Re: Route Development & Airport Rumours
It's very difficult to understand context from the written word but on the face of it I'd say he, or whoever wrote the email, appears quite rattled? Especially points 12-15. Well done for the comprehensive reply though.
1. BHX is not expensive, the tariff is published for non based airlines or ad hoc flights. All carriers at BHX operate on some form of discount or concession.
I'd be interested to know why there are studies published which show that BHX is, and why it's said that airlines have stated that it is too. Also I wonder what is meant by 'non based airlines'. Is it airlines that don't serve BHX at all, in which case it would only apply to ad hoc and diversions, or is it airlines that don't have an
actual base in the way the likes of Monarch, Flybe, Thomson do, in which case it would apply to
a lot of airlines including the likes of United, Emirates, PIA etc? I have no doubt all carriers have some form of discount but it would be interesting to know what sort of discount, what the original figure before discount was and how, after discount, it compares to other similar airports, we never will know though as it would all be commercially sensitive information.
2. BHX spends or discounts around £53m a year in market support for its airlines.
I don't know how this compares with other similar airports so can't comment whether this figure is good, bad or average?
3. There are 27 airports in a 150km radius around BHX (with an average flying time of 5-10mins between them) all competing for 195m passengers each year (where LHR takes 73m, LGW 36m, MAN 20m, STN 18m, LTN 10m) which means there are 22 airports competing for 38m pax. It is competitive!
8. We talk to lots of airlines but we have to match potential traffic throughput, destination, aircraft type and capability and onward destinations in to the mix. So when we talk to airlines about Chicago – the equipment has to be available and right and we have to have3 no competing destination in range to win the service.
9. Our proximity to LHR is an issue and airlines like to fly where the national carrier is based – and that’s LHR. Many of our pax prefer to go to LHR because it is a short drive. MAN – LHR is a tad too far.
I totally agree but all those other airports also have to compete and some appear to be doing much better than BHX. I've said before that I think one of the reasons we have such a poor offering to the USA in particular is the proximity of LHR and the sheer frequency and cheaper prices available for such a short drive, so do we now have to concede that this is the way it is, LHR will take the majority of the regions pax with MAN mopping up those from the north who don't want to drive all that way? If so I can live with that, but, when we're seeing a constant stream of press releases banging on about how much business demand there is from BHX it sends out mixed messages. Is the demand there, if so there should be no issue in getting the flights, if it isn't there then stop telling us it is.
4.Yield is the key not airport charges.
Would airport charges not contribute towards overall yields?
5. We have spent £200m of shareholders funds putting the airport right – and sorry no funds for the spotters - s we have had to build a runway extension, control tower, pier terminal, hangar, fire station rebuild etc and support our airlines.
6. We are doing what should have been done 30 years ago and the behavioural economic is such that passenger are sticky and like birds of a feather they flock together. Not having the capability means that we were not able to play.
It's a very good point, BHX was woefully neglected for many years when other airports were investing, is it too late to catch up?
7. BHX will not pay as some airports do for traffic, reportedly, £4m in the case of Melbourne for Air India or millions of £ in the case of Edinburgh and if the route requires continuous subsidy – it is not sustainable.
The new owners of EDI said their intention was to build the airport up then sell it on and I've think I've said before that it doesn't appear sustainable, especially if, as suggested, they're paying for airlines to fly there.
10. Advertising – the airport we do it, just because, you don’t see it doesn’t mean that it isn’t being done.
I'm no top advertising executive but doesn't the whole point of advertising your product come down to the fact that
your potential customers see it???
11. We don’t talk about individual aircraft deals but they happen and they are sustainable.
No one would expect commercially sensitive information such as individual deals to be made public and they do have to be sustainable to ensure the companies economic future but I wonder if there is
any scope for even more to be done, whether just that little bit extra could have made the difference. Of course if BHX are already selling their product at rock bottom prices and have no room for leverage at all then I can accept that.
It's good for him (or his people) to take the time to reply. The issue of airport charges will never be resolved, it's long been suggested by many that BHX is a very expensive airport to fly from, maybe it's true, maybe it's just an excuse when someone isn't interested but no one apart from the airlines themselves will know exactly what is being paid, so it can't be proven true, and BHX can't fairly defend themselves without revealing sensitive information, which won't happen, so we can only believe what we are told. A lot is made of the geographical location, and LHR being so close is definitely a major downside, but what about the big headlines that were made about BHX being
'the best connected airport in the country', should that not be a distinct advantage when competing for pax with the other airports? The two biggest gripes about BHX seem to be the destinations simply aren't available (see MAD, PRG, LIS, WAW, BUD, BER.....all available from the likes of EMA, LTN or BRS) or that it is too expensive when comparing similar flights from other airports, why is anybody's guess, lack of competition, covering airport costs?
Anyway we've had a few pieces of good news recently so I wish him and his team all the best for the future and hope to hear even more good news soon :good:
