Gatwick Airport Blog

Citigroup and Vancover Airports Authority plan joint bid for Gatwick

2008-10-30T14:40:07Z

The infrastructure arm of Citigroup, the American banking giant, has joined forces with Vancouver Airports Authority in an attempt to make a successful bid for London’s Gatwick Airport. The British Competition Commission announced earlier this year that the British Airports Authority must sell three of its airports and the bid from Vancouver and Citigroup, estimated at over $3 billion, is just one of several expected to be announced over the coming weeks.

Some bids have already been made public. Virgin Atlantic Airways, Hochtief AG (a German construction company), Fraport AG (the operator of Frankfurt airport), RREEF Alternative Investments (the infrastructure arm of Deutsche Bank AG) and Manchester Airports Group have all expressed interest in acquiring the airport.

Gatwick is the second biggest airport in the United Kingdom and the world’s busiest single-runway airport. Approximately 35 million people used the airport last year and the chief executive of the British Airports Authority, Colin Matthews, has spoken about the disappointment felt by those who had to make the decision to sell the airport. Matthews revealed that Gatwick had “long been an important and valuable part of BAA”.

Vancouver Airports Authority and Citigroup have worked together before successfully. Citi Infrastructure Investors, a unit of Citigroup, was handed a 50% stake in Vancouver Airport Services, which operates eighteen airports in numerous countries, earlier this year. Just last month, Vancouver Airports Authority was handed a contract worth approximately $2.5 billion to operate and further develop Chicago’s Midway Airport. This deal was carried out in accordance with Citigroup and John Hancock Life Insurance.

Replica bomb missed at Gatwick

2008-10-29T13:35:41Z

A recent inspection by the European Commission has revealed worrying security lapses at Gatwick airport. Staff there failed to spot a replica bomb hidden in an inspector’s hand luggage and fears have been expressed that the need to keep queues to a minimum may be compromising passenger safety. Under rules introduced in March, the airport authorities can be fined if queuing time at security is regularly five minutes or more. A follow-up test is due to be carried out within the next week.

The replica device was apparently flagged up by the scanners and the bag searched but it was then returned to the inspector because the member of the security staff did not realise what it was. According to an unnamed airport source, there is so much emphasis placed on searching for liquids that the basics are often overlooked. The same source also believes that computer generated images of banned items can cause a distraction for security staff. Experts in the field claim that because explosives are organic, it is often difficult to detect them and that staff have to concentrate on finding extremely small items such as timers, wires and detonators, which makes their job more difficult.

Several years ago, inspectors succeeded in getting fake guns and bombs through security at both Manchester and Stansted airports. A spokesman for BAA refused to confirm that the replica bomb had not been spotted although he was able to confirm that the inspection had taken place. The European Commission was no more forthcoming, refusing to discuss their findings.

Virgin Atlantic to buy Gatwick Airport

2008-09-26T13:17:31Z

Richard Branson’s Virgin Atlantic Airways have made it abundantly clear that they are interested in purchasing a stake in London’s Gatwick airport as part of a scheme to encourage an extensive restructuring of both conventional airports and the aviation industry as a whole. The news comes after the Competition Commission ruled that the British Aviation Authority (BAA) held a monopoly over British aviation and must relinquish up to three of its airports to the highest bidder.

Virgin Atlantic is one of the largest and most profitable aviation companies in the United Kingdom, earning an average of around £47 million a year. The company was founded in 1984 and has vied for supremacy over aerospace colossus, British Airways, ever since its inauguration. Richard Branson and Virgin Atlantic spokesperson Paul Charles have long petitioned for a complete re-think of the way airports are run, with the latter hopeful of a system that would allow airlines to operate airports independently. “It would make the experience for passengers so much better than it is today” Mr. Charles said.

The airline has expressed that it would only be interested in purchasing the airport as part of a consortium of other airlines but some groups fear that repackaging airports as a corporate plaything may jeopardise passenger safety. While the number of companies involved in the deal is still a matter of conjecture, some reports indicate that groups as diverse as the Dubai royal family may be persuaded to part with their cash for a slice of Britain’s second largest airport.

