gatwick vision report

bettersolution.gatwickairport.com 01

A better solution for London & the UKConnectivity, competition & certainty

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M25

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GATWICK

STANSTED

HEATHROW

LUTON

LONDON CITY

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Liverpool St Station

City of London

Westminster

The West End

Canary Wharf

Paddington StationVictoria StationLondon Bridge

St Pancras International

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A competitive and resilient airports system could deliver:

• The connectivity that London and the UK demands

• True airport competition

• More passenger choice, better service and lower fares

• Better resilience to disruption

• Less environmental impact than expanding Heathrow

• An affordable, privately financed solution


There is already much debate about possible answers, but we believe it is important to understand the questions surrounding the airport capacity debate before jumping to a solution. We must consider the unique realities of the London market and, very importantly, what passengers want and need for the future. We need to understand the huge amount of change that has happened in both the airline and airport industries over the past 10 years, and what trends we see going forward. The Airports Commission is rightly looking forward, rather than simply reinforcing the past.

Much is already changing in air travel – from the shift in traffic towards emerging markets, the emergence of huge new hub airports in the Gulf, through to the introduction of new aircraft which will help long-distance direct flights to bypass traditional hubs. Within London’s airports we have seen a transformation. The fact that the three largest are now separately owned, and are starting to compete, is a real game-changer.

We must also understand how the market really works now. Today, 87% of all passengers using London’s airports are simply starting or ending their journeys at them. This proportion is likely to increase in the coming years. This means, despite what the proponents of creating a ‘mega hub’ at Heathrow or in the Thames Estuary might say, that the importance of ‘transfer’ or ‘hub’ passengers is exaggerated.

Policy should be framed around the travel needs of all passengers and not dictated solely by those who only want to change planes when they fly through London. Transfer passengers are important. But they are very much in the minority, as are the routes that need their support. The evidence shows that today there simply isn’t the need for a ‘mega hub’ in London.

As the Airports Commission goes back to the drawing board, and looks at all the options, they will need to ensure that any recommended solution is deliverable, environmentally sustainable, and has a strong business case behind it. Scope for a degree of political consensus is also key. Surrounding all this is the crucial need to deliver certainty to airlines, businesses and communities.

Having started our detailed analysis in October 2012, a clear long-term vision for London and the UK which can meet these needs has emerged.

Our vision is for three competing major London airports, each with two runways eventually, complemented by London City for business traffic, and Luton and London Southend for predominately leisure.

The Airports Commission should recommend where the next single runway will be built and suggest where the next one should follow. In making that decision, the Commission will have to make recommendations based on clear selection criteria. I believe that the expansion of

Stewart WingateCEO London Gatwick

Foreword by Stewart Wingate

London enjoys world-class air links. It is one of the best-connected cities in the world, with 134 million passengers flying in and out each year1. But while there is spare airport and terminal capacity right now, London’s status as one of the world’s most important air transport markets will not last unless we act soon. We believe London will need a new runway by the mid-2020s.

87%

of passengers using London’s airports are simply starting or ending their journeys at them. 134mEach year 134 million passengers fly in and out of London.

A better solution for London & the UK Connectivity, competition & certainty2

Foreword by Stewart Wingate

Gatwick and, in time, perhaps Stansted as well, provides the best solution, and would solve the capacity issue for a generation.

More than anything else, I want to see true passenger choice. So far, the needs of passengers have been largely lost in the aviation debate. They should be able to choose where they fly to and from, and who they fly with. In the longer term, capacity has to be matched to the passenger need. Quite rightly, they want better value fares, new destinations, higher quality airports and more convenient door-to-door journeys each and every time they travel. Our vision, based on true airport competition, can deliver those benefits.

Gatwick has already invested more than £1 billion since the change of ownership in 2009. We’ve opened new direct routes to some of the fastest growing economies such as China, Russia, Vietnam, Turkey and Indonesia. In due course, there is likely to be a need to provide more regional capacity, thereby boosting UK connectivity from the regions. More competition will help to deliver the enhanced connectivity the UK economy needs. Where there is passenger

demand, the market should be able to respond, and in an affordable way.

