will breach air quality rules with R3. Government forecasts also indicate a 33% increase in road vehicle traffic around Heathrow, in contrast to HAL's suggestion that there will be no increase at all. A 'senior Labour figure' informed Robert Peston that R3 proposals are set to fail Labour's 'four tests'.
* If long-haul business flights are indeed the prime objective for Heathrow, could they be accommodated by other means? Let us consider the hypothetical addition of 20 new daily long-haul flights. Each one represents approximately 90 seconds of runway occupancy, and needs access for arrival and departure. So three minutes per visiting aircraft x20 means one hour of runway occupancy total. And that means 30 minutes on each of the current departure and arrival runways. Whilst undoubtedly controversial, would extending Heathrow's operating hours by 30 minutes be less damaging than imposing a third runway on the area? Worth thinking about. One could even add a runway at Gatwick too!
* Other long-haul solutions include upgrading existing schedules to larger aircraft types, consolidating high-frequency routes such as Heathrow to New York services onto fewer but larger aircraft. And of course, the long-established practice of slot trading. If a long-haul route is sufficiently compelling it will displace a short-haul to Gatwick, Stansted or City. And in the case of Heathrow's primary hub carrier - BA - reshuffling SH slots to LH is absolutely straightforward anyway. They control a huge bank of slots.
* With respect to Heathrow's hub role, one cannot just presume the attractiveness of the product. Transfers within T5 need one hour connection time to work reliably. Inter-terminal transfers are much worse ... quite notorious, actually. There is no guarantee that regional travelers will flock back to Heathrow in preference to now familiar single terminal transfers at competing hubs such as Amsterdam and Dubai. These are lower cost airports too.
* The notion that business travelers will stay at home if no non-stop flight is available doesn't stand up to scrutiny. Even London-based executives are capable of changing planes in Dubai or Chicago occasionally!
* The R3 charm offensive purports that the UK's air cargo capability will be substantially compromised if R3 does not go ahead. But again, this also fails to stand up to scrutiny. Heathrow is the UK's number one cargo gateway by VALUE, not by weight or bulk. One can accommodate alot of gems, iPhones and gold ingots in the hold of a passenger flight. Is there actually a cargo capacity crunch at Heathrow in reality? Well, if so, Stansted has evolved into a very capable cargo centre of excellence for fhe SE. East Midlands and Doncaster Sheffield have carved a similar niche in the centre of the country. And Scotland has Prestwick. Plus, of course, underfloor cargo capacity is also available in abundance on many of our regional passenger flights. Is there really an issue here?
And finally, I would just like to mention one piece of propaganda which really peeves those of us working in aviation dunnunda. Apparently, according to Heathrow PR, stats should only really consider pax who cross an international boundary in determining an airport's status in the global hierarchy. Sydney to Perth ... unimportant! Melbourne to Darwin ... forget about it! Even New York to LA (for our US friends) ... nah, forget about it, mate! But Heathrow to Dublin? Heathrow to Brussels? They're proper flights! Now you're talking ...
On the balance of evidence, I must conclude that the Heathrow R3 proposal is such a supremely terrible idea that it is amazing that it is being taken seriously in a developed country. New runways at each of Gatwick and Stansted make so much more sense from every perspective.
* Will increase Heathrow capacity by approximately 140000 movements annually.
* Will enable Heathrow to maintain and strengthen hub role.
* Will encourage the addition of thin long-haul routes to developing markets.
* Will create 14000 jobs at Heathrow and more in the wider economy.
* Will increase connectivity to UK regions via new scheduled services supported by PSO arrangements.
* Will represent a boost to the economy of a reported £74Bn spread over 60 years.
* Will provide employment within the UK construction industry for the duration of the build.
* Some construction related contracts will be awarded across regional UK.
* It is suggested that increased competition will drive down fares to the benefit of consumers.
* The project will send a clear message that Brexit Britain is a truly global nation, open for business.
