CAPACITY FOR GROWTH M.A.G's submission to the Airports Commission - July 2013 - Strategic Aviation Special Interest Group
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CAPACITY FOR GROWTH M.A.G’s submission to the Airports Commission July 2013
Maximum use of the single runway............................................................. 21
3. Stansted: future development options ......................................................... 23
Phase 1 information requirements .............................................................. 23
Table of Contents ............................................................................................... 2
Our approach to identifying options ........................................................... 23
Executive summary .............................................................................................. 3 Single-runway maximum use ..................................................................... 24
M.A.G’s submission on long term capacity options ........................................ 3 One additional runway to the north west .................................................... 25
The UK needs a clear plan of action ............................................................ 3 One additional runway to the east ............................................................. 26
The importance of taking a national perspective ............................................ 3 A hub airport with four runways ................................................................. 27
The need for a flexible approach to providing new capacity ............................ 3 4. Stansted options assessment ...................................................................... 28
M.A.G’s vision for Stansted ......................................................................... 4 Strategic fit .............................................................................................. 28
Stansted can meet demand in the short term ................................................. 4 Economy ................................................................................................. 30
The benefits of expanding Stansted .............................................................. 5 Surface access ......................................................................................... 33
Stansted: options for an additional runway.................................................... 6 Environment ............................................................................................ 36
Stansted: an option for an effective hub ........................................................ 6 People .................................................................................................... 44
Summary of Stansted options ...................................................................... 7 Cost ....................................................................................................... 47
Manchester Airport: flexible and deliverable plans for new capacity ................. 7 Operational viability ................................................................................. 49
Capacity for growth.................................................................................... 8 Delivery .................................................................................................. 50
Structure of M.A.G’s response .............................................................................. 9 5. Manchester: potential of current runways .................................................... 51
1. Introduction ............................................................................................. 10 Introduction ............................................................................................. 51
About M.A.G and our submission .............................................................. 10 Manchester Airport today .......................................................................... 51
The Airports Commission process .............................................................. 10 Strategic Context for Manchester Airport ..................................................... 52
M.A.G’s previous submissions to the Commission ....................................... 11 Long term plans for Manchester Airport ...................................................... 53
Our approach to developing long term options ........................................... 13 Evaluation of the plan against the Commission’s criteria ............................... 54
Information on long term capacity at Manchester Airport .............................. 14 Conclusions ............................................................................................ 56
Stakeholder engagement .......................................................................... 15 6. Next Steps ............................................................................................... 58
2. Stansted: the single-runway airport............................................................. 16 Appendix 1 – Appraisal Summary Tables ............................................................. 60
Stansted airport today............................................................................... 16 Appendix 2 – Economic impacts of Stansted long term options ............................... 65
Current airport layout ............................................................................... 19
July 2013 M.A.G - Capacity for Growth 2
The importance of taking a national perspective
The Department for Transport (DfT) expects runway capacity in the South East to be
M.A.G’s submission on long term capacity options fully utilised by 2030, and UK-wide passenger numbers to increase from 219 million
today to 445 million by 2050.1 Given these parameters the natural focus for the
The Manchester Airports Group (M.A.G) owns and operates four airports in the UK
Commission’s work will be on addressing the need for further runway capacity in the
(Manchester, London Stansted, East Midlands and Bournemouth) and together it
South East. However, it is important that the Commission takes a national perspective
handles 42 million passengers per annum (mppa).
on these issues, and takes account of the significant contribution that airports outside
As an airport operator with interests in both London and in the UK’s regions, M.A.G the South East make to providing international connectivity from their own regions.
offers a balanced perspective on the issues being addressed by the Airports
By this, we don’t mean the Commission should be considering measures to divert
Commission. We are committed to helping the Commission with its work so that its
demand away from the South East to the regions; such action would be ineffective and
recommendations to the Government are based on robust evidence and analysis.
damaging to the UK’s interests. Instead, the Commission should identify the steps that
This document is M.A.G’s submission to the Airports Commission on long term would support airports across the UK to meet demand as much as possible from their
capacity options. The document sets out a range of flexible options to support growth region. Not only would this have benefits for individual regions by providing them with
in demand over the coming decades. greater international connectivity, it would also help the South East by freeing-up
capacity at London to be used to meet more of the region’s own demand.
The UK needs a clear plan of action
All of M.A.G’s airports have an important role to play in delivering capacity for growth.
The Government has established the Airports Commission to provide it with
Manchester has a strategic role as the major gateway to Northern Britain, providing
independent advice on the steps needed for the UK to maintain its position as Europe’s
world-wide connectivity to this region. With two runways, it has the ability to meet
most important aviation hub.
demand over the long term. East Midlands and Bournemouth airports have a smaller
The Government’s reasons for seeking advice from the Commission are clear: aviation but nevertheless important role to play, in meeting demand from their own regions.
has an important role to play in ensuring the UK has good international connectivity to
support economic growth. The UK’s future prosperity depends on the success of UK The need for a flexible approach to providing new capacity
businesses competing across national boundaries, and these companies depend on The Commission is considering the nature of any additional airport capacity that might
the international connectivity that air travel provides. be required in the future. Its recent discussion paper explored the question of whether
an operating model dominated by a ‘focal’ airport should be preferred over a model
Governments across Europe and the rest of the world have established clear plans for
that disperses the development of capacity more widely across a range of airports.
the development of their airports and then moved forward to deliver new runway
These issues need to be looked at from the perspective of airlines, and a clear
capacity. The UK’s lack of progress in addressing these same issues has created an
understanding of the way they will serve passenger needs in the long term.
urgent need for the Commission to recommend a clear way ahead for the next
Government. In a world where the aviation industry could develop in a number of different ways over
the long term, developing new capacity in a dispersed way is likely to have many
The Government’s aspiration is that the Commission’s recommendations will enable
benefits, including the ability of airports to deliver capacity incrementally. This would
real progress to be made this time around. For this reason, it is vital that the
enable new facilities to be designed in a cost-effective way to meet evolving needs. A
Commission puts forward long term recommendations that are deliverable and flexible
enough to respond to changing circumstances over the long term.