There is huge potential for a new approach to air travel, but we do not believe that it should be at an unacceptable environmental cost. We just cannot see how mixed mode or additional runways at Heathrow can be justified against environmental criteria. Heathrow’s current noise ‘footprint’ is larger than all other western European ‘hub’ airports combined.

There is now an opportunity to look to the future and develop an airport strategy which will provide benefits to the UK for decades to come. As the debate continues and we gather our evidence, we will publish our findings online at bettersolution.gatwickairport.com

Gatwick looks forward to playing its part and doing the detailed work to support its vision of a competitive network of airports serving London and the rest of the UK.

Stewart WingateCEO London Gatwick

1billionSince 2009 over £1 billion has been invested in Gatwick, with one focus in mind – our passengers.

BELOW: Gatwick is striving to deliver the best passenger experience now and for the future.


The connectivity that the UK needsOur vision would see all of London’s existing airports supporting growth in air travel to strategic destinations. Gatwick is already supporting new connections to China, Vietnam, Russia and Turkey. Our vision is not unique – many of the world’s large cities have more than one major airport, rather than a single ‘mega hub’, to deliver the air travel connections passengers want.

More certaintyWe believe our solution is deliverable and will give passengers, communities and businesses the certainty they need. We are confident that, when all the evidence is taken into account, Gatwick will be the preferred option for the next runway.

True competition leading to more passenger choice, better service and lower faresReducing reliance on one dominant airport will give passengers a greater choice of carriers and destinations, and would lead to more competitive prices. Journey times to home or the office would also be shorter overall.

Less environmental impact Three equally sized airports serving London would have a much lower environmental impact than simply expanding Heathrow – whose noise impact easily exceeds the combined impact of all the other hub airports in Western Europe2. With a second runway at Gatwick, there would still be significantly fewer people affected by noise than at Heathrow. That doesn’t mean Gatwick doesn’t take local community concerns about noise and air quality seriously – we do.

The case for three airports with two runwaysIt would deliver:

An affordable, privately financed solutionWe are backed by a strong group of experienced shareholders and initial estimates indicate that a new runway and airport facilities at Gatwick could be funded privately and has a viable business case. We would also share with the Government a proportion of the cost of improved rail and road infrastructure.

More economic benefits spread across the south eastHaving three equally sized, well-connected airports in London would help spread the economic benefits of airport expansion across the south east rather than concentrating it in one location.

Greater resilience to disruptionBy spreading new capacity across different locations, rather than concentrating it all in one place, passengers at London’s airports would be less vulnerable to the effects of disruption at a single mega hub.

Building on our successful airportsOur vision means using all of London’s airports to their full potential, not closing any of them.

We believe that the best first step in delivering this vision is to build the next runway at Gatwick.



What is the situation today and what does the future hold?

In the short term, London’s airport system has the capacity and connectivity needed to meet demand.

Theoretically, London’s terminals could house 32% more passengers than they do already and its runways could accommodate around 25% more flights3. In practice, no airport should choose to operate close to 100% of capacity if it wants to maintain some degree of resilience to disruption. New runway capacity needs to be available before this level of usage is reached across London.

We know that in the 2020s, there will be a need for extra capacity. London is unique. We must also remember 87% of passengers using London’s airports are simply starting or ending their journeys at them4. This kind of demand is known as ‘Origin and Destination’ (O&D) within the aviation industry. By contrast, only 13% are ‘hubbing’ or transferring to another flight going elsewhere. This is because London is itself the largest single market for aviation in the world. Passengers want to fly to and from it. Not through it. As such, London should be seen as the hub for UK air travel – not one single airport.

In terms of destinations, it is clear that established markets will continue to be very important to London’s airport passengers. Today, Europe, North America, and to a certain extent the Far East, the Middle East, and the Indian Sub-continent dominate in terms of places passengers actually want to fly to.

