Booming LCY

London’s very own City airport (LCY) is on a roll with record passenger numbers and a growing network of flights. Says Richard Gooding, the airport’s MD, “We handled 220,000 passengers in June which is a record. This year overall we’re hoping for 2.4 million passengers.”

LCY has opened four new routes in the past few months (Newcastle, Stockholm, Milan Malpensa and Stuttgart) and Gooding reveals that the Star Alliance group of airlines are now the number one users of his airport. Previously the biggest customer was the Belgian airline VLM.

Gooding believes that a substantial number of LCY passengers are now using the DLR (which opened last December) to travel to and from the airport. “While I don’t yet have any accurate figures for the DLR, we believe that half of all our passengers are using it. For example, our car parking business is down by 5 per cent even though passenger numbers are 20 per cent up and it’s noticeable that the local roads aren’t as jammed up as they were before.”

The main jet aircraft using LCY is the BAe146 which is no longer in production. The airport is looking to safeguard its future by seeking approval for other plane types. Gooding reveals that the Brazilian-made Embraer 170 jet will be cleared to use LCY by next year with the Embraer 190 jet probably cleared in two years’ time.

But the biggest news concerns the Airbus A318 (see Online news, May 18) which is expected to be cleared by Spring 2007. “It means,” says Gooding, “that with the A318 we’re moving away from regional jets to something more grown up.”

The A318 would enable non-stop flights to be operated to cities like Madrid (currently the airport’s most requested destination), Vienna and various ones in Eastern Europe.

LCY’s growth has put parking space under pressure. “100 per cent of our capacity is now used at peak times,” says Gooding, “any airline coming to us now will only get a 30 minute slot [on the ground] which means the actual parking time is [limited to] 25 minutes. But this is good business practise because, a) we can get more aircraft in and b) the airlines can operate more flights so their [aircraft] utilisation is better.” LCY is seeking to add more parking space to cope with future demand.

The airport is currently owned by Irish entrepreneur Dermot Desmond and he has put LCY up for sale. Says Gooding, “He [Dermot Desmond] bought the airport 11 years ago for £23.5 million of his own money at a time when nobody wanted it. [At that time] Canary Wharf was bust and the UK economy wasn’t doing well.”

“We are now of a size when we have outgrown a single shareholder investor. There has been a lot of interest in LCY and a number of bids [a figure of £400 million has been rumoured in the financial press]. But whether we sell will depend on what offers come along and the credibility of the buyers.”

For more information go to londoncityairport.com

Report by Alex McWhirter


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