1
DfT Aviation Forecasts, January 2013
July 2013 M.A.G - Capacity for Growth 3
dispersed development of capacity is also likely to be more deliverable and flights a year, and the best on-time performance of any major airport in the UK with
financeable, and less likely to need taxpayer support. 82% of flights departing on time in 2012. Under M.A.G’s ownership, we are confident
that we can build on these strengths by improving the passenger experience and
The dispersed model has the greatest potential to strengthen airport competition, as
attracting new airlines and passengers to Stansted, and quickly put the airport back on
well as competition between airlines. This issue is particularly relevant given the
a path to growth.
Competition Commission’s recent forced sale of Gatwick and Stansted, both of whom
have the potential to deliver new capacity in a dispersed model. Our vision is to make Stansted the best airport in London by improving customer
service and delivering value to airlines, supported by investment of around £230
Whilst 87% of UK passengers are flying point-to-point2, rather than connecting to other
million over the next five years. We are looking to succeed by competing more
flights, there are undoubtedly merits in creating an effective hub. However, it will be
vigorously against other airports in London and across the UK and Europe. However,
important for the Commission to give early consideration to the potential issues
we recognise that we will face strong competition from other airports, including
associated with a hub, including:
Gatwick, which has been under new ownership since 2009.
the fact that Heathrow would need to close as a prerequisite for a new hub to
Although we only acquired Stansted a short time ago, we have made excellent
be delivered elsewhere;
progress in implementing our strategy for transforming and revitalising the airport. For
the need to test the commercial viability of such a scheme within the current
example, we recently announced an £80 million investment in the transformation of
market;
the terminal building to provide passengers with a better experience. In June, we
the Government’s appetite for funding the road and rail schemes needed to
announced that we had agreed a long term deal with easyJet to enable them to
support the development of a new hub; and
double their passenger numbers at Stansted from 2.8 million to 6 million a year over
the risk that a ‘hub’ model could commit the UK to a rigid aviation strategy
the next five years.
which is not ‘future proof’.
The issue of operating models should not be considered by the Commission in Stansted can meet demand in the short term
isolation. Our view is that it would be appropriate for the Commission to take forward The maximum use capacity of Stansted's single runway will be between 40 and 45
a range of options representing different ways of providing airport capacity, including mppa. Based on current throughput of around 17 mppa, this means Stansted has the
options at Stansted. This would allow the Commission’s assessment of operating potential to serve around 25 million more passengers every year than it does now,
models to be taken into account as one part of its overall assessment of shortlisted equivalent to nearly one-fifth of all passengers using London’s airports in 2012. This
options. means Stansted's spare capacity will play an important role in meeting demand for air
travel from London and the South East over the next ten to fifteen years, as other
M.A.G’s vision for Stansted airports experience increasingly severe capacity constraints.
M.A.G completed its acquisition of Stansted in February 2013. Our view is that
Stansted offers much needed short and medium term capacity and the potential to
Stansted has significant scope to compete more successfully with Heathrow and
improve UK connectivity to growing and emerging markets. As the airport grows, the
Gatwick, and by doing so it will play a much fuller role in meeting demand for travel in
range of services available will increase both in terms of the mix of destinations and the
London and the South East.
types of airlines. In particular, Stansted will begin to serve a much greater share of the
Stansted is a superb airport with high quality assets, capable of accommodating all demand that originates in its catchment.
types of airlines. It has enough spare capacity to accommodate an extra 130,000
Growth will largely be achieved by making more intensive use of the existing
infrastructure, and only limited further investment is likely to be required to support the
2
Source: International Air Transport Association Pax IS FY11/12
July 2013 M.A.G - Capacity for Growth 4
airport’s growth to its maximum use. Importantly, Stansted already has the necessary These scenarios are illustrative of a wide range of options, but they provide a basis for
planning consents and most of the infrastructure needed to grow to 35 mppa. Beyond assessment against the Commission’s criteria. The Airports Commission will need to
35 mppa, we are confident that growth to maximum use of the single runway could be establish the relative merits and impacts of each option for expansion. At Stansted,
achieved within existing environmental limits, including the existing noise cap. expansion provides many potential benefits to both passengers and the UK economy:
There is a strong case for the Government to prioritise investment in the rail network
Unique flexibility to meet UK capacity needs
serving Stansted and the wider region. Reducing the rail journey time to Central
Stansted can meet the UK’s air capacity needs in the short, medium and long
London to below 30 minutes would provide passengers with greater choice and
term. This flexibility enables Stansted to deliver incremental runway capacity
encourage more airlines to start services from Stansted. Recent studies found that
to support the UK’s evolving economic and aviation needs.
