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caliboy93
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Size of London aviation market

Sun Jan 27, 2019 5:47 am

How big is the London aviation market? I'm asking because are there actual figures that determine this?
 
aviationaware
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Re: Size of London aviation market

Sun Jan 27, 2019 7:06 am

You have to be a bit more specific. How big in what sense? Number of passengers? Very easy to answer. Revenue? Difficult to answer. Induced GDP contribution? Even tougher.
 
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PatrickZ80
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Re: Size of London aviation market

Sun Jan 27, 2019 9:03 am

The easiest way to measure this is by passenger numbers. They are:

Heathrow: 80,102,017
Gatwick: 46,075,400
Stansted: 25,902,618
Luton: 16,581,850
City: 4,820,292
Southend: 1,480,139

Total: 174,962,316 passengers per year. That's more than any other city in the world.

For comparison, Atlanta, the busiest airport in the world, handles 103,902,992 passengers per year. That's not even two third of the total London passenger numbers. Beijing, the number two in the world, handles just over half as many passengers as London.

However what you should also take into consideration is that it's a very tough market with some of the heaviest competition in the world. It may be a big market, but even big markets can be overserved. I'm not saying London is overserved, but it's definitely not underserved.
 
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Re: Size of London aviation market

Sun Jan 27, 2019 9:47 am

JFK, EWR, LGA: 127.5m. With HPN, ISP, and SWF: around 130m.
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Kilopond
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Re: Size of London aviation market

Sun Jan 27, 2019 11:37 am

For may years, the top three have been London, New York and Tokyo. in this particular order.

https://en.wikipedia.org/wiki/List_of_b ... er_traffic
 
uta999
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Re: Size of London aviation market

Sun Jan 27, 2019 1:53 pm

LGW can handle 46m passengers using a single runway. Does this mean LHR in theory will soon reach 90m with two? The airport layout at Heathrow is slightly better and the average a/c much bigger. I am surprised LHR doesn't cram in more people. Perhaps T4 has a negative impact on field operations.
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EvanWSFO
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Re: Size of London aviation market

Sun Jan 27, 2019 2:00 pm

uta999 wrote:
LGW can handle 46m passengers using a single runway. Does this mean LHR in theory will soon reach 90m with two? The airport layout at Heathrow is slightly better and the average a/c much bigger. I am surprised LHR doesn't cram in more people. Perhaps T4 has a negative impact on field operations.


It's slot restricted. I believe it's at 99% capacity. I can only grow by larger a/c or the third runway that may be built.
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jagraham
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Re: Size of London aviation market

Sun Jan 27, 2019 2:59 pm

Revenue is harder, but there is a thread discussing the world's most profitable routes. London is highly represented

viewtopic.php?f=3&t=1398375&p=20537789&hilit=london+to+new+york+revenue#p20537789
viewtopic.php?f=4&t=1398091

Here is the full list of the top 10 revenue-earning flights around the globe and how many dollars (rounded) each brought in over the course of a year.

British Airways NewYork JFK toLondon Heathrow: $1.04 billion
Qantas Airways Melbourne to Sydney, $855 million
Emirates London Heathrow to Dubai, $819 million
Singapore Airlines London Heathrow to Singapore, $710 million
American Airlines Los Angeles LAX toNewYork JFK, $698 million
United Airlines San Francisco to Newark, $688 million
Cathay Pacific Airways Hong Kong toLondon Heathrow, $632 million
Qatar Airways London Heathrow to Doha, $553 million
Air Canada Vancouver to Toronto Pearson, $552 million
Singapore Airlines Sydney to Singapore, $544 million

Of the top ten routes, six have London on one end.
 
MIflyer12
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Re: Size of London aviation market

Sun Jan 27, 2019 4:55 pm

jagraham wrote:
Revenue is harder, but there is a thread discussing the world's most profitable routes. London is highly represented

viewtopic.php?f=3&t=1398375&p=20537789&hilit=london+to+new+york+revenue#p20537789
viewtopic.php?f=4&t=1398091

Here is the full list of the top 10 revenue-earning flights around the globe and how many dollars (rounded) each brought in over the course of a year.



You're conflating profit and revenue. They really aren't the same...
 
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SheikhDjibouti
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Re: Size of London aviation market

Sun Jan 27, 2019 6:18 pm

jagraham wrote:
Here is the full list of the top 10 revenue-earning flights around the globe and how many dollars (rounded) each brought in over the course of a year.

British Airways NewYork JFK toLondon Heathrow: $1.04 billion
Qantas Airways Melbourne to Sydney, $855 million
Emirates London Heathrow to Dubai, $819 million
Singapore Airlines London Heathrow to Singapore, $710 million
etc
etc

Of the top ten routes, six have London on one end.

Do we believe that each of these airlines has opened it's books for OAG to compile this list? :shakehead:

OAG wrote:
Combining our flights schedules and traffic data we’ve created a list of the Top 10...

I can only guess that they have multiplied the number of flights x number of seats x published ticket price x load factor.