The case against R3:
FINANCIAL ISSUES
* Cost. Direct cost of construction put at £15Bn to £18.5Bn before overruns.
* These direct costs to be borne by HAL, but likely to be 100% underwritten by the taxpayer.
* R3 will give rise to a support access liability of £10Bn to £20Bn according to TfL. Predominantly taxpayer funded.
* HAL gearing is currently around 87% and is set to rise to 91%. Figures of this magnitude are generally considered dangerously high by the financial markets, increaing the risk of default down the line. 81% gearing at Thames Water caused consternation within government at the time. If HAL were to default, the taxpayer would be on the hook for an all-in R3 related liability in the region of £30Bn.
* The highly contentious EU 'divorce bill' is set at £39Bn. The combined cost of making just one additional part-time runway work at Heathrow closely approaches this sum. A bit of perspective there.
* Major cities around the world are delivering new multi-runway airports at a fraction the cost of expanding Heathrow by just a third. Examples include Istanbul, La Guardia. Here in Australia, Western Sydney Airport (Badgerys Creek) is budgeted at AUD $5.3Bn directly plus $1.7Bn in access support works. That delivers a working twin-runway airport for high-cost Sydney at a shade under £4Bn. Heathrow R3 comes in at 6x to 8x this sum - and adds less than half the movements Badgerys Creek could deliver. The Heathrow proposal appears monstrously overpriced by any measure.
* It has emerged that ministers have agreed a 'poison pill' deal for the Heathrow NW runway proposal which would reimburse HAL losses under circumstances which see the project compromised. It is alleged in the media that counter-proposals by Gatwick and Heathrow Hub were not offered a similar deal. Cynics suggest that this arrangement highlights a predetermined preferred outcome by government.
* The support works bill of upto £20Bn will fall directly to taxpayers and will be drawn against tax funding for national infrastructure investment. Interested parties argue that English regions already deprived of state infrastructure investment for two generations will be locked out for at least another decade if projects in London are allowed to monopolise national funding yet again. Crossrail2 proposals, as well as Heathrow R3, fuel this concern. Feelings on this subject are running very high, particularly across the English regions which argue that London is stealing their lunch, dinner and tea. Research published by respected academic institutions suggest that their complaints have merit.
* The Financial Times has published an article questioning whether HAL will actually be able to raise finance on the scale required. Passenger charges at Heathrow already exceed those at competing European hubs by 40%. They cannot raise charges further and remain competitive, and in any case, charges are regulated by the CAA who pledge to keep charges broadly in line with today. Meanwhile, company debt already stands at a staggering £13.4Bn as of 2017, and shareholder funds have fallen from £5.5Bn in 2006 to £703M more recently. HAL's £847M dividend in 2017 is set against after tax profits of just £516M. So, before R3 construction, diividends are already part-financed by debt expansion. The likelihood of a massive dividend cut lasting several years, from a company with very high gearing, operating in a heavily price-regulated environment conspire to make this particular "compelling investment" a very hard sell. Will it be another case of taxpayer funds to the rescue? Credit to the FT for the article advising these figures.
* Alleged benefits to regional UK depend upon discredited 'trickledown' theory. Aside from the modest short-term contracts related to the construction phase. Beyond this, the regions stand to lose jobs in favour of London once R3 becomes operational. These were dubbed "displaced jobs" in the Transport Committee debate.
* Construction of R3 will make necessary the removal / relocation of the Lakeside 'Energy from Waste' recycling plant at an estimated cost of £1Bn. Compensation due to neighbouring residents and businesses will be substantial also.
* Is there genuinely any possibility that R3 will fully pay back the cost of making it a reality? If not, surely alternatives make more sense. Does R3 make financial sense by any measure?
* It is claimed that an expanded Heathrow will deliver lower fares for consumers due to increased competition. But the high costs implied make this highly unlikely in reality. Though new capacity at Gatwick and / or Stansted could meet this goal?
* With R3, Heathrow will be capped at 480000 movements per annum. Even if government agreed to lift this cap (unlikely) only a further increase of around 5% would be deliverable.
