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Cardiff has the potential to be a UK hub airport
by SionBarry
WE have been hearing a lot about airport capacity in the south east of England.
Get business news by email WE have been hearing a lot about airport capacity in the south east of England.
As far as runway capacity is concerned, Heathrow is full. If we believe what we read in the media, the solution for Heathrow is a choice between a third runway or a brand new airport in the Thames Estuary.
The Heathrow option proposes a new third runway to the north of the existing runways but isn't a full size runway and would be designed to only take short haul traffic.
So, even this unpopular option would not be a long term solution to congestion at Heathrow.
The new airport in the Thames Estuary, the so called "Boris Island" option, delivers a new hub airport but even if we overlook the difficulties of moving the jobs and companies associated with the airport from one side of London to the other, the site of a new airport is something that has been argued over for the last forty years, we find building new airports on green field sites in the UK just too difficult.
Governments find it very difficult to make unpopular decisions and just when it needs to be decisive it manages to put the decision off to some time in the future. It has done this by setting up an independent commission chaired by Sir Howard Davies to look at options for maintaining the UK's status as an international hub for aviation.
It is not, therefore, an inquiry into airport capacity but into international hubs. International hubs are the interchanges that enable passengers to change aircraft to reach destinations that can't be connected by point to point services. The advantage for the host nation is the extra density of passengers allows a greater number of destinations to be served and it becomes a more attractive location for business.
It is important to point out that whatever decision is taken, London is not about to be starved of airport capacity. There is the option of building a second runway at Gatwick Airport after a no development agreement expires in 2019 and the "Future of Aviation" studies by the UK Government in 2003 identified the potential for a four runway airport at Stansted Airport in Essex.
Indeed, if Heathrow continues as a two runway airport, it will still continue to grow although at a slow rate. It will continue to grow because the dominant carrier at the airport, British Airways, has ordered bigger aircraft.
The British Airways A380 fleet will start being delivered from next year and will increase capacity even though runway slots are constrained.
So looking solely at hub capacity, is there any reason why the UK should only have one hub airport and have it located in the south east of England? The answer is that there is no reason and there are a number of disadvantages with only having a hub at Heathrow.
It leads to other parts of the UK being very poorly connected, being very poor locations for business and does nothing to address the unbalanced nature of the economy with the greatest economic activity being pushed into the south east of England.
With a number of large airports around the UK, why, unlike other countries can we not sustain more than one international hub? The answer lies in the policy of creating one dominant airline in the UK which burdened with a high cost base concentrated operations at one airport where it could make easy profits.
Successful international hubs have one dominant airline or international airline grouping because of the advantages of co-ordinated scheduling, pricing and ticketing.
If we accept that dispersing hub capacity around the UK will lead to a more balanced economy and make locations outside of the south east of England more attractive for business without harming connectivity in the south east of England, what hub capacity can we provide in the south west of England and Wales?
We should ignore the option of a greenfield site as too expensive and just too difficult to obtain planning permission for. There is a danger that you continually argue about it for forty years without actually achieving anything.
Bristol Airport is very successful in the market in which it mainly operates which is the low cost market from Wales and the south west of England and can be left to do what it does best.
What it can't become, because of the constrained nature of the site, is an international hub airport.
This leaves us, by default, with Cardiff Airport. It is an airport that operates for 24 hours of the day and has few environmental concerns. The transformation to "Western Gateway" airport would require a runway extension of 600m taking the total length to nearly 3,000m and allowing fully laden services to the American west coast and fully laden freighter aircraft to use the airport.
The terminal would need to move to the north to allow more room for aircraft stands. The total cost would be about £250m, very small numbers compared with spending on transport infrastructure in England or the cost of a new airport.
It would create thousands of jobs and improve the attractiveness of Wales as a business location. It is exactly the sort of visionary project that should be enabled by the creation of the enterprise zone around the airport.
There are a number of other projects that could enhance the airport if they come to fruition.
Electrification of the rail network in South Wales is definitely coming and will improve surface connectivity and there is the possibility in the long term of high speed rail coming to South Wales and making the airport more accessible from England.
If the Severn Barrage is built and if it includes some form of transport connection between England and Wales, the journey times between the south west of England and Cardiff Airport would be transformed.
There will be those who will say that a small country like ours cannot sustain a hub airport and I can point out other small countries that not only sustain a hub airport but compete with other hub airports close by.
This airport would serve not only a vibrant city region in Cardiff but a city region connected to another city region, Swansea, and to Bristol, by fast rail links.
The success of the hub airport does depend on attracting an airline partner to build a route network. I can point to a number of airports that have the infrastructure but are never going to become hub airports.
If the current Silk Commission leads to the devolution to Wales of powers over Airline Passenger Duty, we may have the mechanism to attract an airline partner if the powers are used wisely.
The proposal for the new hub airport and the surface transport improvements associated with a new high speed rail line and the potential of the Severn Barrage to provide transport infrastructure will now be taken forward by the Western Gateway Project with submissions to the Welsh Government, the UK Government and the Davies Commission.
Martin Evans is Visiting Fellow at the University of Glamorgan Business School
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