Heathrow’s eventful start to 2008

After the worst possible opening day for Terminal 5 yesterday, following the baggage chaos and cancellation of flights, it is clear that life at the world’s busiest international airport is rarely dull. The first three months of 2008 have been unusually eventful, at least in terms of media-worthy stories.

17 January British Airways flight 038 from Beijing crash-lands short of the southern runway. Miraculously no-one aboard the Boeing 777 is seriously injured.
26 February Greenpeace protestors climb on top of a British Airways A320 to air their concerns about the environmental impact of a possible 3rd runway at Heathrow.
13 March A Sri Lankan man climbs a perimeter fence and is arrested by Police.
14 March The Queen officially opens the Richard Rogers designed Terminal 5.
18 March The first commercial Airbus A380 flight arrives from Singapore operated by Singapore Airlines.
27 March Terminal 5 opens for business.
30 March The summer 2008 season begins with the arrival of four new airlines serving the transatlantic: Continental, Delta, Northwest and US Airways finally get access to Heathrow having previously been excluded from operating to the airport under the terms of the Bermuda 2 bilateral agreement.
Image: Queen officially opened Terminal 5
As the Queen officially opened Terminal 5 on 14 March, passengers at Terminal 4 were forced to queue the length of the building, both inside and out, as they waited to check-in. The 30 million capacity Terminal 5 is described as the “enabler of the transformation of Heathrow”. Terminals 1, 3 and 4 are being renovated, while Heathrow East will replace Terminal 2.

As if all that was not enough the Chief Executive of BAA, which owns and operates the airport, has been replaced and the Civil Aviation Authority approved a well-above-inflation increase in airport charges which infuriated the airlines. Fortunately, the threat of strike action over the Easter period by British Airways staff was averted.

Traffic flat for last four years

While passenger numbers at Heathrow grew by 25% between 1994 and 2000, in the last seven years traffic has grown by less than 6% as capacity bottlenecks on the runways, in the terminals and on the apron started to bite.

Chart: London Heathrow traffic 1994-2007
Source: UK CAA

It is worth noting, however, that the average aircraft size at Heathrow these days is around 194 seats. This is well below the figure achieved by several Asian airports such as Bangkok (256), Hong Kong (259) and Singapore (250). The average aircraft size of flights operated by British Airways and bmi, the two busiest airlines at LHR, is 186 and 129 respectively. Luxair, with its twice daily flights to Luxembourg, operates tiny Embraer 145 regional jets with just 49 seats. Obviously, the value of this comparison is limited as Heathrow is closer to a lot of important centres – including Luxembourg – whereas the Asian centres are further apart.

British Airways is not that dominant shock!

Compared to other major European hubs, and especially most of the major US hubs, British Airways is not as dominant at Heathrow as its competitors would like to make out.

Chart: Top 15 airlines at LHR
Source: OAG Max Online for w/c 31 March 2008

BA operates just over 40% of all flights and has less than a 40% share of total capacity. More importantly its nearest competitor, bmi, operates to over 30 destinations and has a greater than 10% share of all flights. While bmi keeps BA honest on its short and medium-haul routes, Virgin Atlantic is a fierce competitor on long-haul routes and will this summer operate to 19 destinations in 10 countries.

Image: BA, BMI Planes
BA operates just over 40% of all flights at Heathrow and has less than a 40% share of total capacity. Its nearest competitor, bmi, operates to over 30 destinations and has a greater than 10% share of all flights.

US carriers finally break into fortress Heathrow

As a result of bargaining between the US and the EU, Heathrow has finally been opened up to all carriers wanting to operate transatlantic services. Previously only BA, Virgin, American and United had permission to operate from Heathrow, the latter two having taken over the rights previously held by Pan-Am and TWA after they collapsed.

Image: Air France and Delta Air Lines sign joint venture agreement
Air France and Delta Air Lines have signed a joint venture agreement, beginning in April 2008, to share revenues and costs on their transatlantic routes, including those between Heathrow and the US. Delta is to begin serving Heathrow using three of Air France’s slots, operating services to Los Angeles, New York JFK and Atlanta.

The four other major US carriers have taken the opportunity presented to launch transatlantic services from Heathrow, most of which were previously operated from London Gatwick. This has required the obtaining of extremely scarce landing and take-off slots, but either through deals with alliance partner airlines, or acquisition on the open market, this has been achieved. The new transatlantic services starting from Heathrow this weekend are:

Airline Airport Weekly frequency Comment
Air France Los Angeles 7  
American Dallas/Fort Worth 7 Moved from LGW
American Raleigh/Durham 7 Moved from LGW
British Airways Dallas/Fort Worth 7 Moved from LGW
British Airways Houston 14 Moved from LGW
Continental New York Newark 14 Moved from LGW
Continental Houston 14 Moved from LGW
Delta Atlanta 7 Moved from LGW
Delta New York JFK 14 Moved from LGW
Northwest Minneapolis 7 Moved from LGW
United Denver 7  
US Airways Philadelphia 7 Moved from LGW
Source: OAG Max Online for w/c 31 March 2008

Apart from the four new US carriers one other airline is making its debut at the airport this weekend. Raising the number of scheduled airlines operating at Heathrow to 90 is Blue1, the SAS-owned airline based in Finland, which is launching daily flights to Helsinki having previously operated them into London Stansted.

New York JFK is #1 route

In terms of weekly seat capacity this summer New York JFK is by far the leading route to and from LHR (with flights operated by BA, Virgin Atlantic, American, Delta, Air India and Kuwait Airways) though Amsterdam is tops for weekly flights (171 shared between BA, bmi and KLM).

Chart: Top 15 routes at LHR
Source: OAG Max Online for w/c 31 March 2008

A total of 165 destinations will be served with non-stop flights this summer ranging from Manchester (just 242 kilometres away) to Singapore (at 10,877 kilometres). New routes already announced for later in the year are daily flights to Detroit and Seattle with Northwest and a new British Airways route to Hyderabad.


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