25 June 2018

The trouble with Heathrow expansion

By Jon Hollis

If, as seems very likely, Parliament decides to endorse the Government’s plans to approve the building of a third runway at Heathrow Airport later today, there remains a very good chance that that runway will never actually be built. Indeed, it seems likely that parliamentary approval will be the precursor to years of judicial reviews and court cases.

But if building a third runway at Heathrow is the answer, what is the question? The Davies Commission, which recommended that Heathrow be allowed to build a third runway, looked at how much aviation capacity the UK might need in the medium-term and how this could be achieved. However this approach was always flawed because it made no real effort to consider how air travel will evolve over the coming decades.

There are two possible models for the future of aviation and the sort of airport expansion you choose depends very much on which one you believe will prove most viable.

The first model assumes that hub capacity remains all-important. The hub model is one of aggregated demand, so it assumes that a UK-sized country would have one major airport that is large enough to have regular internal flights to and from a variety of regional airports.

A useful way to think about this is to consider how many people from different cities in the UK wish to travel to different world cities on any given day. If, for example, there were 30 Glaswegians who wished to travel to Hong Kong every day then it would not be economically viable for an airline to run a daily service from Glasgow Airport. However, if you collect up everyone in the UK who wishes to fly to Hong Kong on any given day then, as long as it’s easy to travel from the various regional airports to the hub airport, a regular service becomes economically viable. Consequently the hub capacity model enables regular flights from the hub to destinations all over the world.

The second possible model assumes that hub capacity is of diminishing importance. As technological advances allow smaller planes to travel further and further, more and more flights can be direct. So, for example instead of getting from Bristol to London in order to fly to Singapore, you’ll be able to fly directly from Bristol to Singapore. Clearly it is preferable to fly direct rather than change planes – when was the last time you decided that what your journey really needed was a three hour pause in Dubai? – so if direct flights are available and reliable then they will have the upper hand.

So what does this mean for Heathrow? Well, if the first model is correct then we’ll need a far bigger hub airport than Heathrow can ever be. If we look at nearby hub airports, a clear pattern emerges. Charles de Gaulle has four runways, as does Frankfurt, whilst Schiphol has six. This gives them the capacity to act as a hub not just for France, Germany and the Netherlands respectively, but for a much larger area.

In addition, it would be ideal to have an airport that operates round the clock, seven days per week in order to maximise capacity. Given Heathrow will not and cannot have four, five or six runways and is likely to have more limits on night flights rather than fewer, following the logic of the “hub” model would mean finding somewhere that ticks those boxes. This is the logic behind Boris Johnson’s preferred “Estuary Airport” proposal, but that is not the only possibility.

Many adherents of Heathrow expansion will try to fudge this and pretend that a third runway is all that Heathrow needs. The reality is that, assuming the hub model is correct, a third runway at Heathrow would not be anywhere near enough and yet further expansion would be practically impossible. Furthermore, for Heathrow to be truly effective as a UK hub it would need to significantly increase the numbers of internal flights that it offers. However in actual fact those numbers have been falling, with BA flights from Leeds Bradford Airport to Heathrow cut from 20 to just 10 per week as recently as January because those numbers weren’t profitable.

If the second model is correct then the key becomes pushing up standards and driving down prices by increasing competition between airports. London already has more airport capacity than any other city in the world, so improving connectivity to Stansted and Gatwick and then allowing them both to build a second runway would make sense. In addition, expanding regional airports throughout the UK would help to boost local economies and ensure that we see a reduction in connecting flights as more and more people fly directly to where they need to go. Once again, if we accept this model then it would make no sense to expand Heathrow given that — even ignoring the massive noise and air quality issues — doing so is so much costlier than alternatives.

Therefore, given that expanding Heathrow is the wrong approach, what should the Government do now? Frankly they should pick a model and follow the logic of their choice. Personally I’m persuaded that hub capacity will remain very important for decades to come, but I’ve read and listened to very strong arguments in favour of the point-to-point model. So if making a proper decision is too difficult then what’s the next best option? Allow Gatwick to build a second runway – after all, it would be half the price of a third runway at Heathrow and far less disruptive – and use the time that buys to decide where to build a 4 runway hub airport with room to expand further.

I still believe it’s unlikely that a third runway at Heathrow will happen, but it seems inevitable that the Government will expend vast amounts of energy and political capital trying to make it so. In 5-10 years, when nothing has been built there may well be another chance to make the right decision. Hopefully they’ll take it.

Jon Hollis works as a Senior Transport Researcher for the GLA Conservatives and is a former Chairman of Twickenham Conservative Assocation. He is writing in a personal capacity.