Airports

Expanded Heathrow’s value to rest of UK is hazy

6 June 2018

Europe’s busiest airport has tried to placate critics of a third runway by incentivising flights to smaller UK cities. But large airlines will struggle to make these stack up. Unless budget players can do so, the charge that Heathrow only works for London will be hard to refute.

Air India fix would give Modi reform miles

21 July 2017

The carrier is a travelling advertisement for India's inefficiencies. It has made losses for nine years and turnaround efforts have failed. A sale may push a multi-billion dollar writedown on lenders, but would validate Prime Minister Modi's reform credentials.

Richmond sharpens up Britain’s Brexit divide

2 December 2016

The victory of a pro-EU liberal in a UK local election hints at a potential swing back to the centre. Stronger opposition could keep the government honest as it negotiates Brexit. Yet Richmond is wealthy, and voted strongly to stay in Europe. More clarity doesn't mean more unity.

Britain joins China in investment limbo

1 July 2016

Heathrow Airport's expansion is on hold. Now the UK has voted to leave the EU, controversial or financially demanding decisions may be left dangling. There's a precedent in China, where a graft purge led to widespread dawdling. British inertia could be much tougher on growth.

Who’s London’s next mayor? It doesn’t matter

5 May 2016

Neither Sadiq Khan nor Zac Goldsmith, frontrunners for May 5’s vote, have the tools to fix London’s housing shortage. That’s a national issue. The question for businesses isn’t who runs the capital after Boris Johnson, but whether expansion elsewhere in the UK makes more sense.

Who pays for London City Airport’s golden ticket?

2 March 2016

The financier’s hub of choice has been bought for 2 bln stg by a group including Ontario Teachers’ Pension Plan. The price, about 30 times 2015 EBITDA, implies the airport needs to double its passengers to make decent returns. Or it can hike prices – and annoy its own customers. 

Heathrow offers useful dry run for Brexit debate

11 December 2015

David Cameron has deferred a decision on airport development around London. One business group called the move “gutless”. But expansionists haven’t yet convinced the populists. As with the UK’s looming poll on EU membership, it will take more than economics to win over voters.

LaGuardia gets a refreshing clearance for takeoff

28 July 2015

One of the worst U.S. airports, in the country’s financial hub, is finally slated to be rebuilt, by 2021. At least $4 bln of funding will be public, private and local, but Washington played an important advocacy role. Absent a nationally led effort, it’s a decent model to follow.

Heathrow offers quaint lessons in infrastructure

1 July 2015

After at least six years of heated debate, a British government-appointed panel has backed the idea of a third runway for London’s largest airport. China has built 44 new airports in that time. The UK’s deliberative approach has advantages, but now it’s time to start building.

TCI picks high-stakes fight in Spain

5 June 2015

Chris Hohn’s fund, the largest private investor in airport group Aena, is joining the company in challenging what it thinks is a misguided antitrust authority. Antagonising the supervisor is risky, but the accounting dispute puts more than 1 billion euros of value at stake. 

BA owner flies in no-frills bid for Aer Lingus

27 May 2015

The Irish government has backed British Airways’ parent in its 1.4 bln euro offer for Aer Lingus. The 40 pct premium is less generous than it looks, given the wider rise in airline shares. Key shareholder Ryanair could push for more, but other investors shouldn’t bank on it. 

Heathrow upstarts have London’s best airport plan

4 February 2015

A new runway may be finally built near the UK capital at a cost of up to $28 billion. The three rival proposals all seem to be financially viable, but the independently conceived scheme that would double the length of one of Heathrow’s existing runways looks best placed.

Ryanair finds it harder to get “always better”

2 February 2015

Europe’s largest low-cost carrier upped its fiscal-year forecast again, eyeing a 60 pct net profit jump. But sober days lie ahead. Hedges limit the impact of lower oil prices. Other costs will rise. After gaining nearly 50 pct lately, the richly valued stock looks vulnerable.  

Etihad’s Alitalia grab not as loony as it looks

2 June 2014

After spending another 300 mln euros on struggling Air Berlin, the Abu Dhabi carrier gives Italy’s stricken flag carrier another lease of life. Acquiring yet another minority stake in a loss-making peer does make sense. And Etihad buys much-needed political clout in Europe.

HS2 train decision must wait for Heathrow 2015

4 July 2013

The HS2 high-speed rail project is under fire as cost estimates mount. But that is not the only problem with this massive project. A financial commitment now would pre-empt the 2015 report on airport strategy. Better to wait and not box the country into keeping the Heathrow hub.

Record aircraft orders point to global growth bump

8 May 2013

When airlines embark on a frenzy of expansion, economic slowdown tends to follow. That’s the conclusion implied by Breakingviews’ study of historical data. If the relationship holds, recent big orders by Asian airlines suggest rising risks of turbulence in the economy next year.

Third airport sale may give London a lift

22 January 2013

Manchester airport’s owners are paying a surprisingly lofty $2.4 bln for Stansted, Heathrow’s neglected little sister. The bet hinges on utilising spare capacity. If passenger numbers double, as they could, the transformation would also ease London’s air traffic squeeze.

Heathrow needs decisive capacity fix

21 January 2013

Snow has exposed the London airport’s lack of slack when problems arise. Passengers’ expectations of a zero-failure service are hard to shift. But if Heathrow can’t build another runway, it needs to be radical. That may mean operating its infrastructure at lower capacity.

Airport mess shows limits of German expertise

7 January 2013

Berlin has delayed the opening of its high-tech airport - for the fourth time. The fiasco is all too typical of Germany. Ossified local politics and a penchant for over-engineering have led to many botched infrastructure projects. The legend of German efficiency is exaggerated.

Delta buys premium Heathrow seat for economy fare

11 December 2012

Being Richard Branson’s junior partner cost Singapore Airlines two-thirds of its investment in Virgin Atlantic. Delta, however, is buying the 49 pct stake at a discount to what slots at London’s premier airport usually command. That should help the new joint venture take flight.