London’s links to the world are one of its greatest assets. Critical to business, high quality air travel is key to its continued success. But with no current prospects of increasing aviation capacity, London’s success faces clear dangers.
Despite prioritising projects such as Tube modernisation, Crossrail and Thameslink, all supported in the comprehensive spending review, Government has made no commitment to London’s airports - despite the private sector being willing to invest.
Ahead of Government’s review of national aviation policy, expansion at any airport in the South East has already been ruled out – and yet the number of passengers more than quadrupled from 50 million a year to 213 million a year between 1980 and 2008. Demand will continue to grow over the next decade at or near historic rates. In London alone demand is forecast to rise to 250 million passengers a year by 2030. Current airport capacity limits trips to around 140 million passengers a year, yet Government has no long-term plan.
To be able to compete, London must continue to sharpen its act. Heathrow is already full and at peak times, so is Gatwick. Investment in high speed rail may create some shift away from short haul and European flights if extended, but not enough to create the headroom needed.
To attract new investment, draw the best talent and pursue new markets London needs the best international connections – but, it is lagging behind. While Frankfurt has 47 flights a week to China, and Paris has 45 – London has 30. The capital has direct flights to only three Chinese cities, while Amsterdam and Frankfurt each have five. Other than a couple of charter operations to Goa, no UK airport, other than Heathrow, has any direct services to Brazil, Russia, India and China. In comparison, continental hubs in France, Germany and Holland, in Middle East and Far East countries, and in North and Latin America, are expanding the range and frequency of long haul destinations to business centres.
London’s success shouldn’t be taken for granted. The sustainability of London as a fulcrum of the global economy is not a given. Business leaders need access to an increasing number of international destinations and a world class service. Progress is already being made in improving passenger experience, but, as critical as that work is, it will only take us so far.
The biggest driver of poor service quality remains flight delays. Heathrow is one of the most delayed airports in Europe because its runways are congested. No airport of this size and economic significance can ever be truly world class when it runs at 99% of maximum permitted capacity. Its rival European hubs have headroom - operating at around three quarters of permitted capacity. Without that headroom, Heathrow will remain fragile and bedevilled by delays.
To remain globally competitive London’s international air links will need to grow in the next decade. There will be difficult balances to strike, but to be able to compete for trade and to look towards much needed growth, new runway capacity is needed. That is what will generate investment, tax revenue and jobs for Britain. Business will welcome the Government’s aviation policy review, but it mustn’t begin by ruling out potential solutions.