improving the line could unlock wider benefits for the UK economy of over £4.5 billion
by 2021.3 In addition to these benefits, rail improvements would also support Stansted Wide economic benefits
in making the most effective use of its spare capacity. New runway capacity at Stansted could generate up to £15 billion per
annum extra in direct Gross Value Added (GVA) benefits. The airport will play
Under new ownership, M.A.G will revitalise Stansted and put the airport in a position
a key role in supporting London’s economic development, both to the east
to make a more effective contribution to meeting demand in London and the South
and along the London-Stansted-Cambridge Growth Corridor. Of particular
East. The Government can support Stansted in achieving this by taking the lead in
relevance is the contribution that Stansted will make to the growth of
improving rail journey times. The economic benefits would be substantial given the
strategically important sectors based in Cambridge, the City of London,
importance of making the most effective use of the capacity that already exists over the
Canary Wharf, Tech City, Harlow and Alconbury Enterprise Zones. The
next 10 to 15 years.
Greater Cambridge area alone accounts for 1,500 technology companies
On this basis we believe there is a strong case for the Commission to recommend to employing 53,000 people, with an annual turnover of nearly £12 billion.
Government that maximum use of Stansted should be supported by future the
Affordability for Government and Passengers
Government policy given its contribution to meeting the Government’s objective of
Stansted is a cost-effective option for capacity expansion. Investing tens of
maintaining the UK’s status as Europe’s most important aviation hub.
billions in the development of another runway at Heathrow or an Estuary hub
The benefits of expanding Stansted will drive up the cost to passengers of using airports over the long term, to
levels significantly above those at Heathrow today. Immediate capacity can
At this stage, M.A.G is not advocating any single solution at Stansted. Rather, we
be realised at Stansted without the need for major infrastructure investment.
believe that Stansted’s flexibility is such that it could deliver a range of solutions, from
In the longer term, substantial new capacity can be delivered at between
one additional runway to effective hub capacity. In that context, we have sought to
£2.5-£4.0 billion for an additional runway and up to £10 billion for an
meet the Commission’s requirements to show ways in which additional capacity may
effective hub. This will have long term benefits for passengers in terms of
be provided. Given the inherent flexibility of Stansted as a location, we have assessed
lower charges, and for taxpayers in terms of the support required from
three main development scenarios:
Government.
maximum use of the existing single runway;
Lower noise impacts
the development of one new runway; and
Stansted’s location means the impacts on people from capacity expansion
the development of an effective hub.
would be substantially lower than at alternative sites. Currently, for every
person affected by aircraft noise around Stansted, around 200 people are
3
London Borough of Enfield-Oxford Economics study, January 2012 affected around Heathrow.
July 2013 M.A.G - Capacity for Growth 5
Stansted: options for an additional runway committed to taking a comprehensive approach to mitigating the adverse effects of
Stansted offers a range of potential options for the development of one additional growth and engaging with local communities to understand these concerns.
runway. These options have been looked at before and we have drawn on that On this basis, we believe there is a strong case for the Commission to include the
material to inform our assessment of the options. option of one new runway at Stansted on its shortlist. Further work will need to be
A new runway could be located either to the east or the north west of the existing carried out at the next stage of the Commission’s process to evaluate which of the
runway. Depending on the specific layout, two runways would provide capacity for potential Stansted options for one new runway should be developed in detail to enable
between 70 mppa and 90 mppa. The on-airport cost of such development would be subsequent evaluation and comparison with other options.
£2.5-£4.0 billion.
Stansted: an option for an effective hub
The additional land-take associated with these options would be between 150 and The UK does not currently have an effective hub airport, where operations and
550 hectares, depending on the configuration and capacity of the runways in question. infrastructure combine to provide flexibility and connectivity to passengers. The
The number of residential properties that would be required to enable development of consensus is that an effective hub airport needs to have four runways to provide
the options would be between 80 and 200. operational resilience and the opportunity to coordinate waves of flights.
The Government concluded in the 2003 Air Transport White Paper (ATWP)4 that a key Three new runways would need to be constructed at Stansted to provide the necessary
advantage of a new runway at Stansted would be that substantial additional capacity level of capacity and resilience for the long term. Two of the new runways would be
would be achieved with a lower noise impact, in terms of the people living within the located to the east of the current runway, and the third would be located to the north
57dBA noise contour, than for comparable options at other airports. Our assessment west. This layout would provide capacity of at least 140 mppa. Options with greater
of the options at Stansted for one additional runway confirms that conclusion. For spacing between the runways to the east would potentially provide capacity up to 160
example, fewer than 7,000 people would live within the 57dBA noise contour in both mppa. The on-airport cost of such development would be around £10 billion.
runway options.
The additional land take associated with a hub option would be between 1150 and
Our review of the surface access requirements for one new runway suggests that 1550 hectares, depending on the configuration and capacity of the option being
infrastructure improvements to the West Anglia Main Line would be needed to serve considered. We estimate that the 240-400 residential properties would be required to
the higher level of passenger throughput. We have also identified a number of develop the four-runway layout.
improvements to the road network serving Stansted that would be needed to support
an additional runway. Although it is possible to estimate the overall cost of these Our assessment of the noise impacts of a Stansted hub suggests that fewer than
schemes, any contribution from the airport would need to be assessed when the 14,000 people would live within the 57dBA noise contour of the four-runway airport.
relative beneficiaries and potential sources of funding are clear. The noise impact of increasing the separation between the runways to the east would
need to be the subject of a separate evaluation.