OPERATIONAL ISSUES
* 140000 additional movements per annum isn't a great return for this level of investment.
* 15% of those slots are set to be ringfenced for use by (taxpayer-supported) marginal domestic flights. A PSO mechanism is likely to be implemented to make this work.
* EasyJet proposes to bid for a significant share of these new slots. A fine company, undoubtedly. But their business is P2P no-frills short-haul. Routes such as Lanzarote and Marrakech were mentioned at the recent RABA HubLAB conference. Airports including Eindhoven and Bergerac were pitching their credentials. Fine destinations, all. But not aligned with the aspirations upon which R3 is being sold to public and politicians alike. Isn't Heathrow supposed to unlock niche routes to upcoming far-flung growth cities in India, China, Brazil etc? No point in even mentioning Russia given the prevailing diplomatic climate.
* At the same conference, FlyBe advise that they would consider additional services from Heathrow subject to securing business-friendly (peak) slots, the "right" costs and charges, plus zero-rated domestic APD!
* The demand for additional slot capacity in the London Airports system has been coming overwhelmingly from no-frills short-haul operators such as Ryanair, EasyJet, Jet2 and Norwegian. Not quite as sexy as new schedules to Chengdu and Bengaluru, but short-haul leisure is fhe real source of volume growth. And the needs of this market would be well-served by expansion at Gatwick and Stansted.
* A new runway at each of Gatwick and Stansted could be delivered for less than the cost of R3 alone. With far less risk to the public purse. And that would deliver upto 300000 new slots for the SE, versus 140000 for R3. Compelling?
* Meanwhile, long-haul itself is increasingly moving away from the hubbing model to P2P. Is Heathrow the solution to yesterday's problem? Operators including Norwegian, Primera Air and Thomas Cook are establishing networks of low-fare long-haul networks from smaller airports. Gatwick itself is already offering around 50 long-haul routes. Manchester is right up there too. Glasgow, Edinburgh, Birmingham, Newcastle - all offering their own long-hauls. Stansted moving into this market too with Primera and Emirates just added. The claim that Heathrow is Britain's only hope is shown up as nonsense with every passing day.
* At a recent meeting of the Transport Committee, it was stated that Heathrow R3 would result in a substantial loss of direct flights from regional airports. The number quoted was a loss of 74000 fewer flights per annum by 2030 rising to 161000 by 2050. That number actually exceeds the 140000 additional flights which R3 accommodates in the first place. Switched away from disadvantaged regions to overheated Heathrow at astronomical cost? How can any rational analyst sign up to this?
* Routes at risk typically include Emirates scheduled NCL-DXB and Hainan Airlines MAN-PEK (they've just added EDI too). Academic studies have demonstrated that services such as these bring outsized economic benefits to the regions they serve. The loss of routes such as this in favour of a Shuttle to Heathrow would be catastrophic to regional UK's competitiveness. Do we actually propose to 'invest' £30Bn to strip 161000 flights annually from regional UK in favour of 140000 extra at Heathrow instead? Parallel universe exonomics?
* IAG, Heathrow's largest airline operator by far (incorporating British Airways) opposes the R3 proposal unequivocally.
* Heathrow R3 will reportedly bring 323000 people into the Heathrow 51 Decibel footprint for the first time, taking the overall total to 1.15 million people. Concerns are also raised that Heathrow will breach air quality rules with R3. Government forecasts also indicate a 33% increase in road vehicle traffic around Heathrow, in contrast to HAL's suggestion that there will be no increase at all. A 'senior Labour figure' informed Robert Peston that R3 proposals are set to fail Labour's 'four tests'.
* If long-haul business flights are indeed the prime objective for Heathrow, could they be accommodated by other means? Let us consider the hypothetical addition of 20 new daily long-haul flights. Each one represents approximately 90 seconds of runway occupancy, and needs access for arrival and departure. So three minutes per visiting aircraft x20 means one hour of runway occupancy total. And that means 30 minutes on each of the current departure and arrival runways. Whilst undoubtedly controversial, would extending Heathrow's operating hours by 30 minutes be less damaging than imposing a third runway on the area? Worth thinking about. One could even add a runway at Gatwick too!