The proposed deal is still in an embryonic state but the total cost is expected to reach £3 billion.

XL Leisure Group collapses

2008-09-16T15:02:31Z

The XL Leisure Group, which not only runs its own airline but also various tour companies, went into liquidation on Saturday, leaving 85,000 holidaymakers stranded abroad, some 200,000 facing the loss of their holiday and 1,700 staff without jobs. XL was the third largest travel company in the UK and is the biggest to go bust in twenty years.

It flew to 50 different countries, mainly in the Mediterranean, from 12 UK airports, although most of its flights operated out of Gatwick, Manchester and Glasgow. The company blames its demise on the rising cost of fuel, the general economic gloom and the inability to raise capital.

Although the CAA has been working hard to repatriate stranded Brits, many on specially chartered planes, those who had not booked a package holiday were less fortunate. With the ATOL protection not applying to separately booked flights and hotels, holidaymakers were very much on their own and many were facing hefty bills to fly back to the UK. Rival operators were accused of exploiting the situation, with huge hikes in prices for those trying to book alternative flights.

The demise of XL comes in the wake of trans-Atlantic carrier Zoom going into administration last month and the business-class carriers, Silverjet, Eos and Maxjet going out of business earlier this year. Meanwhile, Willie Walsh of BA warned that up to a further 30 airlines may go bust before the end of the year.

The Telegraph newspaper offered advice to holiday makers on how to safeguard their money, and gave details of the type of help that travellers could expect, depending on how they had paid and the insurance cover that they had taken out.

The Travel Insurance Guide has recommended a list of travel insurance providers who will cover you for the financial failure of your airline or accommodation provider. With the current economic climate, this is vital, so make sure you check it out before booking your essential travel insurance.

Pay deal saves UK airport strike

2008-09-05T10:38:41Z

Strike action always comes at the wrong place and the wrong time but then that’s half the point. Last month the aviation industry here in the UK was saved from what could have been another total disaster, one they could have certainly done without, given their current rocky period.

Back at the beginning of August, baggage handlers and check-in staff at Gatwick and Stansted threatened to go on strike over the August bank holiday, which would potentially have caused major disruption for over 400,000 passengers. The staff of Swiss based firm Swissport were in dispute over pay and rejected a 3% pay rise. Although the airlines claimed they would have an adequate contingency plan in place to cope with the loss, nothing would be quite sufficient and, after the debacle at Heathrow this year things might have gone from bad to worse.

But talks were held and finally deals were done and the staff, who would have affected flights on some of the busiest airlines such as Ryanair, Virgin and easyjet, finally accepted a 4% offer that would be back-dated to April 1st. Unite, the union representing the workers, has announced that workers of Swissport will be pleased that this has been resolved with their demands being heard without the need for major hold-ups. There were fears that the strike would seep into Manchester and Glasgow too, but this too was fortunately avoided.

Branson has his eyes on Gatwick

2008-09-05T10:32:42Z

BAA is to airports what Coca-Cola is to the soft drinks industry: it pretty much owns the lot. All the big airports such as Gatwick, Heathrow, Stansted, Manchester, Glasgow, Aberdeen and more, are owned by the giant firm. However, things might all be about to change and the disastrous year that the aviation industry has had in the UK might be about to knock the school bully off his perch.

The muscle that BAA yields promoted an investigation from the Competition Commission, which concluded that such a monopoly on the industry was not healthy and that it might be forced to sell off some of its airports. This immediately set the business world alight and none more so than in the camp of that national treasure, Sir Richard Branson.

Branson is the ultimate risk-taker in terms of new business deals and has always been the same, irrespective of the millions in the bank. He pricked his ears up when Northern Rock were in trouble and now he’s pricking them up again with BAA. It’s not a bad idea to have one of the privately owned airlines in control of the airport; after all, they know the most about what passengers want and don’t want on a day to day basis.

The concern though is that such a deal from Virgin would mean we go from one monopoly to another. If Virgin owned Gatwick, then many of their rival airlines might worry that Virgin Atlantic would dominate the runways. However, Gatwick is big enough to be divided up and split amongst the airlines and this might end up being the best solution to the problem.