Demand to fly to a range of emerging markets today is small in comparison, but it will also grow. Whilst today the UK is one of the best-connected countries in the world, we will need more direct links with key markets that are not currently being served. At Gatwick, we are already playing our part by opening new direct routes to fast-growing economies such as China, Indonesia, Russia, Turkey and Vietnam.

We are achieving that because London is unique in terms of the size of its air travel market. Airlines want to fly to and from it. To put it bluntly, there are enough people who want to fly to the city directly from Beijing, Jakarta, Moscow, Istanbul, Hanoi and Ho Chi Min City for routes to be viable and in many cases frequent. ‘Hub capacity’ is not a precondition for routes to these countries. As a result, we are making the best use of existing capacity and delivering the direct connections needed to grow exports and boost inward investment and tourism from key markets. We will need more direct air links to ensure the UK competes. As Gatwick’s new routes show, a traditional ‘hub’ airport is not the only way to deliver these.

The Airports Commission is rightly looking beyond how the aviation industry works today. In doing so, it is thinking beyond the traditional responses to the issue of airport capacity which have been looked at, and rejected, before. We need to get the questions right first and build the answers from there. The fundamental question should be: what will work for passengers and what are their future needs?

13%

Only 13% of passengers at London’s airports are hubbing or transferring to another flight going elsewhere.

LEFT: Gatwick has opened new direct routes to emerging markets such as Vietnam.

RIGHT: Passengers want direct connections to and from London.


London Origin & Destination Airport Passengers by Market

(Source: International Air Transport Association PaxIS FY11/12)

(Source: International Air Transport Association PaxIS FY11/12)

London Airport Passengers by Type

Passengers (in millions)

Origin / Destination

Transfer


Heathrow

Gatwick

Stansted

Luton

London City

Southend

16

54

33

1.20

18

0.00

10

0.01

3

0.03

0.05

0.00

Origin/Destination

Transfer

Europe 73


North America 12

Domestic 10

Africa 5

Far East 5

Middle East 3

Indian Sub-continent 3

Australasia 2

Caribbean 1

South & Central America 1

China 1

Europe 73


North America 12

Domestic 10

Africa 5

Far East 5

Middle East 3

Indian Sub-continent 3

Australasia 2

Caribbean 1

South & Central America 1

China 1

6

Some people suggest that a lack of ‘hub capacity’ – which enables airlines to pool demand from a range of destinations – is a barrier to economic growth.

They claim that the lack of direct connections to cities where there is currently limited demand, such as a number in China, is “something that the UK should be worried about5”.

They argue that capacity must be added either at Heathrow, or a brand new ‘mega hub’ built alongside the closure of Heathrow, in order to ensure we can compete with countries like France, Germany and the Netherlands in terms of total number of flights between China and the UK.

This is, at best, overly simplistic. The reason why the UK is not directly connected to a range of smaller cities on the Chinese mainland today – and some other European Countries are – has little to do with runways at the UK’s largest airport being full. It is almost entirely due to the lack of demand to fly to these places from the UK.

The graphic to the right shows just how low that demand is. Today, airlines could choose to fly to some of these cities direct from

London, just as others do from France or Germany where, in some cases, demand is higher. But many do not, because the size of the potential market does not warrant it. Where demand to fly from London to emerging economies exists, it is largely being met.

A substantial proportion of the demand that does exist is being met without the need for more ‘hub capacity’ in London. Many of the UK’s flights to emerging economies have very few ‘transfer passengers’ on board when they take off. For example, less than 5% of passengers flying from Heathrow to Guangzhou today are transferring at the London end6.

Of those passengers that are using Heathrow as a ‘hub’ airport, the vast majority (76%) will fly with British Airways or its One World airline alliance partners, with only 6% of ‘transfers’ accounted for by airlines within either the Star Alliance or the Skyteam alliance7.

Therefore, for many airlines serving London – or planning to – ‘hub capacity’ is not critical to whether they do, or do not, serve direct routes to and from the city.

