Five expanding airports, airlines coming and going, and a green-centric consumer base are creating open skies and open possibilities.

Continental Airlines was in the air before the ink was even dry. Within hours of the March 30, 2008, start date for the “Open Skies” agreement, which allows all U.S.-based air carriers access to London’s Heathrow airport and any other city airport in the E.U., Continental took to the skies. The airline’s brand-new Newark–Heathrow flight touched down just before 7 a.m. Delta’s inaugural New
York–Heathrow flight followed an hour behind. The Open Skies agreement, negotiated between the European Union and the United States, changed the industry landscape and put an end to formerly exclusive Heathrow landing rights reserved for American Airlines, United, British Airways and Virgin Atlantic. Given how successfully those four carriers have cashed in on the world’s most lucrative aviation route, the eagerness of other players to join the club at the busiest international airport on the globe is understandable.


Aviation consultant Peter Morris, who works for Ascend in London, says carriers want a slice of Heathrow–New York business not just for the high number of passengers, but for the type of passengers who fill up the flights.


“Certainly the key thing is the proportion of premium revenue. You just wouldn’t find any other two cities with that level of business-class traffic,” Morris says. For that route, business- and first-class passenger rates average 20 percent, compared to a high of five or six percent of routes such asLondon–Miami. British Airways alone flies the route 55 times a week, which speaks volumes about the amount of profit that carriers can make shuttling travelers between two premier financial centers. By some estimates, BA earns 60 percent of its profits from its London–New York traffic.

Busy skies, busy airports

The E.U. believes that overall seat capacity between the U.S. and Britain will jump anywhere from 20 to 30 percent in 2008. The E.U. also hopes that open skies will mean lower fares, although record fuel prices are expected to curtail most bargains.

But, Morris adds, while the money may be there, airlines setting up shop at Heathrow should expect it to be anything but a first-class experience. “It has the highest level of delays, the mishandling rate on bags and a litany of other problems. Heathrow comes with its own grief,” says Morris of the airport’s creaking—and, in some cases, crumbling—infrastructure, which attempts to squeeze 68 million passengers annually through buildings designed for 45 million. One senior American Airlines official bluntly describes the airport as “a bit of a dump.”


The airport’s owners, BAA (British Airports Authority), sniffs that it has ambitious £4 billion ($8 billion) upgrade plans in the chute, in advance of London’s hosting the Olympic Summer Games in 2012. But the much touted new £4.3 billion ($8.6 billion) BA Terminal 5 opened shakily in March to instant chaos. It left thousands of passengers with cancelled flights and lost an estimated15,000–20,000 bags during its first week of operation. The airport’s owners and BA spent days blaming one another for what senior politicians labeled a “national embarrassment.”

Lord Clive Soley, a longtime politician with Britain’s governing Labour Party, also heads up Future Heathrow, an airport expansion lobby. He believes that the dismal launch of Terminal 5 may yet have a silver lining, if it forces the airport’s owners and the government to aggressively update facilities.

“If anything, I think while it did immense damage to the reputation of British Airways and BAA, it also did highlight how dire the need for expansion really is,” Soley says of the bid for a controversial third runway at Heathrow that would see at least one small community torn down. Currently, the airport’s two runways operate at 98 percent capacity, leading to lengthy take-off and landing delays.

Soley worries that London’s leading position in international finance has already been compromised by a drop in the number of connections offered at Heathrow, due to the airport’s lack of runways. “We risk losing out to Frankfurt or others….We do not have an international hub, it’s that simple,” he concludes.

Spacewise, the only other credible options for large-scale expansion are Gatwick, 25 miles to the south; and Stansted, 35 miles east. But Richard Gooding, chief executive of City Airport in the regenerated docklands area in east London, says his privately owned airport’s clear focus on shuttling business travelers from where they are to where they need to be—and thus his refusal to make the airport a hub—is beautiful in its simplicity.


“This may sound trite, but we have basically embraced the notion of selling the customer[s] what they want,” Gooding says of the nonstop direct flights his airport offers to Continental Europe and Ireland. He adds that the benefits of countless connecting flights are overblown, and more energy should be spent on improving the quality of the travel experience for those whose final destination is Britain.

Airport alternatives


In London, business travelers revel in using City Airport, known for its efficiency, convenient link to public transportation and handy location—just six miles east of London’s financial center and less than two miles from Canary Wharf.

British Airways has taken note. Beginning next year, the carrier will launch the first transatlantic service out of City. Not surprisingly, the destination is New York’s JFK. Another unsurprising fact: The flights will be specially configured, with just 32 business-class flat-bed seats.

Gooding notes that the rejection of the hub concept not only makes City Airport attractive, but also plays a key role in the success of Britain’s low-cost carriers, Ryanair and easyJet, out of other airports. “For their own business reasons, they are delivering passengers from point to point. That is what the traveling public actually wants when they fly, whether it be for business or leisure,” he says.

Two objectives that are at odds

Alongside the push to provide enough runway space to maintain London’s status as a business powerhouse, we find the British government’s contrary goal of reducing its carbon emissions and discouraging air travel. “How do you square those two objectives?” asks Tim Johnson, director of the Aviation Environmental Federation, which deals exclusively with the impact of flying on the climate.

“The government has a very ambitious aviation expansion policy, and an ambitious energy policy of 60–80 percent reduction in carbon emissions,” Johnson says of the widespread debate about reducing air travel just as Britons are taking to the skies in record numbers.

Government data released in May 2008 reveals that air-passenger traffic increased by 54 million in the past five years, with British airports now seeing 235 million passengers a year.

Despite the “open for business” side of the argument made to justify more airport capacity, Johnson points out that the government’s own figures show that 80 percent of passengers are leisure travelers.

Stewart Barr, a professor of human geography at the University of Exeter in southwest England, has studied British attitudes toward flying, especially concerning the use of low-cost carriers, as part of a government-funded project. He found that even people who make every effort at home, conserving energy and embracing recycling, seem to check their green credentials along with their suitcases when it comes to flying.

“Those people with very strong environmental habits at home did recognize the contradiction, but still persist in traveling,” he reported, leading one tabloid newspaper to label them Eco-Hypocrites.

Barr notes that while the environmental impact of flying and talk of “carbon footprints” sparked debate in the mainstream British media years before gaining a toehold in the United States, Britain has done very little to change its habits. “Holidays are supposed to be separate from everyday life, and we found that people see going on holiday as a chance to really treat themselves,” Barr says of most people’s refusal to eschew air travel.

Barr’s study also found that—in contrast with the popular belief that low-cost carriers have enabled more lower-income Britons a chance to enjoy sunny vacations in Europe—the reality is that cheap carriers instead help middle-and upper-middle-class citizens to enjoy even more international leisure trips.

The end of business travel as we know it?

Finding a compromise between the desire to green our travel habits and the need to accommodate big business is Paul Tilstone’s job. As the executive director of the Institute of Travel Management, Tilstone represents the biggest corporate buyers of travel services in Britain.

The institute runs Project Icarus, an initiative that works to encourage businesses to take a leadership role in reducing their carbon footprints through the use of videoconferencing instead of traveling for face-to-face meetings, as well as choosing airlines that employ more fuel-efficient planes.

“As the environmental tide starts to become much more ingrained, it will be easier to have those conversations with clients about not coming to see them,” Tilstone says of the increasingly mainstream nature of the debate. He adds that the current economic downturn may even bolster the initiative by forcing travel budgets to become tighter, while employees must seek alternatives to their former travel schedules.
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CAROLINE MALLAN is a freelance writer in London.