London’s Airports Battle for Premier League Positions

16 September 2020 / by John Grant

Changing Strategies for the New Normal World

There are few cities in the world that offer as much airport choice as London; five major airports and a sixth if you include what was the UK’s fastest growing airport in Southend. Airlines and travellers might have been spoilt for choice but Covid-19 has resulted in airlines rapidly changing strategies. Increasing competition and a global pandemic has changed both the current role and future position of each London airport and in some cases perhaps their very future.

Taking the yearly journalistic spin on who will win the Premier League (not Brighton) and who will be relegated (not Brighton) we’ve reviewed the line ups for each of the major airports and made a few predictions for the coming years.

London Heathrow – Squad Expansion Unnecessary – let’s kick the obvious into the stand straight away; a third runway is now an unlikely acquisition in today’s climate as the current two have plenty of capacity to offer for the foreseeable future. Consistently producing yields that its rivals cannot match, London’s best-connected airport will attract airlines even in the hardest of times; even if some of them are likely to never reach the first team squad.

Quick tactical changes by British Airways and Virgin Atlantic resulted in them moving what services they are operating from Gatwick to Heathrow as soon as practical. Both airlines body swerved the key question of when they would return to Gatwick, but the reality is that a move to Heathrow was a “dream opportunity” for both and they are unlikely to ever return to Gatwick in the same shape or size.

Heathrow’s major challenge will be the increasing range of direct services from markets such as the United States to Africa and the Indian Sub-Continent; they were key connecting flows via the airport and both United and Delta Air Lines are seeking to lure that traffic to new non-stop services. In 2019, just over one million bookings included a connection at Heathrow; no airline can afford to lose that many passengers or revenue.

Key Strengths

185 airport pairs, 82 scheduled airlines, strong yields & business class demand, very well connected

Key Weaknesses

Limited scope for growth in a normal season, potential erosion of connecting traffic flows

London Gatwick – New Season, New Orange Kit – every season sees a change of kit and a £50 bill for following fans; this year Gatwick have broken with tradition and gone for a very bright Orange. We can’t imagine why. Easyjet are now the dominant force and provide a great range of destinations throughout Europe.

Having lost a number of star carriers through no fault of their own the airport will backfill with more orange and a smattering of purple at the edges will wizz up some exciting new destinations from carriers eager to establish their positions at the only major airport south of the city. Gatwick has a very strong fan base living around the airport that regularly visit one of the two terminals and their loyalty will mean that demand will pick up quickly if the airport can pick up an few quick wins in the new normal world with Wizzair keen to grow.

It may be a long haul for Gatwick to recover some of the more attractive carriers that had previously played at the airport, but those connections will return at some point.

Key Strengths

Able to attract leading European LCC’s, strong local market support, capable of reinventing the market position

Key Weaknesses

Always comes second to LHR, long-haul leisure vulnerable post Covid-19 attack.

London Stansted – Home to The Crazy Gang – think Stansted and you think of their star player Ryanair, crazy on occasions but an extremely powerful value for money player that attracts millions of passengers a year with their route one tactics; no tippy tappy here! With a 74% capacity share in 2019 there’s no need for Ryanair to play an expansive game just go from point to point.

Increasingly attracted by offers of more space and an expanded role at Gatwick, team Orange are likely to move more capacity across to Gatwick, an airport that offers both high yields and a larger fan base. Any departure of easyJet capacity will provide space for the up and coming Jet2 network from Stansted and with their successful Jet2 Holidays brand they will make sure it’s no vacation for Ryanair once easyJet’s attention drifts towards the attractive offers being made from Gatwick.

Key Strengths

Very powerful attacking line up with a Europe’s largest airline dominant. Developing tour operator market with strong UK based airline

Key Weaknesses

Very strong base airline creates fear for other carriers, seen as essentially a LCC market.

London Luton – Training Hard but May Fall Short – locals have been impressed by the recent investment in a direct train link from the station to the airport and of course the memorable Thameslink service.

With a stable team of airlines, the airport should have a solid future although filling the new terminal space and delivering on the owners’ expectations may be challenging in the next couple of years. Luton’s ambition remains built around staying in Europe, with 25 new airport pairs added between 2016 and 2019. With regional markets expected to recover first that may offer hope for a faster recovery than others.

Key Strengths

Well connected to the capital market, increasing awareness across emergent European markets

Key Weaknesses

Scope for long-term growth, local fan base not high frequency visitors to the ground

London City – A Star Studded Line Up – the yearly team picture always includes the Stars with all of the majors present although in many cases sending smaller partners to operate on their behalf. With every major European legacy airline serving the airport one-stop connectivity to every major commercial centre is less than 20 minutes from Canary Wharf; if there is a financial community left after Covid-19!

Having developed an exclusive list of airlines the airport has a small club feel to its operations and that has allowed the airport to create a very successful position that attracts thousands of away fans destined for the bright lights of Canary Wharf. The increasing use of video technology may dampen some of that interest from away fans, but the exclusive location of the airport means it will recover its prestigious position in time.

Key Strengths

Imperious line up of star studded airlines, high yield traffic and very frequent visitors to the ground.

Key Weaknesses

Local fan base appears small and seems to prefer supporting other airports in London.

London Southend – A Survival First Strategy – losing 80% of your squad through no fault Southend have to be focussed on survival this season and indeed for the foreseeable future. And when the one remaining airline is renowned for their confrontational style with airport management teams Southend’s defence will be vulnerable this year and unless a few quick wins can be achieved any recovery will take a long time.

Key Strength

Plenty of available capacity

Key Weakness

Plenty of available capacity

The coming season looks like it will be the hardest for many years for all London airports and rather like the Premier League it’s frequently not the battle for a top four position but who will get relegated that grabs the most attention. Of course, no airport can get relegated but there will be winners and losers in the post Covid-19 shakedown and as is frequently the case the big boys are likely to be the winners.

 

Webinar Series: up to date insights with industry experts

Topics: Airports, Coronavirus, COVID-19

John Grant

Written by John Grant

Subscribe to our blog

data-changing-flight-planning-image-2

HOW AND WHEN WILL AVIATION RECOVER FROM COVID-19?

Find out more

data-powering-airports-image-2

LISTEN TO OUR LATEST on air AVIATION PODCAST

Find out more

data-driving-traveltech-image-2

CONSOLIDATION STARTS IN SOUTH KOREA WHEN TWO BECOME WON...

Find out more