Heathrow “best placed”

heathrow freight planesExpanding Heathrow is the quickest way for Britain to solve its aviation capacity issues, connecting the UK to growing markets around the world faster and at less cost to the taxpayer than any other hub option, according to a new report.

The new research, published by Heathrow Airport, suggests replacing Heathrow with a new hub airport would leave passengers, taxpayers, and business worse off, and that Heathrow is better located for passengers, business and jobs than a new hub airport at Stansted or in the Thames Estuary.

The new report, entitled “Best placed for Britain”, has been compiled by Heathrow Airport with architectural and planning consultants AECOM and Quod, and was commissioned as part of Heathrow’s evidence to present to the Airports Commission under Sir Howard Davies.

Under a series of headings, the report says that compared to a new hub airport option, Heathrow is best for passengers, business & economy, taxpayers, local jobs, and speed of delivery.

The report argues that building a new hub airport to the east of London would increase travel times for 90% of hub passengers.  Even if a new hub airport came with a major investment in new transport infrastructure, Heathrow would still have 4 million more people within 60 minutes travel time.  It says the economic cost of longer journeys to a new hub could be £26bn net present value – the equivalent to the benefits of reduced journey time delivered by High Speed 2.

It says that the area around Heathrow is home to some of the world’s most highly productive business clusters in industries like IT and pharmaceuticals, with 202 of the UK’s top 300 company HQs in close proximity to Heathrow.  The area has 60% more international businesses, twice as many US businesses, and three and a half times as many Japanese businesses than the national average. It is likely that these businesses are based in the UK because of Heathrow, and that moving the UK hub could see them move to Frankfurt, Paris, Madrid, or elsewhere, rather than wait for a new UK hub to be built.

If a new hub were built other than at Heathrow, the 76,600 people directly employed at Heathrow would face re-location or redundancy. This, says the report, would be the largest single group of direct job losses in the UK. Greater than the 30,000 jobs lost in 1984, the worst year of pit closures. While some of the people would move to the new airport location, the local impact of the lost GVA would be massive. Heathrow is estimated to be around the size of Manchester, economically speaking. Taking that out of the West London economy would reduce prosperity significantly.

The report also says additional capacity at Heathrow could be delivered around 8 years faster than any new hub airport could be built, and that delay in building new capacity is critical. Heathrow has argued that the UK is losing some £14bn a year in trade and export earnings due to constraints in aviation hub capacity. Many feel that the Davies Review timetable is too long anyway, and that further delay on a decision on new runway capacity would damage UK Plc irreparably.

Expanding Heathrow should be cheaper too, Heathrow say.  The report calculates for the first time that £20-£25bn of sunk rail infrastructure cost has been committed around Heathrow since the 1970s. Any new hub would need to build vast new infrastructure from scratch using public money.  Mayor of London Boris Johnson estimates that a new hub airport would cost in the region of £70-80 billion of which £25 billion would require public subsidy.

London First, one of the key representative organisations for businesses in London, agree. John Dickie, Director of Strategy and Policy at London First, said: “Heathrow is a critical national asset and a magnet for valuable and long-standing clusters of local jobs and businesses. The Airports Commission will rightly explore all options, but this report is yet another challenge to the idea that we should close Heathrow and build a new hub. It is further evidence that the most practicable solution to our long term aviation needs is to add new capacity at our existing airports.”

Colin Matthews, CEO of Heathrow, said: “Britain already has one of the world’s most successful international hub airports in Heathrow. Expanding Heathrow will put Britain ahead in the global race, connecting UK business to growth more quickly and at less cost to the taxpayer than any other option for new capacity.  Heathrow is better located for passengers, business and jobs. Why build from scratch at a new hub when we can build on the strength that already exists around Heathrow today?”

Download the Heathrow report here.

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