EEF survey highlights why manufacturers back Heathrow over Gatwick*

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For manufacturers expressing a business need for additional airport capacity 79% would prefer this to be at Heathrow rather than Gatwick.

 

*and it's not just about business trips.

The task facing the Airports Commission

EEF’s previous surveys have shown that most manufacturers would understandably prefer to see more international flights from their nearest regional airport. Our analysis showed that for most of these airports the size of their local market was the main barrier, not the issue of capacity. These local markets are not large enough to make flights to a range of destinations profitable for airlines.

EEF advocated the need for surface access improvements to these airports to enlarge the size of that local market to make flights more viable. This is something that the Airports Commission subsequently recommended.
The task facing the Airports Commission is to “examine the need for additional UK airport capacity and recommend to government how this can be met in the short, medium and long term.”

Their analysis of medium and long term need has resulted in three shortlisted options with expansion being proposed at either Heathrow or Gatwick.
This blog focusses on manufacturers preferences between Heathrow and Gatwick, and why.
On this question, our survey of member’s preferences on airport expansion shows that for those expressing a business need for additional airport capacity 79% would prefer this to be at Heathrow rather than Gatwick.

HeathroworGatwickmfgpreference

While a slight majority of respondents (53%) express no need for additional airport capacity, our previous surveys have shown that this group will be dominated by those who do not export and unsurprisingly do not need to make business trips or use air freight.

importanceofaviation

Our survey also indicates that the preference for Heathrow over Gatwick, for those who see a need for additional capacity, exists across all English regions and Wales and for every size of company and every sector in our survey.

Manufacturers prefer to build on success

whyHeathrowispreferred

As the chart above shows some of the key reasons are the frequency of flights, range of destinations served and choice of airlines.

This indicates a number of things, most importantly an airport that best supports the hub and spoke model is preferred. As the International Transport Forum noted in their technical report to the Airports Commission, hubs are "a means to optimize society’s global accessibility" by connecting regional airports to wider long haul networks while optimising the ‘wave-system structure’ of arriving and departing flights in an airline alliance.
This perhaps explains why Aberdeen, Glasgow, Leeds Bradford, Liverpool and Newcastle airports have all publicly expressed a preference for Heathrow expansion as the right choice for the whole country.
In the chart above, ease of road access to Heathrow scored highly as well. Heathrow's location on the strategic road network makes it more accessible to the South West, Wales and Midlands than Gatwick for, among other things, freight access.

Lastly, the number of companies saying the proximity of Heathrow is a reason for them backing expansion there indicates that some manufacturers may have chosen their location on the basis of access to Heathrow.

Does it even matter?

EEF believes that making the economy more resilient to future shocks requires a focus on better-balanced growth driven by increased exports, investment and productivity. Aviation is a key foundation to this, not just for business trips but from a trade perspective too.

Increasing UK exports is crucial. Manufacturers are more likely to report an increase in productivity and profitability at the firm level as their export intensity increases. Competing internationally drives competitiveness and efficiency helping to push the economy toward better balanced growth.

EEF's surveys have also shown that the more a company exports, the higher the priority they place in investment in aviation compared to other transport networks.

prioritiesforinvestmentbyexportintensity

For a range of business activities.

importanceofaviationforarangeofactivities

Heathrow is Britain's busiest port by value of goods, serving as a gateway for high value low weight goods. The key advantage for Heathrow is bellyhold cargo capacity on long-haul passenger flights. As the chart below shows, Heathrow's role in air freight is dominant.

shareoffreightfromairports

Since 2003, freight changes amongst these top 5 airports have shown a decline in volumes at Gatwick and Manchester. There are a number of reasons for this, the most important of which is the shift away from short haul air cargo toward road freight and the Channel tunnel. Additionally, the growth of the low cost airline operating model in 2003 which relies on fast turnaround times (thus reducing the possibility for air freight), also played a part.

trendinairportfreightsince2003

As a result it is perhaps unsurprising that our survey also indicates that the more manufacturers export via air, the more they prefer expansion at Heathrow over Gatwick.

 

Author

Head of Business Environment Policy

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