The option of an additional runway at Stansted would have significant economic
advantages – up to around £3 billion per annum extra in direct GVA benefits and it At this level of capacity, Stansted would clearly be a very different airport from that
would provide strong support to strategically important sectors of the UK economy. At which it is today, and significantly larger than the current operation at Heathrow. Such
the same time, the options for an additional runway at Stansted would have a lower development would make Stansted the largest airport in Europe, providing London with
environmental impact when compared with options at other locations. M.A.G is firmly worldwide connectivity and generating significant employment in the region. The local
and regional impact of this scale of development will need to be carefully assessed,
along with the impact of closing Heathrow.
4
ATWP 2003 §11.30
July 2013 M.A.G - Capacity for Growth 6
A new high-speed rail link would need to be developed to provide convenient access Table 1: Summary of Stansted Maximum Use and Development Scenarios5
from central London. Enhancements to the existing rail network would also be needed Maximum Options for an additional runway
to increase its capacity. Major enhancements would also need to be undertaken on Hub option
use north west east
the strategic road network around Stansted to accommodate the increase in road
traffic. Max Capacity 40-45mppa 70-80mppa 80-90mppa 140-160mppa
Although there would be important issues to address, the development of a hub would Capital Cost minimal £2.5-3.5bn £3.5-4.0bn c.£8.5-9.5bn
also have significant economic benefits. However, a prerequisite for taking forward any GVA (per annum) c.£1.5bn c.£3bn c.£3bn £5-15bn
proposals for a new hub would be the closure of Heathrow, the impact of which could
Population within 57dBA c.2,700
Capacity for growth
Stansted and Manchester both have capacity available today to meet future demands
for air travel. This capacity will accommodate substantial growth in the period before
any new runway capacity can be delivered in the South East. As the operator of these
airports, we will ensure that the most effective use is made of this capacity. M.A.G airports provide
However, achieving this will require the Government and other parties to step forward capacity for growth:
and play their part. In particular, the Government has a key role to play coordinating
major investment in rail improvements. Reducing journey times between Stansted and Stansted is the only airport that has the ability to
London would provide strong encouragement to airlines to start new services, and meet demand over the short, medium and long
create more choice for passengers. The Government should also take urgent steps to term in a way that is flexible, affordable and
reform the structure of Air Passenger Duty to provide airlines with stronger incentives to deliverable.
start operating new routes, particularly to long haul destinations, and thereby
strengthening the UK’s international connectivity. Developing capacity in a dispersed way at a
number of airports, such as Stansted and
In the long term, Stansted offers a range of flexible, affordable and deliverable long
Manchester, would meet the Government’s
term options for new runway capacity. Stansted’s options are viable and competitive
on cost grounds, and the airport’s location means that new runways would have
objective of retaining the UK’s status as Europe’s
significantly lower environmental impacts when compared to other potential runway
most important aviation hub.
schemes. Stansted is an affordable option for a new hub if
As well as options for one new runway and the development of an effective hub, there the Government is prepared to consider the
is also an option to develop new runway capacity at Stansted in a number of steps to closure of Heathrow and provide a package of
meet long term demand. This approach would potentially be more affordable than support to enable the development of the airport
developing a new hub in one single step. No other location offers this kind of flexibility. to be privately funded.
M.A.G airports offer unique capacity for growth from the short-term through to the
long term. We would encourage the Commission to take these options forward to the
next stage of this process, so that they may be evaluated in detail against other long
term options.
July 2013 M.A.G - Capacity for Growth 8
M.A.G’s response on long term options is structured as follows: Section 1 – Introduction: provides a brief overview of M.A.G and our participation in the Airports Commission process to date. It explains our approach to developing long term options, including growth at Manchester, where new runway capacity is not envisaged. The introduction also includes our approach to stakeholder engagement during Phase 1 of the Commission’s process. Section 2 – Stansted: the single-runway the airport: puts Stansted in its current, historical and geographical context. It outlines the contribution Stansted makes to the East of England region, its layout, surface access and its passenger handling potential. Section 3 – Stansted: future development options: provides a high level overview of the different capacity options that Stansted could deliver. These range from maximum use of Stansted’s existing runway, to one additional runway through to the possibility of developing a new hub. Section 4 – Stansted options assessment sets out the implications of each of the options identified in more detail. It examines the performance of each of the options in terms of the Commission’s sift criteria. Section 5 – Manchester: potential of a current runway explores Manchester Airport’s unique role as an airport of national strategic significance, and outlines how the airport’s capacity will grow over time to 55 mppa. Section 6 – Next steps: sets out our perspective on the next stage in the Commission’s process. Appendix 1 – Appraisal summary tables for Stansted long term options Appendix 2 – Economic impacts of Stansted long term options July 2013 M.A.G - Capacity for Growth 9
1.6. Bournemouth Airport provides direct connections for its region to more than 35
destinations. M.A.G invested £50 million between 2008 and 2011 to
transform the airport, providing new terminal buildings and increasing its
capacity to three mppa.
About M.A.G and our submission 1.7. M.A.G’s airports are vital for the social and economic prosperity of the regions
1.1. The Manchester Airports Group (M.A.G) owns and operates four airports in the that they serve. We recognise that the future success of our business depends
UK (Manchester, London Stansted, East Midlands and Bournemouth) and upon our ability to strike the right balance between the economic, social and
together it handles 42 million passengers per annum (mppa). As an airport environmental impacts of our airports. Our philosophy is to be an integral part
operator with interests in both London and in the UK regions, M.A.G is well of the regions that we serve, and to act in a socially responsible manner in all
placed to offer a broad perspective on the contribution that both London and that we do.
regional airports can make to delivering additional capacity for the UK.
