London should follow New York airports model - Gatwick CEO - Reuters UK

By Rhys Jones

LONDON | Wed Nov 28, 2012 2:50pm GMT

LONDON (Reuters) - London should follow the example of New York by allowing its secondary airports to add new runways to better compete with the capital's Heathrow hub, the head of London's Gatwick airport said on Wednesday.

Heathrow - the capital's busiest airport - is operating close to full capacity after the coalition government blocked development of a third runway, which would have led to a significant increase in the number of planes flying over the capital.

But Prime Minister David Cameron is under intense pressure from business leaders to end years of deadlock and create more airport capacity in southeast England to counter competitive threats from other European hubs.

A commission chaired by former Financial Services Authority head Howard Davies to analyse ways to do this will report in the summer of 2015.

"The key decision for Davies is whether to create a competitive airports market in London with a second runway going into Gatwick and Stansted, having three two-runway airports competing with one another," Stewart Wingate, Gatwick's chief executive, told Reuters.

"London should follow the example of New York, which has several airports competing with one another, offering more choice to passengers and pushing up service levels."

Gatwick, south-east of London, and Stansted, to the north, are both currently single runway airports.

However, in New York, Newark and LaGuardia airports both have two runways, competing for passengers with the larger John F. Kennedy.

In London, Heathrow believes it should be able to expand because it operates as a hub, with around a third of its customers being transfer passengers. Hub airports allow passengers to change planes easily for travel on to another destination.

Wingate, however, claims Ferrovial's Heathrow has overstated the importance of transfer traffic, citing research from industry body IATA that shows 93 percent of people who travel through the capital start or end their journey in London.

Gatwick is a point-to-point airport, mainly focussing on the leisure market and moving around 34 million passengers a year through its two terminals.

Under a long-standing local agreement that runs to 2019, Gatwick is not allowed to build a second runway.

But bosses at Gatwick, owned by Global Infrastructure Partners, are studying options to build a second runway and plan to submit the findings to a government next year.

Earlier on Wednesday Gatwick said its first half profit rose 4.8 percent to 172 million pounds.

(Editing by Rosalba O'Brien)