ON THE SOAPBOX – Sir Howard Davies – Chairman of the Airports Commission

The Airport Commission, chaired by economist Sir Howard Davies, has been much in the news over the last few months and will eventually submit its report to Downing Street at some point after the 2015 General Election.

Sir Howard has been most open in speaking to both the media and other interested parties.  Since BTN is an electronic publication it seemed to us an interview by email would be both original and enterprising.  We have limited the number of questions.

Sir Howard:

 1) Whilst IATA can provide a broad industry view, it's not in a position to speak on any individual airline's behalf. Will the Commission therefore send a questionnaire to all scheduled airlines at Heathrow (LHR) and Gatwick (LGW) and ask them:

(a) As an investor in LHR and/or LGW, and to meet their customer/operating needs, which airport do they favour for expansion?

(b) If LHR was the favoured option, would LHR airlines foresee themselves

   i) expanding their own services, potentially with flights to new destinations, or
   ii) if a LGW airline, foresee relocating from LGW to LHR, or
   iii) retaining the status quo?

(c) If LGW was the favoured option, would LGW airlines foresee themselves

   i)  expanding their own services, potentially with flights to new destinations, or
   ii)  if an LHR airline, foresee relocating from LHR to LGW, or
   iii) retaining the status quo?

2) As bilateral agreements underpin air links between nations, and airlines wait years to get slots at LHR (eg Avianca), will the Commission request feedback/concerns from the UK Diplomatic Community (ie foreign embassies and High Commissions) about their perceived lack of trading capacity, including freight. And along the same lines, can the Commission ask IATA to request member airlines who currently do not/cannot get into Heathrow, but could under a bilateral, to do so. Non IATA members should also be brought into the fold.

It is important for the Commission to have a strong understanding of how airlines operate. We need to look at history to understand how the sector has developed, as well as considering what its priorities are today and – hardest of all – how it may respond to a changing environment in future. That is why we engaged with a wide range of airlines, including low-cost and legacy carriers, and airline alliances, in the course of the work leading up to our interim report. We intend to continue that engagement over the coming year to inform our final report, both through umbrella groups such as IATA and through discussions with individual airlines.

Might the Commission review its prognosis that only one new runway is required in SE England by 2030, and another not before 2050, a finding that does not enjoy common acclaim amongst those in the industry. Even if that prognosis may not change before a recommendation is made to government, will the Commission recommend regular and formal reviews of the situation? You state a new runway is needed by 2030 but at the same time acknowledge that both Gatwick and Heathrow are full. What is the rationale?

The London and SE airports system has responded dynamically to increasing demand for aviation and will continue to do so. Although Heathrow’s runways are full, it continues to accommodate growing numbers of passengers. Other airports are attracting new carriers and services, including new long haul routes at Gatwick. Competition within the sector is likely to continue to drive innovation and growth. Therefore, we do not believe that capacity to expand within the system is exhausted. However, our forecasts indicate that the limits of what can be achieved may be reached over the coming decade and a half, at which point some runway capacity will be required.

This assessment is broadly in line with the submissions made to us by the owners of the UK’s major airports – and reflects the fact that in a largely privatised and competitive airports sector, investors will not pay for expensive new capacity unless they are confident it will be well-used.

The Commission’s assessment of need was arrived at after a thorough process which took into account a range of forecasts and potential scenarios for the future development of the aviation industries. This included considering various models for airline growth, a range of scenarios for global economic and technological developments and some plausible options around global action to control carbon emissions from aviation.

Of course, no forecasts are perfect, which is why we have indicated that we do not think it would be appropriate at this stage to reach a view on the potential location, or exact timing, of any second additional runway. There is too much uncertainty regarding the long-term development of the industry and the global economy. Instead, we have said that we will suggest to Government in our final report when and how this question should be reviewed.

If the Commission were to recommend LHR for the first additional runway, a situation that would not enjoy all political consent, would a completely new hub airport elsewhere still be a consideration?

Our Interim Report ruled out most of the options for building a completely new airport, but identified the need for further work to understand whether a new airport in the inner Thames Estuary might be viable. Our intention, in the second half of this year, is to reach a conclusion that will allow us either to identify a credible proposal for a new airport in the inner Thames Estuary, or to demonstrate clearly why the concept is not feasible. But ultimately it will be for the Government to decide what decisions it wishes to take once the Commission has provided its final report next year.

When do you think the earliest date a new runway can be operational?

Our initial estimates – based on the submissions we received last year – is that a second runway at Gatwick would be possible by 2025. Heathrow Airport Ltd’s proposed north west runway would be possible by 2026. For Heathrow Hub’s runway extension, we think the safety case might take longer to develop as this is a previously untried operational concept, so we assumed a date of opening of 2028. However, we will be doing more work to examine all three options ahead of our final report and it is possible that all three of those dates could change.

There are no airline/airport experts acting as advisors to the Commission although the railway industry is represented. Why is this?

We have benefited from a wide range of discussions with both airports and airlines (as with other stakeholders) over the course of our work, and this has given us a wide perspective on the operations of the aviation industry, and the issues and challenges facing it. The industry accommodates a wide range of perspectives and views, and it was crucially important to us to have a sense of the breadth of opinion on these key issues. We intend to continue with this engagement and dialogue in the next phase of our work.

Other than the two selected, 55 other ideas/schemes were turned down including Stansted. How is it that only the Mayor’s project has been highlighted for further review?

Our reasons for rejecting schemes varied considerably. In some cases, we rejected proposals because they were very similar to other proposals which either contained more detail or were simply a better way of providing new capacity at a particular site. This was the case with some of the proposals we considered around Heathrow, for example. In other cases, proposals would not have provided any new capacity at all, once their implications on the wider airport system were taken into account.

A number of locations for new hub airports with four or more runways were proposed to us, including sites in Oxfordshire, at Stansted and in the inner and outer Thames Estuary. In all cases bar the inner Estuary, we found that there were significant challenges, which did not appear to be outweighed by the potential benefits offered. The position in relation to an inner Estuary airport however was more nuanced. The challenges remain, but the potential benefits, especially in relation to noise and regeneration, appear stronger than for other new hub sites. We have therefore stated that we will carry out additional analysis of these options, looking not just at the proposal from the Mayor but also those from private sector promoters, to properly understand some of the implications of a new hub airport at those sites.

AND FINALLY: Would you have taken the task on if you had really appreciated its complexity?

No comment (though I think it is easier than assembling a competitive England team for the World Cup).

 

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Avro returns for CityFlyer

British Airways passengers at London City Airport should not be alarmed to find themselves flying once again in an Avro RJ85 over the next couple of months.

In the past Cello has supported a number of airlines both in the UK and Europe on an ad-hoc basis but this agreement with the British Airways operator marks a major vindication of Cello’s strategy of diversification.  Cello was launched in 2010 and has established its reputation in the VIP charter sector carrying top musicians, sportsmen and women, royalty and corporate customers.
 
Luke Hayhoe GM Commercial and Customer, BA CityFlyer said: “We have been working with Cello utilising their aircraft on an ad hoc basis for some time.  We are happy with the quality of service and the flexibility they provide and are therefore delighted to be able to work with them on this contract until one of our new Embraer aircraft is delivered in May.”  www.flycello.com

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DB9 from Hertz

Motoring enthusiasts with deep pockets can now whisk away a car of their dreams, including the Bentley Continental GT, Bentley Flying Spur, Aston Martin DB9, Range Rover Sport, Mercedes C63 AMG, BMW X5, Mercedes SL63 AMG, Mercedes E400 AMG Coupe, Audi Q7 and Maserati Ghibli.

Featuring a VIP customer service and Hertz’s Make and Model Guarantee, the Dream Collection has been rolled out at Hertz’s London Marble Arch and at Heathrow Airport.

Hertz Dream Collection cars are handed over to the customer in person by one of the specially trained Dream team, so that customers can bypass the counter.  The team will also help load bags into the car and configure devices such as NeverLost GPS according to the customer’s requirements.  In addition, each stage of the rental will be closely monitored to ensure complete satisfaction.

Customers must be aged 30 and over and have held their driving licence for a minimum period of five years.  Two credit cards are needed in order to qualify.  Cost for one day is £495, three days £1,275 and seven days £2,400.  www.hertzdreamcollection.co.uk

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Heathrow viewing platform

Passengers at Heathrow can now enjoy some plane spotting as they wait for their own flight to depart.  The new ‘View Heathrow’ platform at Terminal 4 is the first of its kind at Heathrow since the old Terminal 2’s viewing platform was closed along with the building itself.

The new 270 degree observation deck has a view of the southern runway, the control tower and British Airways’ Concorde.  Fixed ipads on the platform show live flight radars so that visitors can identify the aircraft movements in front of them, as well as binoculars to get a better view.

Kathryn Leahy, Director, Terminal 4, said: “We are proud to be opening this viewing facility for passengers.  We know that many travellers enjoy plane spotting and we are pleased to be able to provide them with the opportunity to do so once again.”

The deck, located between gates 15 and 16 was converted from an unused former airline lounge.  The observation deck is open to all passengers in Terminal 4 during normal operating hours.  www.heathrowairport.com

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Oxford to Jersey

A weekly ‘summer only’ service from Oxford Airport to Jersey is being introduced by Channel Islands-based Blue Islands.  It is technically a charter by the C.I. Travel Group and will be flown by a 46-seat ATR42 turboprop.   Flights start 10 May through to mid-September

Flights start 10 May through to mid-September. C.I. Travel says that the route will appeal to residents in Oxfordshire, the South Midlands and the north western Home Counties who can now conveniently fly from Oxford without the hassle of going to Birmingham or one of the London airports.  Some five million people live within an hour’s drive of the airport, which is close to the M40, A34, A40 and A44 road networks.

Departure times for the one hour flight are Oxford 09:40 and Jersey 08:00.  Passengers use the airport’s executive travel facilities and very close by car park.

Blue Islands also fly on a daily basis from Jersey to Bournemouth, Bristol, London City, Manchester and Southampton airports.

Oxford Airport is wholly-owned by the Reuben Brothers.  Their investment activities include private equity, real estate ownership and development.  At the end of February 2012 they purchased the London Heliport at London Battersea, the UK’s only CAA licensed heliport.  www.blueislands.com

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State aid and small airports

The European Business Aviation Association has welcomed the European Commission’s decision concerning operating aid for regional airports, which permits airports receiving less than 700,000 passengers per year, to continue having a range of funding options available to them.  This affects a significant number of UK airports looking for vital assistance on upgrades including Exeter, Bournemouth, Doncaster Sheffield and Inverness, all of which fell just under the threshold in 2013.

This affects a significant number of UK airports looking for vital assistance on upgrades including Bournemouth, Doncaster, Exeter, Sheffield and Inverness, all of which fell just under the threshold in 2013.

“We believe the Commission has taken a sensible approach to a sensitive issue,” says Fabio Gamba, CEO of the Association. “This measure not only fine-tunes and provides greater clarity on the application of State aids, but it as well offers a level of flexibility for the small regional airports that are most dependent on these funds.  As primary users of regional aerodromes, the business aviation sector has always argued that small regional airports hold intrinsic value for local communities, delivering, among other things, jobs and passenger spending power.  This value must be recognised as part of the economic sustainability of small airports; not just self-generated income alone.”

The European Commission has abandoned earlier considerations for limiting operating aid to airports under 300,000 passengers a year.  www.ebaa.org

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ON TOUR: Future of Business Aviation conference

It was a tale of two cities at EVIP’s first Future of Business Aviation conference held at the new Hilton Terminal 5 last week writes Alison Chambers.

On the one hand we had the ebullient New Yorker Kenny Dichter, Chairman of a brand new US fractional company, talking up the benefits of his venture Wheels Up, a business model centred around the venerable King Air – for which he has ordered 105 latest model 350is for his members.  His aim is to more than double the broad base of business aviation industry and refreshingly, he brought his whole family, including mum-in-law along to his presentation.

On the other was Martin Lener, Managing Director of Tyrolean Jet Services who, to the audience’s dismay, showed up a slide of a business jet with cobwebs around it to highlight the fact that utilisation was significantly down in Europe.  Yet his company is one of the lucky ones, not least because they have a contract to fly the British Royal family aboard their Airbus ACJ.

In Europe, as we heard at the Corporate Jet and Helicopter Finance conference this month, there are 300 business aviation operators and over 85% of them have just three or less aircraft in their fleets.  No wonder the whole industry is consolidating.  Lux Aviation has acquired UniJet of France to become Europe’s third largest business aviation group with 60 aircraft.  This is hard on the heels of its purchase of Abelag 18 months ago and more recently, Fairjet of Germany.  Eurojet in Birmingham is looking for a new owner.

Expanding Oxford Airport based charter company Hangar8, which acquired International Jet Club of Farnborough 18 months ago has confirmed its intention to join forces with one of the industry’s biggest air charter brokers, Air Charter Services (ACS).  David Savile, Non-Executive Director on the Hangar8 executive board will be able to lend good advice observers noted, calling on his experience with the former Air Partner Private Jets.

There are bright spots in the UK.  Fly Victor, set up by entrepreneur Clive Jackson bemoaning the lack of scheduled services out of Mallorca, claims to be doing rather well.  It now boasts 5,500 high net worth individual members who have just helped the company raise £5.5m to take the business into new territories including Russia and Central Europe.  Next year they take on the USA.  Mike Ryan, Head of Commercial Operations, describes it as the Remington effort.  The model is successful he says because it is fully transparent.  Members see online which operators they are going to fly with, aircraft type and cabin layout.  All are bona fide AOC operators.  Fly Victor works with 110 established operators, including Marshall-owned FlairJet and London-based LEA, and has call on 600 aircraft types from a Cessna Mustang to an Airbus ACJ. “You wouldn’t book a hotel if you didn’t know the name of it would you?,” he said, highlighting that transparency has to be crucial for the future of the charter industry.

“We are competing for the same business,” stressed Alex Berry, Group Sales and Marketing Director of Chapman Freeborn.  “We are talking here about the future of air charter, but it is not so complex today.  What the industry really needs to do is to refresh the customer pool.  What are we actually selling?

It’s not champagne, it’s not fancy catering it’s not luxury.  Some of the aircraft we charter aren’t fancy at all.  The Mustang doesn’t have a toilet.  It is the one finite commodity – time.  Buying your life back.  it is time for all of us in the industry to get more people educated on the merits of business – whether they fly NetJets,  PrivateFly, Fly Victor, the numerous charter operators.  We need to be challenging that anyone with significant wealth should have their head examined if they fly Ryanair or easyJet again.”

Transparency is what marketing supremo American Kenny Dichter is about clearly.  Having successfully made his name with Marquis Jet, where he made US$1.4bn of sales in confirmed flight hours, he is positioning Wheels Up as a private member’s club.   The initial membership fee is US$15,750, followed a year later by the first annual membership fee of US$7,250.  Then the per occupied flight hour cost is US$3,950 for the first hour and a pro rata percentage charge on any portion of the next hour.  This includes everything, except for certain designated higher charging airports like New York’s JFK, where the additional cost is passed on to the member.  His goal is to obtain 1,200 and 1,400 members in the first year.  Included in the membership is Wheels Down where members enjoy access to events like the Masters (we have Sir Nick Faldo joining us there he proudly told delegates), the Oscars, the Super Bowl where they are entertained in VIP Wheels Down lounges.  “We are attacking the corporate market with this message – CEOs like us, but CFOs love us,” he said.

