Serious about manufacturing? Get serious about airport expansion

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Airports matter to a global sector like manufacturing. They facilitate face to face interaction required for a range of business activities and support global trade. Creating and maintaining air links is important if the UK is to remain globally competitive.

 

Our previous surveys have shown that the more export-intensive a company becomes, the more critical airports become to their operation.

aviationbyexports

Similarly, UK owned companies with an overseas subsidiary say aviation is critical to their business.

aviationbyownership

Today the Airports Commission published their initial analysis on the three shortlisted options for additional runways that would ensure Britain creates and maintains the air links that are needed in the future.

An extended northern runway at Heathrow, a new north west runway at Heathrow or a second runway at Gatwick.
EEF intends to respond to this consultation to put across the view from manufacturers however it is encouraging to see at this early stage the Commission make clear the benefit of expansion to the manufacturing sector. The gains from expansion, according to the Airports Commission, include:

Increased employment
With the largest gains being in trade intensive sectors such as manufacturing. This is something expansion at either three options would bring.

Increased exports, particularly in intermediate goods
Due to reduced country to country trade costs as a result of more destinations being served more frequently. Again, this is something expansion at either three options would bring. Our previous blogs have looked at the range of goods exported by air.

A boost to GDP
Due to increased international competitiveness and ultimately productivity. Expansion at Gatwick would see the manufacturing sector being 1.5% larger by 2050 against the baseline and at both Heathrow options 2% larger by 2050.

Finally, a boost to the freight industry on which manufacturers looking to export heavily rely
Expansion would support the ability to get to more customers and destinations, more quickly. Expansion at Gatwick would see the freight industry being 1.4% larger in 2050 against a baseline, 3.7% larger with the Heathrow runway extension option (with benefits for the whole freight distribution network) and 3.8% larger with a new north west runway at Heathrow, with similar benefits for the whole freight distribution network.

These are just some of the main reasons why, as part of our Agenda for Government to 2020, we’ve highlighted the need for the next Government to implement the recommendations of the Airports Commission after the next election.

The current Government was right to set up the Airports Commission, separating the analysis of need from a final decision is one we support and would like to see expanded to other infrastructure sectors.
The message to political parties is clear, if you are serious about growing manufacturing and boosting exports, you have to get serious about airport expansion.
To ensure this issue of economic importance doesn’t drift, we are calling on the Government to make the Airports Commission permanent until the Government enacts its recommendations in the next Parliament.
 

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