By Daniel Hunter
The UK risks missing out on billions of pounds in trade unless it boosts direct flights to the fastest growing world economies, according to the CBI.
New analysis published today (Monday) by the UK’s leading business group, reveals that adding just one additional daily flight to each of the eight largest high-growth markets would increase UK trade by as much as £1billion a year, with every increase in 1000 passengers generating up to £920,000 in new business.
In the report, Trading Places, the CBI warns the UK is failing to keep pace with major European competitors in winning new direct connections to Brazil, Russia and China, hitting long-term export potential, damaging competitiveness and deterring inward investment.
The CBI is calling on the interim report of the International Airports Commission — led by Sir Howard Davies — to support a thriving aviation network by proposing urgent investment in the poor road and rail links to the UK’s international airports, as well as taking action on hub capacity.
Katja Hall, CBI Chief Policy Director said: “Boosting exports is critical to our long-term growth. Our analysis shows that just one new daily flight to the eight fastest growing economies in the world could generate as much as £1billion a year in trade.
“Every day we delay expanding our connections, we risk falling further behind our competitors. Firms in high-growth economies are not waiting for us to make a decision before taking their business to countries with much better flight links.
“For too many businesses, our lack of direct connections means selling abroad to the fast-growing markets is simply not a realistic option. Firms need frequent direct flights to the widest range of markets.”
The interim report of the Davies Commission reports later this year and the full report is due in 2015.
Rhian Kelly, CBI Director for Business Environment policy, said: “The Davies Commission must be bold and set out a clear path forward. It needs to provide all of our airports with a sustainable licence to grow, with the ability to link exporters with new opportunities. This means tackling the growth pinch-points in the air and on the ground.
“Without convincing plans on aviation capacity, we risk wasting time circling, while our competitors cruise ahead.”
The CBI is calling for:
Short-Term (by 2020)
Immediate improvements in surface access to UK airports, maximising efficiency for passengers and freight and boosting the catchment area of the UK’s international airports. This should include:
- Pressing ahead with delivery of announced measures such as the western rail link from Heathrow and the station upgrade at Gatwick
- Concerted efforts to address pinch-points in road access to the UK’s network of regional airports including East Midlands, Newcastle and Bristol
Maximising capacity of existing assets if commercially viable, with more flexible ‘mixed mode’ operations at Heathrow.
Medium-Term (delivering in the 2020s)
New runway capacity in the south of the UK — at Heathrow, Gatwick, Stansted, Birmingham or elsewhere — subject to review of the most feasible option to address current constraints at Heathrow.
A strategy to increase public transport access to UK airports from 40% to 60% by 2030, supported by new rail links to improve access to key airports such as links to Manchester through a new Northern Hub.
Long-Term (to deliver from 2030)
Explore all options for expanding hub capacity in the South East, including a new airport for London, to meet long-term demand for passenger and freight and support trade growth with new emerging markets. A successful hub must include:
- Sufficient runway and terminal capacity to accommodate future demand projections, domestic flight connections from UK ‘spokes’ and headroom to ensure resilience.
- Excellent connectivity to London and the wider UK transport network, including motorway and high-speed rail links.
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