London’s Heathrow Airport has announced a new package of commitments deliverable with expansion, designed to connect the UK’s nations and regions to growth markets around the world. Taken together they have the potential to deliver billions of pounds worth of trade and investment opportunities, reversing a lost decade of connectivity which has seen regional connections to long-haul markets squeezed out of the UK’s hub airport.
The commitments follow the recent release of the Independent report from the National Connectivity Task Force that highlighted that equitable access for the UK's regions must be a key consideration when the case for future runway capacity in the South East is determined this summer. In an exclusive interview with Routesonline at Newcastle Airport just ahead of this year’s Routes Europe, chair of the Task Force, Lord John Shipley, supported the announcement by Heathrow and commitment to grow domestic UK links.
"Speaking on behalf of the Task Force, we welcome the announcement from Heathrow's management and commitment to support connectivity from the regions. It helps us to move the debate on as we will not seriously address rebalancing the economy until we provide better connectivity. The fact that this is being discussed is itself important as it keeps connectivity top of the agenda," he said.
The measures outlined by Heathrow’s management would boost the seven existing domestic routes served from the airport (Aberdeen, Belfast City, Edinburgh, Glasgow, Leeds Bradford, Manchester and Newcastle), offering the potential for better timed and more frequent flights, but also the introduction of direct flights from nine other domestic airports not currently served by Heathrow, meaning that a total of at least 16 regional airports will have the opportunity of direct links to the UK’s hub.
The commitments include a review of airport charges to help keep existing domestic routes commercially attractive to airlines from January 2016; establishing a new Heathrow Route Development Fund of around £10 million in start-up capital for airlines to support five new routes for three years; partnering with UK airports, LEPs, Chambers of Commerce, national and regional governments to work with airlines to establish new domestic routes through Heathrow; working with government to re-designate public service obligation (PSO) routes to Heathrow; and potentially working with any organisation that wants to operate Northolt as a satellite runway for UK routes until Heathrow is expanded.
The commitments have been informed by the recommendations of the National Connectivity Task Force, with a remit to recommend how connectivity between the UK’s nations and regions and the major airports in the South East can be enhanced. They build on a previous announcement by easyJet that it would consider operating from an expanded Heathrow, competing on several existing domestic routes and providing new links to four airports (Inverness, Belfast International, the Isle of Man and Jersey) across the UK.
Alongside these routes, the proposed Heathrow Route Development Fund will support five further links for airports around the country which need access to global markets but where the market doesn’t initially support those routes following expansion. Airports which could benefit from this support include Liverpool, Newquay and Humberside.
The domestic discussions from Heathrow comes at a time when Amsterdam Schiphol has more links to the UK’s nations and regions than Heathrow and Gatwick combined. As a result, Schiphol has gained traffic that would otherwise support new long haul routes, jobs and economic activity in the UK, claims Heathrow.
“Expanding Heathrow could deliver close to 80,000 jobs and up to £114 billion of GDP outside London and the South East. We have been listening to businesses, politicians and now to the National Connectivity Task Force, and our announcement shows that we have a plan to deliver what Britain needs,” said John Holland-Kaye, chief executive officer, Heathrow Airport.
The recent Transport Select Committee’s Smaller Airport Inquiry found that constrained capacity at Heathrow has damaged domestic air connectivity from smaller airports, which are instead connected to other European hub airports. But, while airport hubs in northern Europe – Amsterdam Schiphol, Frankfurt and Paris Charles de Gaulle - are attracting more transfer traffic from the UK, Heathrow remains a key access point to international and long-haul travel for many passengers from smaller airports, according to its report.
The value of regional links to Heathrow is demonstrated by the fall in passenger numbers at smaller airports where these links are withdrawn, said the Committee. For example, Durham Tees Valley airport experienced a 75 per cent reduction in overall passenger numbers following the withdrawal of its Heathrow service in 2009.
To support its UK connectivity promises Heathrow is proposing reducing domestic passenger charges by over a third. The domestic passenger charge for airlines flying from Heathrow would be reduced by a third, from £29.59 today to £19.59, under new proposals announced by the hub airport that could take effect as early as January 1, 2016.
The £10 departing passenger discount for passengers departing Heathrow to other UK airports, will make domestic flights more affordable for passengers and, according to Heathrow officials, will support the commercial viability of domestic services which have been squeezed out of the UK’s hub because of airlines having to make tough choices between using their limited slots for domestic or long-haul routes.
This would be supported by a £5 departing passenger discount for European destination passengers, from £29.59 today to £24.59. This is expected to encourage fuller planes, making more efficient use of constrained hub capacity.
“Our proposal to cut passenger charges by a third for domestic services will help us continue to drive the tourism, exports, inbound tourism and foreign direct investment that supports economic growth across the whole of the UK,” said Holland-Kaye.
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