London City Airport
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- Hartmann Rd
- United Kingdom
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- Other airports serving London
- London Biggin Hill Airport
London Gatwick Airport
London Heathrow Airport
London Luton Airport
London Northolt Airport
London Stansted Airport
- 1508m x 46m
- Airlines currently operating to this airport with scheduled services
Aurigny Air Services
- Airlines currently operating to this airport via codeshare
- Aer Lingus
All Nippon Airways
KLM Royal Dutch Airlines
London City Airport serves the London financial district and is a major business aviation facility. The airport is located on a former Docklands site three miles from Canary Wharf and six miles from the City of London. The only airport actually within London, London City is the fifth-largest airport serving the city and its operations are restricted to STOL (Short Take Off and Landing) aircraft. The airport serves over 30 business centres across Europe and North America and a small number of leisure destinations in Europe.
Location of London City Airport, United Kingdom
Ground Handlers and Cargo Handlers servicing London City Airport
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Fuel & Oil Suppliers servicing London City Airport
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766 total articles
37 total articles
There are few commercial airports anywhere in the world that can genuinely be referred to as ‘downtown’ airports and fewer still that are STOL ports (short take-off and landing) only. The recent sale of London City Airport to a consortium including the Canadian pension fund OMERS, has focused attention on these airports. This is because OMERS is also an investor in the Billy Bishop Toronto City airport in its home base of Ontario, Canada, through an investment by its infrastructure division Borealis Infrastructure in Porter Aviation Holdings. Porter Holdings manages the terminal there through a sale and leaseback deal. It may be the only example of one investor having equity in two of these airports.
Apart from ownership commonality, the other thing that links these two city centre airports is politics.
This report examines the relative attributes of these almost unique airports by reference to a range of statistics. It seeks to contrast the two of them from an operational, political and investment perspective, ultimately posing the question: which of them actually is the better investment.
On 9-Feb-2016, British Airways announced the addition of London Stansted to its airport network from May-2016. It will be BA's fourth London airport after Heathrow, Gatwick and City. At first glance, this move does not appear significant. BA's four leisure routes from Stansted will make it the airline's 196th biggest airport, taking just 0.03% of its 2016 summer peak seats (week of 1-Aug-2016, source: OAG).
However, BA's decision is noteworthy for one simple reason. More than any other airport, Stansted has been synonymous with the rise of LCCs in Europe. The scourge of legacy airlines across the continent, LCCs contributed to BA's near-death experience in the years after 9/11, when it fell into loss. The most successful LCC incarnation, Ryanair, has more than 80% of seats at Stansted.
Just a few years ago, during the global financial crisis, BA was again loss-making and would not have had the temerity to enter Ryanair's stronghold. Now, emboldened on the strength of its highest ever operating margin in 2015, BA seems prepared to take on all comers. It is taking only a very small step into Stansted, but every journey starts with a step.
For several years there has been a sideshow to the debate about whether or not there should be additional runway capacity at London Heathrow or Gatwick airports. Or whether the UK should simply make do with what it has got. In Jul-2015 the Airports Commission came down in favour of Heathrow but the issue seems to be so difficult for the British government that it has become incapable of making a decision.
This policy vacuum has elevated to the level of possibility a suggestion that was impossible when first aired; namely that a rundown military airport a few miles north of Heathrow in a suburb called Northolt might be used as a proxy domestic runway for the ‘country’s only hub airport.’ It was dismissed almost out of hand by the Commission.
But the longer the debate goes on – and it shows no sign of abating - the stronger is the hand held by the proponents of this apparently madcap idea. If the government announced tomorrow that an additional runway was to be built – and assuming it gave the nod to Heathrow – it would be 10 years at least before it entered service. Meanwhile, say commerce and industry, critical air connections from the British regions to ‘emerging markets’ are ‘missing.’
One airline – Flybe - seems to have come on board latterly and appears prepared to put its money where its mouth is. This report looks at the history behind the proposal, the pros and cons, and how realistic it is today.
After years of speculation it seems as if Global Infrastructure Partners (GIP) is set finally to dispose of London City Airport (LCY, to give it its IATA code), one of the world’s few facilities that caters in the main to business travellers, and where it is a 75% shareholder.
The airport’s ownership has changed twice already, during a period when it progressed from being something of a gamble to a successful money earner to a pawn in a political game. But the reasons for the disposal are not yet readily identifiable and can only be surmised.
LCY, which was originally going to be called London Churchill Airport after the wartime leader, serves the London financial district and is a major business aviation facility as well as supporting commercial scheduled flights. The airport is located on a former Docklands site three miles from Canary Wharf and six miles from the central business district, the City of London, which is in the east of the wider downtown area, accessible by the London Underground in 22-25 minutes.
In a May-2013 report on British Airways, we called it the favourite child of parent IAG. Its good behaviour was being rewarded with new fleet toys, while sister Iberia was scolded to mend its ways.
BA should match its best ever operating margin in 2015 and better it in 2016, even covering its cost of capital - a salutary model for its European counterparts. After the global financial crisis, margin recovery was mainly due to unit revenue growth. A RASK downturn in 2014 and 1H2015 has seen margins improve through lower unit cost, but these were largely thanks to lower fuel prices. Even a premium brand cannot always rely on unit revenue growth and BA still needs to cut CASK, with a focus on labour. It remains one of Europe's higher unit cost airlines and Iberia has cut CASK more successfully.
Iberia's reformed ways have been feted like the return of the prodigal and now BA has two more siblings. Up and coming teenager Vueling has been given significant trust and responsibility for one so young, while new arrival Aer Lingus will demand much parental attention. BA will need the maturity and determination of the eldest child to graduate to full value-creating adulthood.
Flybe reported a pre-tax result for FY2015 in line with expectations, confirming that its restructuring is starting to have a positive impact. Confusingly, the reported FY2015 result fell into loss after having recovered in FY2014, but this was blurred by a series of non-recurring/non-operating items. Flybe also reported what it calls an "illustrative" pre-tax result, by which measure its profit grew and this more closely reflects the progress made under CEO Saad Hammad.
Passenger unit revenue grew, driven by capacity cuts and sharp load factor gains, stimulated by falling yield. However, revenue from contract flying and charter operations fell and the increase in underlying profit owed much to unit cost reduction.
Flybe also signed a contract flying agreement for SAS and sold its stake in its Finnish joint venture. Moreover, it made progress with a number of other legacy issues, including exiting from its Embraer E175 order and securing additional used Bombardier Q400 aircraft. A key outstanding issue is finding a solution to its surplus E195 aircraft. In FY2016, it must aim for an improved result without having to rearrange the numbers.