* Other long-haul solutions include upgrading existing schedules to larger aircraft types, consolidating high-frequency routes such as Heathrow to New York services onto fewer but larger aircraft. And of course, the long-established practice of slot trading. If a long-haul route is sufficiently compelling it will displace a short-haul to Gatwick, Stansted or City. And in the case of Heathrow's primary hub carrier - BA - reshuffling SH slots to LH is absolutely straightforward anyway. They control a huge bank of slots.
* With respect to Heathrow's hub role, one cannot just presume the attractiveness of the product. Transfers within T5 need one hour connection time to work reliably. Inter-terminal transfers are much worse ... quite notorious, actually. There is no guarantee that regional travelers will flock back to Heathrow in preference to now familiar single terminal transfers at competing hubs such as Amsterdam and Dubai. These are lower cost airports too.
* The notion that business travelers will stay at home if no non-stop flight is available doesn't stand up to scrutiny. Even London-based executives are capable of changing planes in Dubai or Chicago occasionally!
* The R3 charm offensive purports that the UK's air cargo capability will be substantially compromised if R3 does not go ahead. But again, this also fails to stand up to scrutiny. Heathrow is the UK's number one cargo gateway by VALUE, not by weight or bulk. One can accommodate alot of gems, iPhones and gold ingots in the hold of a passenger flight. Is there actually a cargo capacity crunch at Heathrow in reality? Well, if so, Stansted has evolved into a very capable cargo centre of excellence for fhe SE. East Midlands and Doncaster Sheffield have carved a similar niche in the centre of the country. And Scotland has Prestwick. Plus, of course, underfloor cargo capacity is also available in abundance on many of our regional passenger flights. Is there really an issue here?
And finally, I would just like to mention one piece of propaganda which really peeves those of us working in aviation dunnunda. Apparently, according to Heathrow PR, stats should only really consider pax who cross an international boundary in determining an airport's status in the global hierarchy. Sydney to Perth ... unimportant! Melbourne to Darwin ... forget about it! Even New York to LA (for our US friends) ... nah, forget about it, mate! But Heathrow to Dublin? Heathrow to Brussels? They're proper flights! Now you're talking ...
On the balance of evidence, I must conclude that the Heathrow R3 proposal is such a supremely terrible idea that it is amazing that it is being taken seriously in a developed country. New runways at each of Gatwick and Stansted make so much more sense from every perspective.
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Where do you get 140,000 extra movements from? It’s 260,000.
480k + 260k = 740k.
In fact, looking at your post, there are a lot of contradictions and errors in there.
480k + 260k = 740k.
In fact, looking at your post, there are a lot of contradictions and errors in there.
Thread Starter
Interesting analysis, although your ATM figures are a bit flaky:
No - 480,000 ATMs pa is the current cap with two runways. Clearly R3 isn't just intended to provide 5% more capacity.
Various figures are being bandied around, but the consensus seems to be that R3 will increase capacity to between 700,000 and 740,000 ATMs pa, ie an increase of between 220,000 and 260,000. The lower figure appears to be more realistic as you don't automatically get 50% more capacity by adding 50% more runways, even if one will now be operating in mixed-mode.
Various figures are being bandied around, but the consensus seems to be that R3 will increase capacity to between 700,000 and 740,000 ATMs pa, ie an increase of between 220,000 and 260,000. The lower figure appears to be more realistic as you don't automatically get 50% more capacity by adding 50% more runways, even if one will now be operating in mixed-mode.
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OzzyOzBorn,
That post has to go down as one of the most biased attempts at summarising ever to have graced this forum. No prizes for guessing where your preference lies.
A few one sentence lines for the benefits and a long winded attempt at discrediting it, mainly full of supposition, untruths and your own opinions.