As a metric for comparing city pairs it has some value, but in many respects it leaves more questions than answers.
For instance; why do most of the market pair codes commence from the "wrong" end? BA shows up with JFK-LHR, and Emirates with LHR-DXB.
(I am taking them at face value, and assuming they do not represent return flights)

The only link I can see, is that they are all west to east (correct me if I am wrong), and presumably have the benefit of tailwinds making flight times shorter.
This particularly comes into play in the final two columns of the original table, where scheduled hours are brought into the equation.
In simple terms, BA theoretically makes more money per flying hour on the return leg of LHR-JFK / JFK-LHR.
I'm clutching at straws here - anybody got a definitive answer?

https://www.oag.com/blog/billion-dollar ... i=64201665
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Geoff1947
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Re: Size of London aviation market

Sun Jan 27, 2019 8:36 pm

caliboy93 wrote:
How big is the London aviation market? I'm asking because are there actual figures that determine this?


Aviation markets are highly elastic, almost all flying is at personal discretion. Give the tickets away and everybody wants to fly. Have a bomb attack and nobody wants to fly.

Best to look at actual numbers rather than markets.

Geoff
 
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readytotaxi
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Re: Size of London aviation market

Sun Jan 27, 2019 8:49 pm

Do you want to included private traffic in the total? Biggin Hill, Farnborough.
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Kilopond
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Re: Size of London aviation market

Sun Jan 27, 2019 10:32 pm

readytotaxi wrote:
Do you want to included private traffic in the total? Biggin Hill, Farnborough.


Then you can also include Teterboro TEB and the likes. But whatever statistical methodology you use, for now LON, NYC and TYO are winning gold. silver and bronze, respectively.
 
jagraham
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Re: Size of London aviation market

Mon Jan 28, 2019 12:02 am

The article goes into profits (somewhat) and there is another thread that discusses profitability.
But the net analysis is that airlines are in a low profit business. Which is harder to discuss per route or per market.
What can be easily said is gross and net profit; AAR 3Q18 revenue $11.6 B, GAAP operating expense $10.9 B GAAP pretax income $456 M (3.9%)
UAL 3Q18 revenue $11B (pax revenue $10.2 B), pretax income $1B (9%) PRASM 13.73 TRASM 14.93 CASM 13.30
DAL 3Q18 revenue $11.9B (pax revenue $10.8B) pretax income $1.6B (13.4%), PRASM 14.81 TRASM 16.4 CASM 14.15

The difference between PRASM and CASM is quite small; the major airlines are making most of their profits somewhere else other than ticket sales.

Airlines make it hard to see where they are making profit. But I think OAG had something along those lines in conjunction with the top ten revenue city pairs. I will try to dig it up later.
 
AirbusA6
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Re: Size of London aviation market

Mon Jan 28, 2019 12:58 am

PatrickZ80 wrote:
The easiest way to measure this is by passenger numbers. They are:

Heathrow: 80,102,017
Gatwick: 46,075,400
Stansted: 25,902,618
Luton: 16,581,850
City: 4,820,292
Southend: 1,480,139

Total: 174,962,316 passengers per year. That's more than any other city in the world.

For comparison, Atlanta, the busiest airport in the world, handles 103,902,992 passengers per year. That's not even two third of the total London passenger numbers. Beijing, the number two in the world, handles just over half as many passengers as London.

However what you should also take into consideration is that it's a very tough market with some of the heaviest competition in the world. It may be a big market, but even big markets can be overserved. I'm not saying London is overserved, but it's definitely not underserved.


I assume a proportion of the LHR flights will be transit passengers, with a small number at LGW and hardly any at the other London airports?
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Zoedyn
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Re: Size of London aviation market

Mon Jan 28, 2019 1:02 am

Given the outsize effect of first-class and business-class pax on airlines' revenues and profits, I think the following map by Knight Frank (first appeared in 2017) surely gives a very useful clue to the question OP raised

Image
https://www.knightfrank.com/blog/2017/0 ... bal-cities

Knight Frank's map shows the number of first-class and business-class pax travelling by air between each city. The closer the name of the city to another and the thicker the connecting line, the greater pax flow between them. The larger the size of the city name, the more first- and business-class pax it handles

So, in this metric, it's easy to note London is obviously the most dominant city hub, followed by New York, Shanghai, Beijing, Hong Kong, Singapore, Washington DC, Tokyo, et al (the location of Seoul and Washington DC in the map does raise suspicions though)
 
aviationaware
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Re: Size of London aviation market

Mon Jan 28, 2019 1:09 am

SheikhDjibouti wrote:
Do we believe that each of these airlines has opened it's books for OAG to compile this list? :shakehead:

I can only guess that they have multiplied the number of flights x number of seats x published ticket price x load factor.


I have insight into the source numbers for some items on that list and I can tell you their estimates are not far off.

Zoedyn wrote:
(the location of Seoul and Washington DC in the map does raise suspicions though)


They were clearly mixed up. Their respective connectivity graphs are exactly where you'd expect the other to be, particularly Seoul which is a prime connector to Japan (especially secondaries).

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