Let’s fly to space!

As we all know, tourism is growing rapidly and is developing new products and new trends every year. It is hard to keep up sometimes! Space tourism is one of those exiting new trends. Ever since 1996 there has been a great interest in developing new spaceships and new spaceports. This was enhanced by Philip Diamandis who created the X price (later known as the Ansari X price). This price is worth $10 million for the first non-government organization to launch a reusable manned spacecraft.

This competition has led to Richard Branson starting a new business: Virgin Galactic. Even though space tourism is fairly new, he registered his company in 1999 and has been inventing commercial spaceships for over a decade now. In 2005 people were able to put in a $200 000 deposit to fly to space and Virgin Galactic managed to collect $10 million in a matter of weeks. In April 2013, the spaceships are finally in their final stage of testing for commercial use!

Here is a video of one of the test flights:

As crazy as it might seem to some of us, flying to space, it might become the cultural tourism tours of the future generation. Although for now, it is merely for the wealthier tourists amongst us. Space tourism shows us that tourism is becoming such an important economic factor, that it creates new trends, new jobs and new businesses. It is a chance for entrepreneurs to develop something new and to create something successful!

References:

Berk, B. (2012) ‘Space Tourism’, Bloomberg Businessweek, 4268, 88-89.

Elliot, H. (2012) ‘Space-Traveling Cirque Du Soleil Founder On elon Musk: He did the first step for Galactic Tourism’, Forbes, 30.

Spennemann, D.H.R. (2007) ‘Extreme Cultural Tourism: From Antarctica to the Moon’, Annals of Tourism Research, 34, (4), 898-918.

Virgin Galactic (2013) History [www document] http://www.virgingalactic.com/overview/ (Accessed 10 December 2013).

Air Passenger Duty

Air Passenger Duty (APD) is an excise duty charged on passengers carried from a UK airport on a chargeable aircraft. The APD has 4 different destination bands, as the duty depends on the distance of the final destination. As of April 2013 there are 12 different rates, as every band has 3 different rates. (figure 1) (WTM, 2013)

The APD has changed a few times over the last few years, the last changes were made in April 2013, however new rates apply as of April 2014. (WTM, 2013)

Figure 1. APD Rates

Source: WTM, 2013

The APD is the highest rate of air taxes in the world, it is even 400% more then other countries. This causes plenty of protest from the aviation and tourist industry, especially because the rates keep on rising every year. The APD is of great concern for the tourist industry in the UK and therefore both the WTTC as the WTM have included the APD in their reports and surveys the last 2 years. (Jacobs, 2013; Parker and Jacobs, 2013; WTTC, 2012; WTM, 2013)

In 2012 the WTTC and Oxford Economics conducted research about the likely impacts of the APD on the UK’s economy. According to their report, when abolishing the APD there would be an increase in passenger numbers, which would lead to an increase in the GDP and creation of more jobs. The only negative impact that they found was that it can lead to a decrease in domestic tourism due to cheaper flight tickets. (WTTC, 2012)

During the WTM 2013 in London the key exhibitors were surveyed in order to produce the Industry Report 2013. This report showed that the exhibitors believe that less then 3 out of 10 holidaymakers will consider long haul flights due to the increase in APD taxes. Furthermore, they also fear for the UK’s inbound industry, with almost 2/3th of the senior executives of the industry fear that less tourists will visit the UK. (WTM, 2013)

Another report conducted by the ‘A Fair Tax on Flying’ campaign group concluded that the government is losing out on £190 million because travellers fly to mainland Europe first, before flying to mid- or long-haul destinations, in order to avoid the APD taxes. (ABTA, 2013; WTM, 2013)

Even though, the airlines agree that they should pay taxes towards environmental issues, they believe the current APD is excessive, it is the highest in the world. (Jacobs, 2013)
The most problems are, as always, for the passengers. How many of the travellers cannot afford to fly and take the train or ferry instead? Although, this might be acceptable when going on holiday, some travellers take extra hours on a weekly basis commuting from home to work.
Measurements should be taken to decrease these taxes, if it works for other countries, surely it must work for the UK?

References:

ABTA (2013) Air Passenger Duty [www document] http://abta.com/news-and-views/policy-zone/more/air-passenger-duty (Accessed 28 november 2013)

Jacobs, R. (2013) ‘Airlines step up fight over passenger Duty’. The Financial Times, 4 February.

Parker, A. and Jacobs, R. (2013) ‘Budget 2013: Airlines attack air passenger duty rise’. The Financial Times, 20 March.

WTM (2013) Industry Report [pdf file] http://www.wtmlondon.com/page.cfm?requestTimeout=1000 (Accessed 28 November 2013).

WTTC (2012) The Economic Case for Abolishing APD in the UK Oxford: Oxford Economics.

CO2 emissions and the aviation industry.

Climate change has been a hot topic for the past decade and it still is. The whole world is concerned about the change our planet is going through and a lot of measurements are being taken to prevent further negative change. Everyone can contribute to make our planet a greener planet and everyone can try and put a stop to this climate change by little things such as recycling, walking to the shop instead of driving etc. However, some precautions have to be made by the government, both on a national as an international level. The Kyoto protocol is one of the best-known international agreements to try and reduce the carbon emission by setting internationally binding emission reduction targets.

The aviation industry causes 13% of the CO2 emission of the transportation sector, which leads to 2.5% of global CO2 emission. Its impact can therefore not be neglected.
Airlines are trying to market a green image by, for example, offering green seats. In the mean time, the new airplanes being made are build in a way so they produce less CO2, which will certainly help decreasing the overall CO2%. Passengers can also help by taking the train instead of the plane on short duration, for example instead of flying from Brussels to Heathrow, a customer can easily take the Eurostar. Even though, all these little things can help, the EU commission is actively trying to seek regulations to reduce the CO2 within the aviation industry.

After freezing their proposal last year, due to protest from airlines, emerging countries and aircraft builders, the EU has created a new proposal in October 2013. This new proposal would apply from the beginning of 2014 until the ICAO (International Civil Aviation Organisation) regulations will be applied. The ICAO has agreed to design a global mechanism to reduce the CO2 in the aviation industry after 2020. However the assembly will not vote before 2016, which means the EU proposal will be affective for a good 2 years.
http://cfapp.icao.int/Environmental-Report-2013/#22/
The new EU proposal simply states that ‘airlines using EU airspace could be subjected to a tax for air-polluting carbon emissions on the portion of a flight that crosses the European Economic Area (EEA).’
If the EU parliament and its members do not accept this new proposal, the frozen EU proposal from last year will be effective.
Unfortunately, this proposal already raised a lot of concerns and protests from the aviation industry about trade wars, mainly from IATA, which represents around 240 airlines.

There seems to be a problem between the aviation industry and the European Commission about the methods of reducing the CO2 %. Due to the two groups not agreeing with each other, it seems that the solution or at least an attempt to reduce CO2 is further away then ever. Both groups need to realise that CO2 needs to be reduced; there is no way around that. The aviation industry cannot just sit back and wait until 2020 when all the other industries are making an effort in reducing CO2 emissions. Good communication and being open minded could lead to a compromise which will suit both the EU and the aviation industry. The compromise is only for a few years, until the ICAO regulations will apply. The airlines need to show their willingness to accept the EU regulations and need to show they are making enough real attempts to reduce the CO2 emissions and not just market their airline as a ‘green airline’.
In the meantime, it is up to all of us to try and help out where we can, to make our planet a better and greener place.

Bibliography:

IATA. (2013) Factsheet: Climate change [www document]. http://www.iata.org/pressroom/facts_figures/fact_sheets/pages/environment.aspx (Accessed 11 November 2013).

ICAO. (2013) Environmental report [www document]. http://cfapp.icao.int/Environmental-Report-2013/#22/ (Accessed 11 November 2013).

Lewis, B. (2013) Carbon pricing needed to control airline CO2 emissions. http://uk.reuters.com/article/2013/03/04/us-airlines-emissions-study-idUSBRE92306I20130304 (Accessed 11 November 2013).

Heathrow versus Boris Island

With only 2 more months to go before the end of 2013, the battle for UK’s new airport hub is still going strong. The main battle seems to be between Heathrow and the Thames Estuary Island. With mayor Boris Johnson as the leading support of the now so-called Boris Island (Thames Estuary Island), British Airlines decided to back up the extra runway at Heathrow, BA is currently the most important airline at Heathrow, therefore its support will not go unnoticed.
Willie Walsh, who is the chief executive of IAG (partner of BA), claims that BA would never leave Heathrow for an island in the Thames Estuary, as the costs of moving would simply make the move impossible.

IAG has also expressed its worry about the Airports Commission being unable to make the right decision due to the upcoming elections. As with any important political decision, politicians are often questioned if the decisions they make are based on boosting their image for the elections or based on what they believe is in the country’s best interest.

It cannot go unnoticed, however, that both IAG and BA were already on bad terms with the government due to the current proposal by the aviation regulator for landing charges paid by the airlines. This might influence their opinions about the Airports Commission.

http://www.ft.com/cms/s/0/fdae6f6e-3b2d-11e3-87fa-00144feab7de.html#axzz2jrXSyE52
In the meantime Boris Johnson is on its way of becoming TEI’s most important marketing executive. Several articles are being written about Boris’ support for the TEI and how conservative and narrow-minded it would be to simply expand Heathrow, Gatwick or Stansted as they do not provide appropriate long-term options.

A mayor not only supporting what he believes in but also trying to do what he believes is right, should be admired. But as always, it is criticized that politicians always seem to find a cause to fight for when they have the elections in mind.

As an international student, I notice that Boris Johnson is taken up a roll of promoter for the TEI and stops being a mayor. This battle between the hubs is important, as it is a difficult but vital decision for the country’s tourism and aviation industry. However, taken a step back from media and press coverage can sometimes have a better result. Less is more, no?

http://www.ft.com/cms/s/0/c1245faa-3703-11e3-b42e-00144feab7de.html#axzz2jrXSyE52

The UK and its aviation hub problems.

According to research conducted by IATA (2013), traffic grew with 5,3% in 2012. Airlines responded to this growth by buying newer and more aircrafts, however it is important to realise that capacity on the ground must match capacity in the air. The Airports Council International reports that 70% of the airports do not make money, so where is the money for an expansion of the infrastructure going to come from? And how does a country or council solve this issue? (IATA, 2013)

The UK wants to increase its aviation capacity, not only because it needs to, due to the increase in passengers, the airport is also losing from its European competition (figure 1).

Figure 1: Hub airports in Europe.

Source: Heathrow (2013)

In 2012, several options have been submitted to increase this capacity. The Airport Commission, led by Howard Davies, must make a decision by the end of 2013 and submit their proposal to the government. Several issues and complaints have been formed about the different options, often stated by London major Boris Johnson and the airport watch, who both are trying to influence the commission. (Airports Commission, not dated)

The different options have their advantages and disadvantages, however, it is up to the commission to decide which option is the most efficient for Britain. Lets take a closer look at some of the different options and their (dis)advantages.

1. Expanding Heathrow

Heathrow is not only one of the most important hubs in the UK, with nearly 70 million passengers in 2012, it is also seen as the EU’s most important aviation hub. Unfortunately Heathrow is currently running close to its maximum capacity, with 98% of the capacity currently being used, leaving no space to increase the amount of passengers and flights. (BBC, 2013; Heathrow, 2013)

Heathrow proposed to increase the capacity by building a third runway. Three options are proposed, a North runway, North-West runway or South-West runway (Figure 2).

Figure 2: Heathrow’s third runway.

Source: BBC (2013)

The north option would be the quickest (2025) and the cheapest (£14bn), but it has the highest noise pollution and property impact. (BBC, 2013; Heathrow, 2013)

The North-West option has lower noise pollution and residential property impact but it will have a greater impact on important heritage buildings. This option is also considered to be cheap (£17bn) and fast (2026). (BBC, 2013; Heathrow, 2013)

The third and final option has the lowest residential property impact but it has a great impact on natural habitats and flood zone storage. It is also the most expensive (£18bn) and it will take the longest to complete (2029). (BBC, 2013; Heathrow, 2013)

In general Heathrow is considered to be the best short-term option, as a third runway can be completed relatively quickly and cheap. Another advantage is that it cited to have knock-on effect to businesses in the area. (BBC, 2013; Heathrow, 2013)

However there are several disadvantages to this option that worry a lot of locals. The environmental impacts will be severe as Heathrow will become the biggest emitter of carbon dioxide in the country. Besides environmental impacts a lot of concerns come from local residence about the noise pollution and the loss of homes. (BBC, 2013; Heathrow, 2013)

A summary of Heathrow’s submission report can be found at http://www.heathrowairport.com/about-us/company-news-and-information/airports-commission?cmp=LHRDCHERO.