If you are going to take the time to write out a state of play then at least make it accurate and balanced.
That post has to go down as one of the most biased attempts at summarising ever to have graced this forum. No prizes for guessing where your preference lies.
A few one sentence lines for the benefits and a long winded attempt at discrediting it, mainly full of supposition, untruths and your own opinions.
If you are going to take the time to write out a state of play then at least make it accurate and balanced.
* IAG, Heathrow's largest airline operator by far (incorporating British Airways) opposes the R3 proposal unequivocally.
More competition and lower fares driving demand upwards is bad news in the short term as they then need to fight harder for market share by upping spending on new aircraft and hard product to remain competitive. Simply awful for short term shareholder value. They would much prefer a closed monopoly, and while we're at it, maybe send DL and VS back to Gatters?
BA will survive and prosper, they're big and ugly enough to deal with this, remember the dire warnings about opening up LHR to new entrants in 1991? God I'm getting old...
Gonzo - Thankyou for correcting those movements numbers. You are quite right ... it is 260000 additional movements. I now believe my original source was referring to number of additional aircraft visits (turnarounds) anticipated as opposed to runway movements. My error not picking up on that, and I'm pleased that you have pointed it out. I want my data to be accurate.
Of course, this does also mean that the contribution which would be made to London area airports capacity by new runways at Gatwick / Stansted included the same error. So those numbers are correspondingly higher (basically doubled) as well. The 74K and 161K figures quoted for shortfalls at regional airports are taken from a different source so these are as presented. The 15% number set to be ringfenced for domestic flights also stands.
Thanks again for highlighting the error.
Of course, this does also mean that the contribution which would be made to London area airports capacity by new runways at Gatwick / Stansted included the same error. So those numbers are correspondingly higher (basically doubled) as well. The 74K and 161K figures quoted for shortfalls at regional airports are taken from a different source so these are as presented. The 15% number set to be ringfenced for domestic flights also stands.
Thanks again for highlighting the error.
S1F - I'm aware of the reasons why R3 would be opposed by IAG. But comments made by Willie Walsh do oppose R3. That seems clear. Are you suggesting that IAG secretly wants R3 to proceed?
Thread Starter
Fifteen percent of 260,000 additional movements equates to more than 50 additional daily departures to domestic destinations. Nobody seriously expects that to happen.
DaveReidUK - I am in complete agreement with you that those 15% of new slots are unlikely to be taken up in full by operators for use on domestic flights on a commercial basis. My reference to the comments made by FlyBe allude to this ... see the conditions they set out. Those within the industry can see the obvious flaws in the plan very easily.
The problem is that MP's across regional UK are being sold the line that these flights WILL be coming to their local airport. And that they will supposedly deliver outsized economic benefits to their constituency. And that a PSO mechanism will be used to bring that about. When you write that "nobody seriously expects that to happen" you need to insert "within the aviation industry". Many Westminster MP's are completely convinced that those slots will be filled as promised. Their heads have been filled with this idea, and many appear motivated to cast their vote on the strength of this.
Even on these PPRuNe forums, many posters write with confidence concerning their expectation of new scheduled flights between Heathrow and their local regional airport.
Once the truth dawns, the political votes will have been cast and the funds allocated long before.
The problem is that MP's across regional UK are being sold the line that these flights WILL be coming to their local airport. And that they will supposedly deliver outsized economic benefits to their constituency. And that a PSO mechanism will be used to bring that about. When you write that "nobody seriously expects that to happen" you need to insert "within the aviation industry". Many Westminster MP's are completely convinced that those slots will be filled as promised. Their heads have been filled with this idea, and many appear motivated to cast their vote on the strength of this.
Even on these PPRuNe forums, many posters write with confidence concerning their expectation of new scheduled flights between Heathrow and their local regional airport.
Once the truth dawns, the political votes will have been cast and the funds allocated long before.
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Ozzy,
The figure may not be more the 50 per day but that doesn't mean there won't be any. You seem to be saying no domestic flights will happen.