The reason why the UK is not directly connected to smaller cities in emerging markets is due to the lack of demand.

The evidence does not suggest that London’s connectivity is synonymous with growth at its largest airport, or the construction of a new mega hub.

The hub capacity myth

66 A better solution for London & the UK Connectivity, competition & certainty


Comparative long haul demand to and from London: Top 10 destinations vs China


0 250 500 750 1000 1250 1500 1750 2000 2250 2500 2750 3000

New York (JFK)

Dubai

Hong Kong

Los Angeles

New York (EWR)

Boston

Bangkok

Orlando

Singapore

San Francisco

Beijing

Shanghai

Guangzhou

Chengdu

Xiamen

Fuzhou

Shenyang

Nanjing/Nanking

Chongqing

Wuhan

Dalian

Hangzhou

Qingdao

Changsha

Xi An Xianyang

Kunming

Harbin

Top 10 international destinations

Key:

Passengers per day each way

17 Chinese destinations


At Gatwick, all passengers are important to us – whether flying directly into or from the airport, or transferring through the airport like the two million passengers who do each year. The future needs of both types of passengers must be addressed. Our view is that you don’t need to expand Heathrow or build a new ‘mega hub’ to cater for their needs.

Aviation policy and transport infrastructure decisions have consequences that last for decades. In making such decisions, it is vital to acknowledge tomorrow’s challenges.

In future, passengers will want to fly to new destinations. With the growth of emerging economies, we will see a greater proportion of passenger demand to fly from London to these places.

The way passengers use airports, and how they transfer between flights at them, is changing. Increasingly, passengers are now ‘self-transferring’ from low cost short haul, or charter airlines, and on to separately-owned full service long haul flights. In 2011, nearly 800,000 passengers at Gatwick

were ‘self-transferring’ between separately owned airlines8.

With more than 24 million short haul passengers a year, Gatwick already has the UK’s largest short haul and domestic network. We are connecting passengers to many key destinations in Europe – from Frankfurt to Istanbul – and across the UK regions, including all the main Scottish airports.

Our long haul network is second only to Heathrow serving 38 long haul destinations9. We are starting to join these networks together so that a passenger can take a low cost flight from Edinburgh and transfer seamlessly to a flight to Beijing. Regardless of airline, a passenger will be able to transfer quickly and efficiently from one flight to the next. We are putting in place new infrastructure to handle this process.

Airlines themselves are also working far more closely together, and not just within the traditional ‘alliance’ structure.

How will people connect in the future?

LEFT: Gatwick has the most short haul and domestic destinations of any UK airport and serves many key long haul routes.

RIGHT: Airlines have placed significant orders for Boeing’s long-range 787 Dreamliner.


Airlines plan to serve long haul routes using 787 Dreamliners and A350s

Airline order books show less demand for ‘hubbing’ on ‘trunk routes’

Types and quantity of aircraft on order:

In particular, there has been substantial growth in interline and code-share agreements between low cost airlines and long haul carriers. Around the world, carriers such as WestJet in Canada, JetBlue in the US, Virgin Australia and Jetstar in Australia have already done this with larger ‘network’ carriers operating long haul routes.

In particular, Jetblue has codeshare flights with Lufthansa, Qantas, Japan Airlines and American Airlines, as well as interlining arrangements with 25 other airlines. These arrangements enhance the profitability and reach of the carriers, and enhance the connecting options of passengers. This is not just an emerging trend. It is increasingly a major source of revenue. Etihad Airways, which is not part of any airline alliance, report that 19% of its revenues in 2012 originated from airline partnerships10

This has real implications for future runway infrastructure in the UK. There will always be a need for ‘transfer’ passengers, which represent a small proportion of air

passengers, to support the commercial viability of more marginal routes. But we must be more innovative in how that need is met. We should not base decisions on new runway infrastructure on the way airline business models work today. The trends highlighted above are changing the way the global aviation industry works.