1.8. M.A.G is committed to supporting the Airports Commission in providing advice
1.2. M.A.G is privately managed on behalf of its shareholders Industry Funds to the Government on how the need for additional airport capacity should be
Management (IFM), Manchester City Council and the nine other Greater met. We will assist the Commission with its programme of work as required
Manchester Councils. IFM is a global asset manager dedicated to through to the publication of its final report in 2015.
infrastructure equity investments, with more than £9 billion currently invested in
1.9. The purpose of this submission is to provide the Commission with information
such assets. IFM has a strong track record of investing in airports, railway
about the long term opportunities for new capacity at Stansted and
stations, ports and other infrastructure assets.
Manchester.
1.3. Manchester Airport is the international gateway to the North of England,
handling 20 mppa flying on 60 airlines that serve around 200 destinations. It is The Airports Commission process
the UK's largest airport outside the South East and offers a network that 1.10. In launching the Airports Commission in September 2012, the Secretary of
includes daily services to seven destinations in the US, seven daily services to State for Transport Patrick McLoughlin MP made clear that it was the
the Middle East and daily services to Pakistan and Singapore. The airport’s Government’s view that maintaining the UK’s status as a leading global
traffic base includes a wider range of full-service network carriers than any UK aviation hub would be fundamental to the country’s long term international
airport other than Heathrow. competitiveness. The Secretary of State recognised that previous Governments
had failed to develop a credible long term aviation policy to meet the UK’s
1.4. Stansted is the third busiest airport in London by passenger numbers and the
needs for international connectivity.
fourth busiest in the UK, currently handling around 17.5 mppa. The airport is
located to the north east of London, and has good road and rail connections to 1.11. To address this situation, the Government asked Sir Howard Davies to chair an
the wider London and South East market – the world’s busiest aviation market. independent commission to identify and recommend options for maintaining
The airport serves more destinations in Europe than any other airport in the the UK’s status as an international hub for aviation. In February 2013, the
world. M.A.G acquired Stansted in February 2013. Commission issued Guidance Document 016 (GD01). It outlined the
1.5. East Midlands Airport serves over four million passengers annually and has
direct flights to more than 90 destinations. It is the busiest airport in the UK for
dedicated freight operations and is the UK air hub for the Royal Mail and DHL, 6
Airports Commission Guidance Document GD01: Submitting evidence and
in addition to firms such as TNT and UPS. proposals to the Airports Commission (Feb 2013)
July 2013 M.A.G - Capacity for Growth 10Commission’s intended process up to the publication of an Interim Report in Best Use
December 2013. 1.16. In the absence of new runway capacity, it is imperative that we take steps now,
to better utilise the runway capacity that is already available. Intelligent, well
1.12. The Interim Report will set out recommendations to the Government on short
timed policy interventions could be introduced to stimulate the take up of spare
and medium term policies for making best use of existing capacity, an
capacity, especially at regional airports. These could include:
assessment of the long term need for new capacity, and a list of the most
credible options for delivering any capacity required in the longer term. - reforming the structure of Air Passenger Duty to incentivise the take up of
spare capacity by airlines;
1.13. The Commission asked interested parties to submit their proposals for making
the best use of existing capacity in May 2013. To inform the Commission’s - improving surface access to airports with unused capacity, especially rail
assessment of the most credible long term options, the Commission has asked connections to Stansted, to increase their attractiveness;
parties to submit long term options for new capacity by 19 July 2013. These
- exploring reforms which would make better use of the scarce capacity at
options will then be assessed using the Commission’s sift criteria published in
Heathrow and other London airports, particularly economic regulation and
May 2013.7 The Commission has requested that respondents provide
slot reform;
information on particular economic, social, environmental and operational
aspects of their options. The Commission will use these submissions to select a - promoting competition between airports wherever possible by removing
shortlist of options for more detailed evaluation in 2014 and 2015. economic regulation and championing consumer interests; and
1.14. The Commission will then work with interested parties to develop the options on - further liberalising the UK’s bilaterals policy to open up capacity to
the shortlist to enable more detailed evaluation. This work programme will overseas airlines.
inform the Commission’s final report to Government in the summer of 2015.
1.17. M.A.G is strongly committed to investing in the growth of its airports to ensure
This will set out recommendations on the approach to meeting the UK’s future
they make the fullest possible contribution to meeting demand in the short to
needs and provide the evidence to enable the Government to prepare a
medium term. However, with the right mix of Government policy support,
national policy statement. This is an essential first step in the delivery of future
M.A.G airports could make an even greater contribution to meeting demand
policy.
and supporting the growth of the UK economy.
M.A.G’s previous submissions to the Commission 1.18. M.A.G’s airports have much to offer in terms of their current capacity: Stansted
1.15. M.A.G welcomes the opportunity to respond to the Airports Commission is the only London airport with significant capacity available at peak times. The
consultation on long term options. We have been fully engaged in the process airport currently handles around 17.5 mppa, but already has planning consent
to date, having provided evidence on airport operational models at a recent to handle 35 mppa, and most of the infrastructure necessary to handle this
public evidence session, and having responded to all of the Commission’s volume of traffic is in place. We believe that with further development of
earlier consultations. Our previous responses are summarised for ease of infrastructure, Stansted’s single runway could handle around 40- 45 mppa.
reference below.