This will be very good for many regional's and why shouldn't they be all for it?
Why are you personally so against Heathrow expansion?
The figure may not be more the 50 per day but that doesn't mean there won't be any. You seem to be saying no domestic flights will happen.
This will be very good for many regional's and why shouldn't they be all for it?
Why are you personally so against Heathrow expansion?
Prophead - I cannot see how you draw the inference that I expect no new domestic flights at all. I even wrote "unlikely to be taken up in full" in the post you are referring to.
The reason I oppose R3 is outlined in my main post. There is no reason to repeat all that, so I invite you to re-read the section on cost in particular. I also believe that a new runway at each of Gatwick and Stansted will better address the needs of London's fastest growing sector: no-frills short-haul driven by Ryanair, Jet2 etc. That is where the big demand for new SE runway slots is coming from.
On a personal note, I have four flights over the next five days with hotel stays in between. I'll continue to follow the debate with interest but I don't know to what extent I'll be able to respond in the meantime.
The reason I oppose R3 is outlined in my main post. There is no reason to repeat all that, so I invite you to re-read the section on cost in particular. I also believe that a new runway at each of Gatwick and Stansted will better address the needs of London's fastest growing sector: no-frills short-haul driven by Ryanair, Jet2 etc. That is where the big demand for new SE runway slots is coming from.
On a personal note, I have four flights over the next five days with hotel stays in between. I'll continue to follow the debate with interest but I don't know to what extent I'll be able to respond in the meantime.
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Of course they do.
How naive to believe WW wants to prevent his largest airline from expanding. Classic protectionist behaviour because he wants it, just doesn’t want to pay for it & doesn’t want any new competitors (ie EasyJet).
Badgery’s a poor comparator on costs. Best comparable expansion of an airport is HKG & their third runway.
And I agree with @Prophead - mixing statements on one side with effusive opinion on the other does not a balanced summary make. Your factual error on ATM isn’t the only error which, I’m afraid, undermines your whole post.
How naive to believe WW wants to prevent his largest airline from expanding. Classic protectionist behaviour because he wants it, just doesn’t want to pay for it & doesn’t want any new competitors (ie EasyJet).
Badgery’s a poor comparator on costs. Best comparable expansion of an airport is HKG & their third runway.
And I agree with @Prophead - mixing statements on one side with effusive opinion on the other does not a balanced summary make. Your factual error on ATM isn’t the only error which, I’m afraid, undermines your whole post.
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From reading the pros and cons it does seem clear that the primary driver of traffic growth is European leisure and therefore LGW and Stansted are better placed for expansion at reasonable cost. This would also avoid further distorting UK public transport infrastructure investment which sees London secure 54% of the investment whilst having 15% of the population. Thank you Ozy for the full account.
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S1F - I'm aware of the reasons why R3 would be opposed by IAG. But comments made by Willie Walsh do oppose R3. That seems clear. Are you suggesting that IAG secretly wants R3 to proceed?
Fifteen percent of 260,000 additional movements equates to more than 50 additional daily departures to domestic destinations. Nobody seriously expects that to happen
Who can say how things will be in 100 years?
With increasing congestion, ever higher fuel costs, and likely road pricing/mile on the roads; with increasing chaos, delays, cancellations, strikes, and unfeasibly high fares on the railways; and the inability to predict journey times on both modes of transport, air travel will become an increasingly attractive option, especially as the delays at Heathrow will be eliminated by having a third rwy. The abundance of available slots will make the secondary slot market obslete thus the costs of operations will reduce significantly and other, smaller, carriers will operate from Heathrow.
At 4 roundtrips/day, for example, 50 additional daily departures to domestic destinations is not that many. It's just 12 new destinations, but a huge boost for regional connectivity with far more comprehensive cover than HS2. Domestic air travel can also reach places where road and rail cannot (Northern Ireland, jersey, Guernsey, Isle of Man, etc..). This is important for the country, so PSO will be used if necessary.
