Aeroflot is reportedly seeking compensation from BAA for losses the Russian national carrier suffered as a result of London Heathrow’s closure in Dec-2010 (Breaking Travel News, 07-Mar-2011). The airline has reportedly appointed London’s LK Baltica Solicitors to pursue the matter.
Aeroflot seeks compensation from BAA
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Chinese long haul secondary city air routes: BA's Chengdu exit does not reflect the broader market
The fastest long haul airline growth is not occurring with Gulf airlines but rather, with services to and from secondary Chinese cities. It is not a secret that local incentives and subsidies, generally common in any market, are especially large in price and duration for secondary Chinese cities. An airline might expect over a third of revenues to be subsidised. This drastically alters the business case in a low-margin industry, hence the proliferation of secondary city services. This extreme dependence on subsidies raises the question of how long governments are willing to issue generous subsidies, and how many routes can be sustainable without them.
British Airways' decision to exit its only secondary Chinese route to Chengdu, in Jan-2017, might suggest the music is ending and the secondary long haul bubble is popping. There is added colour given the recent UK-China air service agreement expansion, and Brexit/British pound depreciation overhangs.
BA's exit does confirm market fundamentals: secondary city yields are low, and some routes are ahead of their time. Yet a number of factors unique to British Airways suggest caution in concluding that BA's Chengdu exit could foreshadow other withdrawals.
South East England runway decision – UK Prime Minister Theresa May could select a radical solution
The end really does (once again) appear to be in sight for the interminable decision on where to approve additional runway capacity in the UK, with the choice down to two proposals at London Heathrow Airport and one at London Gatwick Airport.
Much has changed since the Airports Commission first began to investigate the matter, and it is now 16 months since its final report was released. Governments have changed, new personalities have emerged, and the UK has voted to leave the European Union since then.
Politically it is a whole new ball game, and while one of the two Heathrow options remains the favourite, an entirely new solution is not out of the question.