1.19. Manchester is the only airport in the UK other than Heathrow with two full
length parallel runways. It plays a national role serving a population of around
22 million people living within a two hour drive time. It has the potential to
support long term growth, building on the existing short and long haul network.
7
Airports Commission - Guidance Document 02: Long Term Capacity Options: Sift This includes attracting back around 4 million passengers per annum that
Criteria (May 2013)
July 2013 M.A.G - Capacity for Growth 11currently travel from its catchment by surface transport to fly from airports in the 1.25. As well as reflecting the broader UK economy, the forecasts should also
South East. consider:
1.20. East Midlands is a key national cargo airport, providing a critically important - the fact that traffic flows from the UK to emerging markets such as China
facility for express freight services for the whole of the UK. It is an important and India will grow at a significant multiple to underlying GDP growth;
regional airport serving the Midlands with the potential to handle an additional
- the potential for demand to be driven by future improvements in cost
6 to 11mppa. At Bournemouth, M.A.G has invested in new passenger facilities
efficiencies and technology;
that position the airport to play a growing role in meeting air travel demand
from across southern England. - commercial trends in the air transport sector;
1.21. M.A.G is working hard to encourage the take up of capacity at all its airports. - the emergence of other hubs in the Gulf;
Supportive policy interventions will stimulate even better use of that capacity, as
- the need to make best use of existing airport infrastructure; and
well as easing the pressure on the busiest airports. This would provide
significant benefits for consumers, industry and the UK economy by enhancing - the new competitive environment in which airports operate.
international connectivity, competitiveness and choice.
1.26. The Commission should avoid placing undue weight on the predictions of
Sift criteria forecasting models when considering how demand is likely to be allocated in
1.22. There should be an over-riding criteria relating to whether a proposal is the future; to do so could well harm the development of competition to the
capable, by itself or in combination with other options, of delivering the detriment of consumers.
objective of maintaining the UK’s position as Europe’s most important aviation
Connectivity
hub. We recommended that particular consideration be given to how the term
1.27. M.A.G recognises the significance of enhancing UK aviation connectivity to
‘hub’ is defined.
global markets. That said, UK connectivity is a national, not just a South East
1.23. M.A.G supported the six sift categories suggested by the Airports Commission issue, and regional airports can both support regional economic growth and
(economic factors; social factors; climate change impacts; local environmental ease the pressure on the South East, by attracting back some of the leaked
factors; accessibility; and feasibility considerations). We suggested that other traffic.
factors (contribution to the policy objective of maintaining and enhancing
1.28. Hubs are not the only way to maintain connectivity and indeed a broader
connectivity [particularly to emerging markets]; impact on consumers and
definition of connectivity is needed. While direct links are important, indirect
competition; promoting regional growth and development; and sub national
routes offer important alternatives, often with lower fares and greater consumer
planning implications) should also be considered.
choice. Similarly, the importance of frequency varies according to whether the
Forecasting purpose of travel is business or leisure, and whether the journey is short haul or
1.24. A positive outlook is required to ensure that we develop recommendations that long haul. A ‘one-size-fits-all’ approach to connectivity is inappropriate.
are capable of supporting sustained economic growth. The need for additional
Climate change
capacity has been reduced in the short term by the recession, but we are
1.29. Our submission pointed to the Sustainable Aviation Carbon Roadmap as
confident that growth will return. Whilst delivery of infrastructure can be
evidence that aviation will become increasingly carbon efficient,
deferred in response to a slowdown in demand, it cannot easily be accelerated.
accommodating all forecast growth to 2050 with little change in absolute
emissions.
July 2013 M.A.G - Capacity for Growth 121.30. Appropriate market-based measures will complement the industry’s efforts to Aircraft noise
increase environmental efficiency and reduce total emissions. The inclusion of 1.34. The impact of aircraft noise will be a central consideration for the Commission,
aviation emissions within an appropriate policy framework will ensure that and we will respond to the recently published Discussion Paper 05: Aviation
absolute emissions from aviation are capped and that net emissions are Noise8 in due course. Any consideration of these issues needs to be guided by
consistent with the trajectory established by the Government in its future carbon the broader policy context and in this regard the Government’s key policy
budgets. We therefore believe that climate change should not present a barrier objective ‘to limit and, where possible, reduce the number of people
to the provision of additional capacity. significantly affected by noise’ will be particularly relevant.
Operating models 1.35. The discussion paper recognises that there is still no clear consensus on how
1.31. The assessment of operating models should not lead the Commission to make best to approach issues around aircraft noise. Given this context, we believe
a binary choice between ‘hub’ and ‘dispersed’ options. Rather, it should be that the Government’s policy position to ‘continue to treat the 57dBLAeq16hour
used to develop an understanding of the airport strategies that are likely to contour as the average level of daytime noise marking the approximate onset
yield the greatest benefits, to be taken into account as one part of the of significant community annoyance’9 is pragmatic and that appropriate weight
Commission’s assessment. While both models have the potential to offer should be given to this long standing metric so that all proposals received by
significant benefits in theory, the dispersed model is best placed to translate the Commission can be considered on an equitable basis.
those benefits in practice.