Once outside the EU, the "neo-liberal" economics of the single market won't apply, so if MPs want domestic links between their constituencies and Heathrow, governments may agree to aid where necessary to help economic development. Subsidies of this nature would be far better value for money than pouring money into the black hole of the franchised railways.
Yes, yes, OK, granted, it's a fair comment that it's an over optimistic assumption that we'll be outside the EU by the time the third rwy is up and running!
BTW Mods, the new format for PPRUNE is awful!
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You may want to read the more recent comments he’s made when the Arora Group suggested they could build it more cheaply.
But cost is exactly the point. WW is absolutely correct to baulk at cost figures anything like those mentioned. IAG is far better served by the status quo. IAG can expand at Madrid, Barcelona, Dublin, Gatwick and more. Especially if they do eventually take over Norwegian.
I also disagree with your suggestion that the cost of expanding Heathrow should only be compared with other airport upgrade projects. The fact that entire new twin-runway airports can be built in various other countries (including those with high real estate prices) for a fraction the cost of upgrading Heathrow by one third is utterly damning. That's the point and it is valid.
If the cost of the R3 proposals was £4Bn - like Badgerys Creek - then I wouldn't object to it either. But its all-in cost including access upgrades is in the ballpark of £30Bn. That is what WW sees. So he is right. If that is the price (and we're told it is) then expanding Gatwick / Stansted instead is a far superior option for London.
I also disagree with your suggestion that the cost of expanding Heathrow should only be compared with other airport upgrade projects. The fact that entire new twin-runway airports can be built in various other countries (including those with high real estate prices) for a fraction the cost of upgrading Heathrow by one third is utterly damning. That's the point and it is valid.
If the cost of the R3 proposals was £4Bn - like Badgerys Creek - then I wouldn't object to it either. But its all-in cost including access upgrades is in the ballpark of £30Bn. That is what WW sees. So he is right. If that is the price (and we're told it is) then expanding Gatwick / Stansted instead is a far superior option for London.
Last edited by OzzyOzBorn; 17th Jun 2018 at 10:23. Reason: Paragraph added.
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Careful what you wish for !
Whilst it’s all very well welcoming EZY with open arms this will erode IAGs connectivity, precisely the premise on which R3 is being sold to the public.
Do you honestly believe that EZY (who will no doubt be in their own terminal) will offer the same supposed seamless connectivity as IAG !
Not a cat in hells chance.
You “may” get lower fares , but that’s all and even this is not a given based on the debt/gearing and the need for HAL to recover those funds.
On a second point, UK MPs are being promised the earth by the Heathrow propaganda machine, if its not a direct flight its a juicy new logistic hub.
They are visiting EVERY Chamber Of Commerce in the country with the same promise and same presentation,
It really is Emperor’s new clothes stuff !
Finally what is the ACTUAL PRICE POINT where even the Heathrow evangelists would say the cost is too high.
Can you please let us know as you appear totally blind to these costs ?
PLEASE - WHAT IS THE FIGURE ?
Whilst it’s all very well welcoming EZY with open arms this will erode IAGs connectivity, precisely the premise on which R3 is being sold to the public.
Do you honestly believe that EZY (who will no doubt be in their own terminal) will offer the same supposed seamless connectivity as IAG !
Not a cat in hells chance.
You “may” get lower fares , but that’s all and even this is not a given based on the debt/gearing and the need for HAL to recover those funds.
On a second point, UK MPs are being promised the earth by the Heathrow propaganda machine, if its not a direct flight its a juicy new logistic hub.
They are visiting EVERY Chamber Of Commerce in the country with the same promise and same presentation,
It really is Emperor’s new clothes stuff !
Finally what is the ACTUAL PRICE POINT where even the Heathrow evangelists would say the cost is too high.
Can you please let us know as you appear totally blind to these costs ?
PLEASE - WHAT IS THE FIGURE ?
Last edited by Navpi; 17th Jun 2018 at 12:49.