CEO of BAA
Stephen Nelson talks about Terminal 5 and BAA's plans for the development of Heathrow.
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On Terminal 5
I think the first thing to say about Terminal 5 is it is the first step in the transformation of Heathrow, so what passengers will be getting from Terminal 5 and beyond, from Heathrow over the next five years is quick check in, light airy buildings, retail that's on your way rather than in your way, and a calmer more pleasant passage to your gate room from which you can board the aircraft.
On further improvements at Heathrow
Well it's a very progressive plan we're going to be bulldozing Terminal 2, within twelve to eighteen months, and my own view is that can't come quick enough, it's a fifty-year-old terminal everybody who's been through it will talk about the very low ceilings, and we're going to be replacing that with a new terminal which is called Heathrow East, and ultimately that will replace Terminal 1. Heathrow East will be a building as magnificent as Terminal 5, a different design, but it will be holding ultimately up to, ah, thirty million passengers. But it doesn't stop there, we know we've got to improve Terminal 1 in the meantime, that gets refurbished as well as Terminal 3 and Terminal 4 so major structural development because we need a better class of airport.
BAA controls arguably a couple of elements of things that are really important to passengers, the security queuing and the whole retail side of things, but we don't control check-in and we don't control immigration and we don't control the time it takes for your bag to be loaded, from the plane on your arrival onto the belt. And so we have a strategic issue of coordination, and we're gonna be taking a lead in that to make sure that we collaborate properly.
On the investigation into BAA’s monopoly
The strategic question that not only needs to be answered by the regulator but also needs to be answered by government and other stakeholders is, how do we accelerate the provision of new capacity? And new capacity in this case means runway capacity, our airports are full, and the White Paper in 2003, the policy statement on this, indicated that we needed more capacity to meet growing demand.
I think there's also a really important bigger picture, here which is that we are already losing ground to Paris, to Amsterdam, to Frankfurt. Paris has four runways, Amsterdam has five. Frankfurt will have four by 2011. Paris already has the capacity that we will be seeking around 2020. This will, in a globally competitive market place, this will have an impact on us unless we build out at Heathrow.
CEO of British Airways
Willie Walsh talks about the capacity problems at Heathrow and the environmental impact of flying.
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On Terminal 5
Terminal 5 is a once in a lifetime opportunity for British Airways. For the first time in about forty years we'll be able to bring most of our operations under one roof at Heathrow. And it really will transform the customer experience for British Airways customers and to Heathrow. I think people will be genuinely impressed. In fact, I think they'll be wowed when they walk in through the door of ‘T Five’.
Heathrow has probably been a victim of its own success. It's a very busy airport. It was designed for 45 million passengers; it's handling about 67 million. Critical issue and the problem at Heathrow is the lack of runway capacity. The runways are full right throughout the day. It's 99 percent full. And that's very different to all of the other major hub airports in Europe where they will tend to have about twenty, twenty-five percent excess capacity. So when you get disruption at Heathrow there is no excess capacity to deal with that disruption and the disruption just continues through the day.
On climate change
I know the environmental issue is absolutely critical and the track record of British Airways I believe is very strong on this issue. And what we have for a long time argued is that you must balance the economic benefit of the airport against the environmental impact. It's not one or the other, you've got to balance both. So we have, for a long time, been a proponent of the inclusion of aviation in the EU emissions trading scheme. And I believe that that's the best way, the most efficient way to deal with the growth of aviation and to ensure that any growth that takes place is operated within an emissions’ cap. And that means if we can't reduce our emissions the industry must pay for someone else to reduce their emissions. This is a global issue, it's not about one industry, it's not about one country, it's a global issue. And I think the most effective way to deal with that is through emissions trading.
Simon Calder shares his experiences of travelling through Heathrow and comments on the lack of competition for BAA.
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On capacity at Heathrow
The big constraint at Heathrow is simply the number of planes you can get on and off those extremely valuable runways, and I'm afraid that won't change until you have either an adjustment in the way that those runways are used so that they can be used for landings and take-offs at the same time, or you build that extra runway. And neither of those are at all palatable for anybody who happens to live around Heathrow.
If you're gonna have problems in aviation in Britain they will strike first and deepest at Heathrow. That's the way it's always been, I suspect it's the way it always will be, but I must say the response since the 10th of August 2006 has been, I think rather short of brilliant, I use Heathrow probably once or twice a month and the uncertainty is the worst thing. Sometimes you can breeze through, no queue at all, you're through in five minutes, fantastic, other times it might just be a Tuesday night, Terminal 2 about half eight at night when you would expect almost nobody there and you have to wait for half an hour. Because there is so much uncertainty you have to build in ludicrous amounts of time because clearly these days the airlines take no prisoners you know if you're late for a flight the flight goes without you and you are stuck. So it's one of those things where now whenever I'm using Heathrow I have to think well of course I'd better build in an extra hour, that doesn't do anything for your stress levels.
On the question of BAA’s monopoly
It's absolutely bonkers that in Britain we benefit from the most competitive aviation market in the world which is why you and I can fly further for less than pretty much anyone else on the planet, yet there is no competition between Heathrow, Gatwick and Stansted, the three big airports in Britain.
There's an elephant in the room as there always seems to be, in aviation it's a rather flatulent elephant and it sits there and it is the environment, and what are you going to do about it? You have the situation where government are with one hand saying oh it'd be really good if you flew a bit less, and with the other hand actually giving money particularly to regional airports to encourage more flights. However soon I think it is going to coalesce in, certainly into some Europe-wide action actually to suppress demand, that is terrifying for the airlines and it's terrifying for the airports: they want to see unbridled expansion. But an awful lot of people want to see exactly the opposite, they want demand suppressed, they certainly don't want any increase in the amount of flying, and I can see plenty of arguments why we should have far more efficient flying to preserve the environment.
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