1.36. The measurement and communication of noise impact has challenged the
1.32. If a new hub could be built, we could certainly see many potential benefits for industry for many years. M.A.G supports the recent Sustainable Aviation ‘Noise
the UK. However, the potential benefits for a ‘true’ hub model may prove Road Map’. M.A.G engages pro-actively with local communities and airlines
difficult to achieve in practice. Heathrow is not an effective hub and it is and has comprehensive mitigation strategies and controls in place at all its
doubtful as to whether it ever can be without substantive redevelopment and airports. The Commission’s consideration of alternative metrics is welcomed
expansion, at high environmental cost. The development of a brand new hub and M.A.G will respond to the specific alternatives that are set out.
would offer the opportunity for a fresh start, and could be designed and
operated in a way that meets the minimum requirements of an effective hub, Our approach to developing long term options
but could not coexist with Heathrow. Without a commitment from Government 1.37. The Commission’s objective for the first phase of its work programme (Phase 1)
to closing Heathrow, it would be difficult to finance investment in any new is to establish a shortlist of the most credible proposals for new capacity to be
infrastructure. taken forward for further development from 2014 onwards (Phase 2). The
second phase of work will involve developing a detailed assessment of the
1.33. Therefore, while the hub model may be the most advantageous in theory,
shortlisted options, including detailed impact assessments and business cases.
translating this into practice is likely to prove challenging. That being the case,
a dispersed model offers the most realistic prospect of delivering runway 1.38. To inform its decisions during Phase 1, the Commission requires high level
capacity to accommodate the UK’s needs, in a way which is affordable, information on costs and benefits of long term options. The Commission has
deliverable, future proofed and with lower environmental impact. This been clear that it does not require options to be supported by detailed designs
approach retains the economic benefits for the UK economy, without for new runways and terminals at this stage, or for parties to provide detailed
committing the UK to a future that is not able to adopt to changing needs. modelling or to submit cost-benefit analysis.
8
Airports Commission Discussion Paper 05: Aviation Noise (July 2013)
9
Aviation Policy Framework – March 2013; §3.17
July 2013 M.A.G - Capacity for Growth 131.39. We support the Commission’s staged approach to establishing a long list of want to consult these stakeholders as part of the second phase of the
potential options using high level information about different schemes, and Commission’s work programme, to ensure their views on any Stansted options
then applying sift criteria to identify a shortlist of the most plausible schemes for are understood and taken in account in the design and assessment of these
further development. schemes.
1.40. Options for new runway capacity at Stansted and Manchester have been the 1.44. The Airports Commission will receive options for new runways at Stansted from
subject of detailed assessment over the last ten to fifteen years. In particular: a range of third parties, including the Mayor of London. We will review these
options in due course, and subject to the agreement of other parties, we would
- between 2001 and 2003, the Government carried out detailed
be willing to engage in joint work to develop these options during Phase 2 if
assessments of the potential runway options at Stansted as part of its
the Commission shortlists the option for a Stansted hub in its Interim Report.
SERAS studies leading to the publication of the 2003 ATWP. As part of this
work, it carried out appraisals of options for two-runway and four-runway
Information on long term capacity at Manchester Airport
options at Stansted;
1.45. It will be important for the Commission to take a national perspective on the
- between 2004 and 2010, Stansted’s previous owners, BAA, carried out issues it is considering, and consider the connectivity needs of the whole of the
detailed assessments of a wide range of potential two-runway options at UK.
Stansted in preparing its planning application for the Generation 2
1.46. Manchester Airport plays a unique strategic role, having many of the attributes
project. Detailed impact assessments for a single-runway Stansted were
of a capital city airport, while being located within a UK region. Its size, route
also undertaken as part of the Generation 1 planning process; and
network and capacity mean that it performs a different role to other UK
- M.A.G conducted extensive assessment work on its two-runway masterplan regional airports. In particular, it is the only non-London airport able to support
for Manchester between 1990 and 1993, prior to the approval of its a viable long haul route network. Its scale of economic benefit is also
second runway in 1997. In 2007 it consulted on a masterplan to 2030. substantially greater than other regional airports.
1.41. Our review of long term options has drawn heavily on the information and 1.47. The Commission is looking at options for addressing demand for air travel.
assessments produced by these previous studies. Although the assessments The airport’s two runways have significant spare capacity and there is an
were carried out a number of years ago, we consider that the information agreed masterplan which shows the capability to handle 55 mppa. This can be
produced by those studies is generally appropriate for the high level sifting delivered within the current site and terminal layout. Planned investment will see
exercise that the Commission is undertaking during Phase 1 of its work the airport’s facilities grow in line with demand.
programme. Where necessary, we have updated and/or revised the
1.48. For these reasons, Manchester is not an option that requires further detailed
information to ensure it is relevant for current purposes.
evaluation. Rather, we believe it is an important component of any future
1.42. This document provides M.A.G’s initial response to the Commission on the airport strategy and its capacity should be an integral part of the Commission’s
long term options for Stansted as requested in GD01 and GD02. We would base case for growth.
be willing to provide further information to the Commission on the long term
1.49. East Midlands and Bournemouth also each have a part to play in meeting the
options where this is needed to inform its Phase 1 decision-making process.
UK’s long term needs and already have runway capacity to serve their
1.43. At this stage of the Commission’s process, we have not consulted parties with particular catchments. We intend to make a separate submission to the
an interest in Stansted’s future development, such as airlines, local people, Commission on how they can best achieve this. In the case of East Midlands, its
businesses or the wide range of local and regional organisations. We would
July 2013 M.A.G - Capacity for Growth 14role as a cargo hub is an essential element of meeting the UK’s future needs as
a competitive trading nation.
Stakeholder engagement
1.50. This submission sets out our views on the long term options for new capacity at
M.A.G airports. We recognise that the options identified in this document will
be of interest to a wide range of stakeholders, particularly those living around
Stansted and Manchester Airport.
1.51. At this stage of the Commission’s process, we are not intending to consult
interested stakeholders on the options set out in this document. However, we
will be discussing our views on the options with parties over the coming
months.
1.52. If appropriate, we will consult stakeholders on the layout options for Stansted
following the Commission’s publication of the options that will be subject to
more detailed evaluation in 2014, as part of Phase 2 of the Commission’s
work programme. We would expect this process to be informed by more
detailed work to develop the options prior to consultation with stakeholders,
and clarity from the Commission around the process it intends to follow in
Phase 2.
1.53. Stakeholders that would like to contact M.A.G about this submission should use
the email address below.
airports.commission@magairports.com
July 2013 M.A.G - Capacity for Growth 15frequencies of 15 minutes. There are additional hourly rail services linking to
Cambridge and Birmingham.
2.4. Stansted can also be accessed more widely from across London, the East of
England and the Midlands. Around 23 million people live within two hours’
2.1. This section of the document provides an outline of the single-runway operation
drive of the airport.10 Stansted is one of the main gateways for the UK and is
at Stansted, as the basis for evaluating the long term options for new capacity.
the second busiest point of entry for non-UK residents arriving by air.11 In
It covers the development of the airport to the present day and the layout of the
2011, 18 million passengers used the airport with 47 per cent of these visiting
key facilities and infrastructure. It also describes the characteristics of the
friends and family either in the UK or overseas.
surrounding area and the significance of the airport within the wider regions. It
concludes by outlining the expected passenger capacity of Stansted’s single
runway to provide a reference point for the assessment of options for additional
runways.
Stansted airport today
2.5. Over 30 passenger and cargo airlines operate from Stansted. The largest
passenger carrying airline is Ryanair which handles over 70% of all passengers.
The airport has a very large network of European routes with over 150
destinations served. Some organic hubbing activity is already occurring at
2.2. Stansted is located approximately 65km north-east of London, and 50km Stansted between European destinations, with around 10% of passengers “self-
south-east of Cambridge. The airport is served directly by the M11 motorway interlining”.12
which is dual three lanes from the M25 north to the airport, and dual two lanes
from Airport to Cambridge. The A120 trunk road runs east-west.
10
Calculations undertaken for M.A.G by Halcrow
2.3. The rail link from Stansted runs to Liverpool Street Station in the City of London 11
Stansted (2012), 'Draft Aviation Policy Framework - London Stansted Airport's
in around 50 minutes. This is a stopping service with trains departing at Response', October 31st;
12
“Connecting Passengers at UK Airports”, CAA 2007
July 2013 M.A.G - Capacity for Growth 162.6. Stansted is a significant hub for express freight services. The airport’s express east) and Stansted Mountfitchet (approximately 3.5km to the north west).
freight market, anchored by key logistical companies such as FedEx and UPS, is Harlow is located some 20km to the south.
the third biggest in the UK. In 2012, 214,000 tonnes of cargo were
2.9. The area around Stansted is intensively farmed and is mostly characterised by
transported through Stansted13, helping to connect the economy of London and
large open fields bounded by ancient and/or species-rich hedgerows.
the region with the global marketplace. The cargo hub at Stansted operates
around the clock and provides businesses with access to multiple overseas Topography, watercourses and woodland
markets including the US and Far East. 2.10. The airport is built on a clay plateau between the Stansted and Pincey Brook
Watercourses. The River Roding rises to the north east of the airport, and
The area around Stansted
dissects the clay plateau to the east of the airport. A gentle ridge to the north
east divides the Roding and Chelmer valleys.
2.11. There are several blocks of woodland around the airport, including the
Elsenham Woods Site of Special Scientific Interest (SSSI). To the south of the
A120 is Hatfield Forest which is a SSSI and National Nature Reserve.
2.12. The gently undulating topography gives rise to a “layered” effect, where
hedgerows and woodland blocks merge over distance to make the landscape
appear more wooded than it actually is. This feature of the surrounding
landscape also helps to contain views of present airport.
Development of the airport to date
2.13. The airport occupies around 956 ha of what was originally agricultural land,
and has been developed in a series of phases starting from 1942. The original
World War 2 air base, with its pattern of three runways, was constructed by
United States Army engineering battalions, and became operational in 1943.
At the end of the War, the airfield was given over to the Air Ministry. The first
civil aviation flights took place from 14 December 1946. The runway was
extended to its present length around 1954. Thereafter, a mixture of passenger
and freight operations used the airport, operating mainly from facilities to the
2.7. The area around the present airport is predominately rural and affluent. It
north of the runway.
contains a number of villages and smaller hamlets, some of which contain
homes and buildings of historical interest. 2.14. The Government granted permission for the present modern airport
development to the south of the runway in 1985. The first phase of the new
2.8. Larger towns and villages in the vicinity of the airport include Bishop’s Stortford passenger terminal opened in 1991. Subsequent permissions allowed the
(approximately 3.5km to the west), Great Dunmow (approximately 8km to the extension of the passenger terminal and the development of other supporting
facilities and infrastructure.
2.15. The “Stansted Generation 1” planning permission (October 2008) permits the
13 airport to operate 264,000 Air Transport Movements (ATMs), of which
Stansted Airport press office
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