The way passengers use airports in the future will also reflect the nature of the aircraft they fly on. Already airlines, which plan decades ahead when they invest in new aircraft, have signalled they are moving away from supporting the traditional ‘hub and spoke’ model that generates ‘transfer’ passengers. They have placed orders worth billions for Boeing’s long-range 787 Dreamliner and Airbus A350s, more than triple the orders for Airbus’s ‘superjumbo’ A380. Passengers will have access to more direct flights to new destinations that are further afield. London could increasingly be bypassed as a transfer point. As a result, the proportion of ‘transfer’ passengers at its airports could fall even further.

787 Dreamliner800

A350617

A380260 (90 with one airline)

0 800 1600

Airlines plan to serve direct long haul routes. Order books show less demand for ‘hubbing’ on ‘trunk routes’ and more aircraft (787 and A350) are being ordered.

The way passengers use airports is changing. In 2011, nearly 800,000 passengers at Gatwick were ‘self-transferring’ between separately owned airlines.


By the mid 2020s, a step change in London’s airport capacity will be needed.

Although there is spare capacity at London’s airports today, we do not believe it will be sufficient to meet the growth in demand we are likely to see in the next decade or so. Excess capacity elsewhere in the UK will not satisfy it either because the demand from people living in the south east, or wanting to travel to and from it, is so high.

We believe there will be a need for new runways at airports in the south east at some point in the next decade. And we must not leave it too late. If we wait until all of London’s airports are almost full before creating new capacity, we will put the UK at a huge competitive disadvantage.

Our vision is for three competing major London airports, each with two runways. The competition that could follow would lead to better connectivity, better service quality and better value for money for both passengers and airlines.

We also believe that the building of a ‘mega hub’ or an expanded Heathrow could actually be detrimental to the UK and passengers. The market power that has just been reduced through the break-up of BAA would be re-established. Fares would rise, and the incentive to continually improve service that real competition brings would be removed.

We believe that London should follow the model used by other global cities to develop their airport systems. This approach has proved extremely successful. For example, Paris, Frankfurt, Istanbul, New York, Tokyo, Los Angeles, Chicago, Washington DC and many others each have more than one major airport serving their needs. Cities such as Beijing and Shanghai are also pursuing this model. In fact, more than half of world’s 40 busiest cities for air travel have a multiple airport approach and do not have ‘mega hubs’11.

These global cities have the connectivity they need, more passenger choice, better resilience to disruption, and the distribution of economic benefits and environmental impacts across a wider area. Gatwick’s vision has been tried and tested in the world’s global economies.

However, the additional game changer for London is the role of competition. Anyone travelling through Gatwick can see for themselves how the airport has been transformed since BAA sold it in 2009. More than £1 billion of investment has supported our relentless focus on delivering the best service for passengers. Our ambition has been to deliver passenger choice, convenience, outstanding customer service and affordability. And crucially, we are also delivering the new routes that business and leisure travellers tell us they want to use.

Gatwick’s vision

We believe that the best first step in delivering this vision is to build the next runway at Gatwick.• Itwilldeliverthenecessarycapacity

and connectivity for a generation

• Itwillminimiseenvironmentalimpactsof expanded capacity

• Itwillhelpprovidethebestpassengerexperience

• Itwillfostercompetitionamongstairports and airlines

• Itisexpectedtohaveaviablebusinesscase which avoids significant subsidy from the public purse

• ItwillimproveresilienceofLondon’sairports

• Itislikelytobethemostdeliverable of the available options

10 A better solution for London & the UK Connectivity, competition & certainty

bettersolution.gatwickairport.com 11bettersolution.gatwickairport.com 11

Gatwick already operates the busiest and most efficient single runway in the world, offering more destinations than any other UK airport, and providing the most direct rail connections and fastest train travel into London’s West End and financial districts of the capital’s major airports. By the mid 2020s London will need more runway capacity. However, we believe there are opportunities to improve efficiency, connectivity and the passenger experience in the short and medium term.

