Tuesday, January 20, 2009

Essential reading: 2M Group on Heathrow Expansion

Stop Heathrow Expansion
The 2M Group
has an excellent summary on the economics of Heathrow. No need to add much:


Current airport



• Fewer than 26% of users of Heathrow are travelling on Business(1).




35% of people travelling to Heathrow are interchange passengers – they
never leave the airport. Therefore they contribute little to the UK
economy outside of the aviation industry.



• 100,000 flights
a year, nearly a fifth of all flights, are to destinations in the UK or
near-Europe where there is already a viable rail alternative. There are
60 flights per day to Paris – more than any other destination. 36
flights a day go to Manchester, more than to Hong Kong or Chicago.




London’s airports handle 128 million passengers a year – that is more
than use the airports serving Paris and Frankfurt combined.




Ferrovial, the Spanish owners of Heathrow, make a substantial profit
from passengers using the airport. In the year since Ferrovial bought BAA (the operators of Heathrow) – capital investment fell by 15% but revenue grew from £1.077 billion to £1.232 billion.



Heathrow Expansion



• Only 1% of members of the Institute of Directors think airport expansion is a priority(2).



• 78% of London firms are against expansion at Heathrow(3).



• Fewer than a sixth of London firms would even consider leaving London if the airport did not expand(4).



Aviation generally



• £9 billion a year in tax subsidies is given to the aviation industry (It is zero-rated for VAT. It does not pay on fuel).



• Aviation fuel costs 26p a litre whereas petrol for cars is about £1 a litre.




£9 billion would pay for 22 new hospitals(5) – it cost £400 million to
build London’s University College Hospital – or 450,000 nurses (current
nursing positions advertised at £20,000(6).



• 89% of the general public think that businesses that create pollution should be more heavily taxed(7).



• 63% of the general public would be prepared to sacrifice one foreign holiday a year to save the planet(8).



• Only 17% of the general public are opposed to constraining growth in air-travel(9).




Tourists visiting the UK spend at least £15 billion pounds less per
year than UK tourists going on holiday overseas. Expanding aviation
simply means increasing the trade deficit for UK tourism.




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