2. The Thames Estatuary Airport

A second option is the Thames Estatuary Airport (TEA), which is supported by major Boris Johnsen (Figure 3). A new four-runway airport would be build in the East of England and is considered by the major of London to be the best solution as it would decrease the noise pollution, create job opportunities for East England and would provide a hub that is big enough to compete with other European airports.  (BBC, 2013; Burns, 2013)

If this new hub would be build, it means that Heathrow will be closed. This could lead to major impacts on the economy and businesses surrounding Heathrow. (BBC, 2013; Burns, 2013)

The new hub would also be a threat to rare wildlife and therefore presents a risk for bird strike to planes. Bird strikes can cause a lot of damage to planes and consequently can cost airlines a lot of money. Air traffic controllers say that this airport would be located on the worst spot for traffic.

The cost and time of this project is considered to be another negative, as it would cost around £50bn, the airport and the infrastructure itself would be nearly £24bn. Pessimists even claim the cost could easily go up to £100bn. (BBC, 2013; Burns, 2013)

More information can be found on the website http://thamesestuaryairport.com.

Figure 3: The Thames Estatuary Airport

Source: Burns, J (2013)

3. Gatwick Expansion

A third option would be a second runway at Gatwick airport. Gatwick is currently a busy single-runway airport but has the option to increase its capacity by building a second runway, which could be opened in 2025 and would only cost between £5bn and £9bn. The extra runway could increase passenger numbers from about 34.2 million to between 67 and 87 million a year. (BBC, 2013)

The benefits of this option is that Gatwick already has good transport links to London and less people would be affected by noise pollution then the third runway at Heathrow. (BBC, 2013)

The downsides would be that the new runway will not be built until 2019 and that there has been a North terminal built on the exact spot where the second runway would have been. Although good transport links already exist, a high-speed link will still need to be built. This link will be a long-term and expensive project. The biggest downside of this option is that the UK hub will be split between two airports, which is something the market is not eager about. (BBC, 2013)

4. Stansted Expansion.

A fourth option would be to build an extra runway at Stansted. Although this option has several advantages, the main concern is that the market demand for extra capacity is situated North and West London, whereas Stansted is located North and East London. If there is no market, what is the point in investing in a new hub on the wrong side of town? (BBC, 2013)

References:

Airports Commission (not dated) About us. [www document]. https://www.gov.uk/government/organisations/airports-commission/about (Accessed 29 November 2013).

BBC (2013) Airport expansion: Which options will be cleared for take-off? [www document]. http://www.bbc.co.uk/news/uk-19570653 (Accessed 27 November 2013).

Burns, J. (2013) Thames Estuary Airport could be built for £24 billion and open in 2027. [www document]. http://www.airport-world.com/home/general-news/item/3158-thames-estuary-could-be-built-by-2027-smart-airports-conference-hears (Accessed 27 November 2013)

Heathrow (2013) A New Approach: Heathrow’s options for connecting the UK to growth [pdf file]. http://www.heathrowairport.com/static/Heathrow/Downloads/PDF/a-new-approach_LHR.pdf (Accessed 29 November 2013).

IATA (2013) Infrastructure – Due care and attention. [www document]. http://www.iata.org/publications/airlines-international/june-2013/Pages/infrastructure-growth.aspx (Accessed 29 November 2013).

New Tourism Blog

As a first time blogger, I am excited to enter the blogger-world and to see where this will lead me.
Ever since I was little I have had a fascination with airplanes and airports which slowly developed into an interest in the tourism industry. Therefore I decided to start a MA in International Tourism Management at the University of Greenwich.

As the tourism industry covers a lot of different aspects and sub industries, this blog will mainly focus on airports and airlines in the UK. This part of the industry cannot be forgotten, as without airlines and planes, the tourism industry of today would look completely different.