Key to achieving these aims is to encourage greater competition between London’s airports by encouraging a more flexible approach to pricing, service and quality levels. We believe increasing competition in this way will drive more connectivity and innovation, attracting new airlines and establishing essential new long haul routes.

Gatwick also has a clear focus on the need to improve rail services. Although it already has good rail links, the airport – as well as some of its airlines – believe more dedicated, high quality and value for money services into London are fundamental to encouraging greater use of its capacity. Key to this is better, fit-for-purpose rolling stock

for the Gatwick Express. Gatwick believes this is essential for meeting the specific needs of airport passengers and current airlines, but also for attracting new away-based carriers that consider excellent onward transport links as a key deciding factor of where to fly.

In addition, Gatwick also believes that the level of resilience offered by London’s airport system should be reviewed, especially in light of recent disruptions caused by snow. The London airports, and particularly Heathrow, should ensure they have appropriate levels of flexibility in their slot utilisation to ensure they can recover quickly from disruption; giving certainty to passengers that the UK can remain consistently well connected and served.

While Gatwick operates an efficient service on the airfield, other short and medium- term options include the better use of local air space, runway slots and the airport’s night flight quota. Gatwick believes local airspace can be better utilised to create a more reliable end-to-end service for passengers.

What would help maximise connectivity in the short term?

Summary of short-medium term measures:• Supportforthedeliveryofenhancedrail

and road infrastructure for Gatwick airport, including the provision of new rolling stock for the Gatwick Express

• Thepromotionofcompetitionasawayof incentivising the best use of existing runway capacity, and of encouraging new developments

• Defineanacceptablelevelofcapacityutilisation for major UK airports, with a view to improved resilience

• UrgetheUKGovernmenttosupporttheEuropean Parliament’s first reading position during inter-institutional negotiations on the EU Airports Package and to implement the final agreed regulation as soon as possible thereafter

• Recommendasystematicreviewofremaining bilateral restrictions with a view to reducing or eliminating restrictions

• Theretentionoftheexistingnightnoiselimits at Gatwick


London Gatwick’s future role: our emerging view

London Gatwick has laid out what it believes should be the key criteria that plans for any new runway in the south east should be judged upon.

Gatwick’s runway options work, which uses the Airports Commission sifting criteria for runway expansion and our own assessment criteria, will form the basis of our initial proposals.

We believe that the best option for the Airports Commission is to recommend adding a second runway at Gatwick in the mid-2020s, followed by another runway, possibly at Stansted, when the need arises.

Enabling Gatwick to grow would solve the connectivity issue for a generation.

We have identified eight key tests to help the Airports Commission assess the best options for new capacity around London. These are shown on the left in the table on the following pages. On the right, we have shown how Gatwick is already demonstrating it is the best fit against these criteria.

LEFT: Gatwick is connecting passengers to the economies which matter the most.

RIGHT: Any airport expansion must be balanced with the environmental considerations.


Gatwick’s assessment criteria

Understanding and minimising the environmental impacts of aviation on local communities, particularly noise and air quality, is key. The role of aviation and airport expansion on climate change also needs to be considered.

• Theevidenceshowsthattheresimplyisn’ttheneedfora‘megahub’ in London.

• Only13%ofpassengersusingLondon’sairportstodayare‘hubbing’ or transferring on the same ticket to another flight elsewhere.

• ThevastmajorityofpassengerswanttoflytoandfromLondon–notthrough it. As such, London should be seen as the hub for UK air travel – not one single airport.

• Transferor‘hub’trafficwillremainimportantforsomeroutes–buthowpassengers connect in the future will change. Evidence from around the world shows a growth in partnerships between low cost airlines and long haul carriers as an alternative to the traditional network carrier model.

• Gatwickhasalreadydemonstratedthatitcanprovideconnectionsto the economies that matter with new direct routes to half of the most important growth markets in the world12.

• Withmorecapacity,wecanopenmoreroutestomoredestinations. A second runway at Gatwick could enable London to meet demand until at least 2050.

