Heathrow’s third runway: a sting in the tail for the regions

Will regional airports in the UK gain in the future from an enlarged Heathrow and, if so, by how much? More UK cities might be linked directly into the Heathrow network and existing domestic services will get more frequencies (although how many more depends, amongst other things, upon future levels of airport charge and whether current discounts are maintained). However domestic services apart, there is likely to be a significant downside for many regional airports which today’s report from the Transport Committee illustrates. The Committee appears remarkably complacent about the eventuality; indeed it encourages the bleeding of the regional airports by appearing to suggest that domestic services into Heathrow are given preferential access.

The current squeeze on Heathrow capacity does mean that there are a few but growing number of overseas long-haul flights (and many short-haul ones) from the larger provincial airports. Some current long-haul flights are on a seasonal basis (suggesting that in these instances demand is still somewhat marginal) but others are year-round: from Birmingham, Edinburgh, Glasgow, Newcastle and, in particular, from Manchester; last winter, Manchester’s long-haul route numbers reached double figures. Flights from these airports reach into North America, the Gulf, Indian sub-continent and the Far East including China.

The opportunity for launching long-haul, lower-density routes is growing as aviation technology progresses. New smaller, wide-bodied aircraft like the Boeing 787 and Airbus A350 are more fuel efficient and cheaper to operate and even smaller narrow-bodied aircraft, like the new A320neo and 737MAX have an impressive (trans-Atlantic) range. One can reasonably expect, therefore, with a growing regional demand, improved aircraft technology and an increasingly constrained runway capacity at south eastern airports, a much larger number of services to long-haul destinations from the major regional airports in the next few years.

But, what will happen at regional airports following Heathrow expansion? On this specific issue the current (draft) Airports NPS (the final version will require Parliamentary approval) is vague, simply commenting: “[W]hile expansion will also see some displacement of passengers from regional airports to the London system, overall regional airports are expected to continue displaying strong growth in passenger numbers by 2050” (3.31). Growth, arguably, might remain strong, but according to NPS figures, it is expected to be less strong (and probably more geared to short-haul). Traffic displacement to Heathrow will be a reality, substantial and of questionable benefit to the regions.

If one refers to the Supplementary technical reports and specifically the latest revised Appraisal Report, Table 3.7 shows that in 2030, for example, compared with a no-expansion baseline, the introduction of the preferred North West runway at Heathrow will reduce annual terminal passengers at regional airports by 5 million; by 2050 the reduction is shown as 17million. And this is in spite of the anticipated increase in numbers catching flights from the regions to an expanded Heathrow.

Table 3.6 in the Appraisal Report suggests that international passengers from UK regions switching planes at Heathrow will increase by 5.9 million per annum by 2040, a huge expansion of more than a half compared with the no-expansion baseline. Absent the new Heathrow runway, many, probably most, of these passengers would have flown from the regions either directly on new or more frequent flights or by changing ‘planes somewhere other than Heathrow, (including UK regional hubs like Manchester). In a nutshell, Heathrow expansion can be expected to drain the regional airports of international frequencies and probably routes too; some would view the palliative of more flights to Heathrow as a poor substitute (although, apparently, not the Members of the Transport Committee).

On the basis of these projections, it is not at all clear that Heathrow expansion will do much to re-balance the economy between north and south. In short, regional airports and, arguably, their wider regions could very well be better off without a Third Runway at Heathrow which is not to say that the London region or, indeed, the country as a whole will not gain. And, absent planning constraints, without question Heathrow will have expanded long ago, competing with the regions to provide links to the world. But this competition should be fair and ring fencing Heathrow slots, giving preferential treatment to domestic flights, should be ruled out. Some regional airports currently acting as cheerleaders for these ideas need to be careful what they wish for.

Member of the Advisory Committee

Prof David Starkie is a senior associate at Case Associates, London. His many publications include  Aviation Markets: studies in competition and regulatory reform (Ashgate, 2008). David has advised governments and legislatures across the world on transport policy issues. He was economic advisor to the European Commission’s delegation at ICAO-related proceedings on aviation and the environment, Montreal and Washington DC 1995-97, and was on the Civil Aviation Authority’s expert panel for NATS price cap review 2006 and airport competition framework assessments 2010-11. More recently he was on the Airports Commission’s expert advisory panel. David is the author of the book The Motorway Age: How post-war governments reacted to rapid traffic growth.

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