Squarely on the future theme Richard Lugg, CEO of Hypermach, captured the delegates' imagination as he presented his Sonic Star concept.  Lugg is passionate about aviation and is fulfilling a long held wish to design and develop a supersonic craft.  Seven years in development a small but focused team are redefining the jet engine to create an aircraft that can fly Dubai to New York in the time it takes to watch an inflight movie.   Lugg has a heritage of speed having worked in military jet development and for NASA on the space shuttle.  He sees things differently, a vision that enables him to create a propulsion system that will drive a supersonic aircraft.   The first three aircraft he plans for Hypermach to build so removing risk for the eventual airframer – and he is already in discussions with an interested party.  Farnborough 2016 should see the first prototype in the form of an unmanned drone demonstrating the future of flight.

 
Two friendly business aircraft rivals Sean McGeough, President, Nextant and Scott Plumb, VP Sales for EMEA, Beechcraft, shared a platform to talk about light jet and turboprop markets.  Nextant is applying its “reimagined, rebuilt, reborn” philosophy to the Beechcraft C90, although Beechcraft is not so enamoured by the fact that its aircraft require “reimagining”.
 
Richard Koe, CEO of WingX, highlighted the relative opportunity for light jets in emerging markets but acknowledged the continuing predominant preference for large aircraft in RoW.  Lead markets for business jets are Turkey, Nigeria, China and South East Asia.  He also concluded with analysis of the US market, suggesting it to be the most interesting re-emerging market, with the influential come-back of very light jets set to provide the benchmark for future light aircraft business models worldwide.
 
A long and fascinating day.  Will supersonic executive travel come in our lifetime?  Probably.  http://evaint.com
 
Alison Chambers – Emerald Media  www.emeraldmedia.co.uk

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ANA goes wi-fi

The latest airline to offer wi-fi is Japan’s All Nippon Airways (ANA) who introduced the service on its international routes today (3 March).  The airline does charge and not by the hour too.  Up to 5MB - $US6, 10MB - $US12 - 20MB $US24. 

Passengers will be able to use their own devices, such as smartphone or tablet, to surf the web, access email and update social networks including Facebook and Twitter.  The latest Stock Market wire report is available on the portal site for free.

The ANA WiFi Service will be available on all class of selected international flights flown by Boeing 777-300ER and Boeing 767-300ER aircraft.

It is provided in partnership with JSAT Mobile Communications which supports the 'OnAir' programme.  www.ana.com

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CityJet to become WX

As reported by BTN at the beginning of the year (BTN 6 January http://www.btnarchive.co.uk/article/7158) CityJet, the Air France Irish registered airline who centre of operations is London City Airport is moving even closer to being sold with confirmation said to be imminent. 

The new owners will be turnaround specialist Intro Aviation, founded by German businessman Hans Rudolf Wöhrl.  Intro has acquired and subsequently sold a number of airlines, including German charter carrier LTU and the former British Airways’ subsidiary Deutsche BA.

Whatever happens, from the start of the summer season CityJet becomes IATA code WX.  It has around 40% of the slots at LCY, a similar number to British Airways.

The current CityJet fleet consists of 19 Avro RJ85 and 18 Fokker 50.  www.cityjet.com  http://introaviation.org

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Germanwings expands

Barcelona, Moscow, Paris and Zagreb will be added to the Germanwings programme this summer from Berlin Tegel.  The airline is owned by Lufthansa but is not part of Star Alliance.  The new routes are part of the handover of certain services from the parent company.  Germanwings is a budget operation rather than a ‘full service’ airline. 

The new routes are part of the handover of certain services from the parent company.  Germanwings is a budget operation rather than a ‘full service’ airline.

From 4 July Germanwings will fly from Berlin Tegel to Barcelona and Zagreb and on the 31 August will launch new services to Moscow Vnukovo and Paris Charles de Gaulle.

Since 2013 Germanwings offers three fare types, called Basic, Smart and Best, which offer different services.  While Basic is a classic no-frills offer that features hand-luggage only and no free catering, Best includes hold baggage, free snacks and drinks as well as access to some lounges for tier members of Miles & More, the Lufthansa frequent flyer programme.  Smart and Best are more or less comparable to the product that the airlines offered on the routes taken over by Germanwings.

The fleet is totally A320 series and Economy Class only and offers Sky Bistro (Bord Shop in German), a buy on board programme with food and drinks for purchase.  www.germanwings.com

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New York for £100

Laker Airways splashed the headline 30 years ago “New York for $100”, you had to queue with no reservations system and APD did not exist.

Now Biman Bangladesh Airlines is doing virtually the same from June onwards with a new twice weekly flight from Birmingham Airport to New York JFK.  In fact the initial fare will be £100 each way plus £69 APD from the UK and anything else the airport/handling agent adds, which they also call tax.

The fact that Biman can operate the service is due to the way the various bilaterals are drawn up.  Bangladesh has full ‘Open Skies’ with the US, and has fifth freedom rights out of the UK, with the exception of Heathrow.

The airline will be using a brand new Boeing two-class Boeing 777-300ER with full flat bed in Business Class, a fourth aircraft due from Boeing later this month.

Speaking on the occasion of the final DC10 passenger flight week at Birmingham Airport (See BTN 24 February), Kevin Steele, the airline’s MD said that he was excited with the prospect of operating into New York.  “We are getting a lot of interest,” he said.  At Heathrow Biman charges around £1,000 for a flight to Dhaka, easily undercutting one stop Middle East competitors.  www.biman-airlines.com

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SITA biometrics kiosks

Orlando International Airport has become the first in the US to offer international travellers from visa waiver countries the option to 'land, touch and go', using new SITA's Automated Passport Control (APC) kiosks to self-process for faster US border clearance.

The Greater Orlando Aviation Authority has confirmed that arriving passengers from 37 visa waiver countries can now enjoy quick and easy processing at US customs and immigration.

Orlando is the only airport in the United States to use these kiosks which allow international travellers, from countries that participate in the visa waiver programme, to self-process into the US.  Ten biometric APC kiosks are now available for travellers to complete their Customs Declaration form on a touch-screen, have their passports scanned and fingerprints and photograph taken prior to, and in preparation for, their interview with the US Customs and Border Protection (CBP) Officer.  The pre-processing significantly reduces the time to complete the clearance process.

The kiosks are complimentary to use and do not require registration in advance; however, travellers must have previously entered the US and have fingerprints on file with CBP.  The airport says that it has already seen a dramatic increase in the total number of travellers processed per minute.  www.sita.aero

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The Thames as a highway

London River Services is a division of Transport for London (TfL).  It does not own or operate any boats but licenses the services of other operators.  These are a mixture of leisure-oriented tourist services and a very successful commuter operation between Putney and The City.  www.tfl.gov.uk/river

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AND FINALLY: It is a monthly cruising update

Amongst the ‘going away presents’ at the recent P&O Britannia unveiling at Fish Island opposite Stratford’s Olympic Stadium was a strange blue container.

Most of the guests found the gift perplexing including Carnival’s UK Chairman David Dingle.

 A sleuth in the BTN office suggested that in fact it was a wine bottle container, which proved correct. However the only problem was that line’s beverage department had also supplied for departure a bottle of exclusive P&O Colture by Prosecco in its distinctive large bottle. The wine did not fit the bag!

David is a keen Portsmouth FC, the former FA Cup winners now lingering in League 2, or the Fourth Division according to traditionalists.

“At least the bottle bag is in Pompey colours – two examples of being not quite fit for purpose!” was all he could add.

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