• Ourvisionofthreemajorairportseachwithtworunwayswouldspreadtheenvironmental impacts of maintaining and growing the UK’s connectivity to the world across the south east.

• Runwayexpansion,whereverithappens,willhavebothlocalandnationalenvironmental impacts including noise, air quality and carbon dioxide emissions. Gatwick will be very sensitive to local environmental concerns, and if a second runway is recommended by the Commission, we will look to use the best practices available to mitigate the adverse impacts of additional aircraft.

• Thenumberofpeopleaffectedbyanewrunwaywouldbeverysignificantly lower at Gatwick than at Heathrow.

• TheenvironmentalimpactofathirdHeathrowrunway,letaloneafourth,would be huge. Already, 243,000 people are adversely affected by noise from Heathrow13. The Department for Transport has highlighted how Heathrow’s noise ‘footprint’ is currently larger than all other major western European airports combined14. This can only increase if Heathrow expands with additional runway capacity.

• GatwickAirporthasneverbreachednitrogendioxidelimitsand,basedonprevious studies, would not expect to do so with the addition of a second runway.

• HeathrowAirportregularlybreachestheEuropeanlimitfornitrogendioxide at monitoring sites around the airport. A third runway at Heathrow would mean that 35,000 people would be exposed to levels above legal limits15.

Demand Capacity and Connectivity

Environmental impact

It is critical that we keep London and the UK connected to the rest of the world by providing capacity in time to meet the needs of air passengers. It is vital therefore that the Commission fully assesses what that level of demand is in the UK, and for the south east in particular, and how each option can satisfy that demand.



Part of the rationale behind the break-up of the BAA monopoly was to improve the passenger experience. The role of competition between independently owned airports is therefore a new factor to be assessed by the Commission. An assessment should be made on the effects on airport and airline competition on each expansion option and the implications of that on passengers with regard to air fares, quality of service and passenger experience.

• Often,customerspaymoretomonopolyserviceprovidersthantocompetitors. It is no different for airports. Already, we know that dominant hub airports result in higher air fares, especially in the absence of effective competition from other airports17.

• Gatwick’svisioncouldproviderealscopefortrueairportcompetitionto take root, which will encourage fares to fall and services to improve everywhere.

Competition

Passengers should be central to this debate. All options should be assessed against whether they offer passengers the greatest convenience and choice as they travel to and through an airport.

• Webelievepassengersgreatlyvaluetheabilitytohaveachoiceofairport – whether for the connections provided, the quality of services or having the convenience of using an airport near home or the office (minimising travel times). A single mega hub (whether in the Estuary or at Heathrow) would remove choice from the end-to-end passenger experience and force a ‘one mega-size’ fits all approach.

• AtrulycompetitivenetworkofLondonairportswillcreateevengreaterincentives for airports to provide the travel experience that passengers expect and the Competition Commission envisioned in 2009. Put simply, if the experience is not good enough, passengers and airlines will ‘vote with their feet’16. In a competitive world, airports will do their utmost to provide the very best experience for passengers.

End-to-end passenger experience

LEFT TO RIGHT: Passengers want choice and convenience - from transport links and dedicated services suiting their needs, to shops and food outlets.


The business case for any expansion option is critical and options should be assessed against the part they can play in providing economic growth – locally and nationally. The ability to finance any expansion option should also be a key assessment criteria with a focus on using private investments to avoid significant subsidy from the public purse.

• Wearebackedbyagroupofexperiencedshareholdersandinitialestimates indicate that a new runway and airport facilities at Gatwick could be funded privately. We would also share with the Government a proportion of the cost of improved rail and road infrastructure.

Financial and economic factors

Airports have significant impacts on local communities – positive and negative – and these should be taken into account. The social benefits of air travel should be maximised, whilst minimising the impacts on people and communities.

• Ourvisionofthreemajorairportseachwithtworunwayswouldspreadthe economic and social benefits, as well as any negative impacts, of airport expansion across the south east rather than concentrating it in one location.

• Amegahubrunstheriskofconcentratingalltheassociatedeconomiesof an airport in one area, so would have negative impacts on existing businesses and communities surrounding London’s airports.

Social and community issues

Any expansion option should include an assessment of resilience, including how extreme weather scenarios would be accommodated in the expansion options proposed.

• Concentratingnewcapacityinoneplaceisarecipeformoretraveldisruption.

• Gatwick’svisionwould,bydistributingnewrunwaycapacityarounddifferent locations, result in less scope for disruption caused by, for example, severe weather than if new capacity was concentrated in one place.

• ThesituationwherehundredsofflightsarecancelledatHeathrowpremptively could, under Gatwick’s vision, be avoided in future.

Resilience


The issue of deliverability is important given the timetable that has been set for the Commission and the fact that the three major airports in the south east will be full by the mid-2020s. It is vital that expansion options are assessed against how quickly and efficiently they can be delivered through the planning and construction phases.

• GatwickisalreadythebestconnectedairportbyrailintheUK,andconnected to a major motorway.

• MuchofthesupportinginfrastructureatGatwickneededtoensurepassengers can access new runway capacity is in place or supported by existing Government spending plans. Delivering Gatwick’s vision would not require the movement of, or tunnelling under any motorways, the reclaiming of any land from the sea, or the construction of any extension to the London Underground network.

• LandhasalreadybeensetasideforanewrunwayatGatwickinaccordance with Government policy18.

• Ineverysense,asecondrunwayatGatwickcouldbenotjustaffordableand sustainable, but deliverable as well. A decision to support expansion at Heathrow would just result in more years of delay.

Deliverability


LEFT: Committed to getting passengers away on time.

BELOW: Land set aside for a new runway at Gatwick.

To learn more about London Gatwick and its vision please visit bettersolution.gatwickairport.com On the site you’ll find further details on:

•AlloursubmissionstotheAirportsCommission

•Informationontheairport,itshistoryandfutureplans

•Howwearecompetingforpassengers

•Howpassengerstravel

•Whereweconnectto

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1 Airports Council International (ACI) & IATA PaxIS Database.

2 Department for Transport’s Draft Aviation Policy Framework.

3 Civil Aviation Authority and Dft Passenger Forecasts (January 2013).

4 International Air Transport Association Passenger Intelligence Service (PaxlS).

5 Heathrow Airport, One hub or no hub (November 2012).

6 Between September 2011-2012. This figure includes a small % of passengers transferring at both ends of the flight. International Air Transport Association (IATA) PaxIS Database and OAG Schedule data over the period.

7 DIIO FMg Database.

8 York Aviation, London Assembly Transport Committee: Technical Advice and Support for Investigation into Airport Capacity (April 2012).

9 OAG Schedule based on peak week in August 2013.

10 http://centreforaviation.com/analysis/japan-airlines-and-jetstar-japan-embrace-lcc-hybridity-codesharing---and-reap-rewards-99499.

11 Airports Council International (ACI).

12 As identified in Goldman Sachs Asset Management, It is time to re-define Emerging Markets, (January 2011).

13 Defined by number of people living within Heathrow’s 57 Db Leq Noise contour and shown in CAA, ERCD Report 1201, Noise Exposure Contours for Heathrow Air 2011(September 2012).

14 Department for Transport, Draft Aviation Policy Framework (July 2012) refers to Frankfurt, Paris CDG, Amsterdam Schipol and Madrid.

15 Department for Transport, The Future Development of Air Transport in the United Kingdom: South East (February 2003).

16 Gatwick Airport, Airport Competition: Competing to Grow and become London’s airport of choice, (November 2011).

17 I. Kincaid and M. Tretheway, “The Effect of Market Structure on Airline Prices: A Review of Empirical Results: Journal of Air Law and Commerce, Volume 70, Issue 3, Summer 2005.

18 Department for Transport, Aviation Policy Framework, (March 2013).

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