Big Interview: Manchester airport sets out credentials as aviation’s northern powerhouse

Big Interview: Manchester airport sets out credentials as aviation’s northern powerhouse

The chief executive of a growing northern long-haul powerhouse talks to Lee Hayhurst as Manchester airport takes off with the Best UK Airport accolade at last week’s Globe Travel Awards

It can feel like the UK aviation sector is in a state of perpetual stasis as the process of building new runway capacity in the southeast looks like rumbling on for many more years to come.

But outside of London an airport with no such constraints is busily consolidating its position as a genuine alternative to the UK’s dominant hub Heathrow and its nearest rival Gatwick.

Manchester airport is now run by chief executive Ken O’Toole, a former airlines man who worked for budget carrier Ryanair as route development director.

He joined Manchester Airports Group five years ago as commercial officer, responsible for all group revenue streams, as the firm sold a 35% stake to Australian investor IFM and bought Stansted.

Over that time Manchester’s passenger numbers have swelled to 25.5 million from 17 million. It is on track to top 26 million for the financial year to March.

“We now have flights to places like Singapore, San Francisco, Jeddah, Hong Kong and Beijing – true international cities and hubs. We are the northern option.

But as one of only two UK airports with two full-length runways – you may remember eco-warrior Swampy’s efforts to thwart its construction in the late 1990s – there’s plenty of scope to grow.

O’Toole says Manchester’s growing hub status is reflected in long-haul growth.

“If you look at long-haul networks in the UK as a whole you either look at Heathrow or Manchester,” he says.

O’Toole says modern aircraft such as the Boeing 787 Dreamliner and Airbus A350 enable more point-to-point long-haul flying but growth has come from promoting its network to customers and through the trade.

“We now have flights to places like Singapore, San Francisco, Jeddah, Hong Kong and Beijing – true international cities and hubs. We are the northern option.

“We very much see our network as an alternative to Heathrow’s. We don’t have as deep connections as Heathrow but they are growing.”

On track for HS2

 

Manchester is poised to enhance its appeal further with a £1 billion redevelopment of Terminal 2, which will eventually see the ageing 1960s Terminal 1 retired.

The airport has planning permission and is working with preferred developer Laing O’Rourke on costs, with the facility due to open in summer 2020.

Manchester’s potential hinterland is set to expand with the planned HS2 rail route linking the West Midlands to Manchester.Plans for a station at the airport were unveiled last week. In time, the proposed HS3 east-west rail route across northern England could further improve access to Manchester airport.

O’Toole says the aviation industry already appreciates that 22 million people live within two hours’ drive of the airport – a catchment area that does not overlap with Heathrow’s.

“Manchester is serving a wider catchment,” he says. “We see that in terms of people coming from Wales and southern Scotland and even towns in the Midlands. We are extremely well-connected.

“We have an HS2 station as part of the scheme located on site and we are very much aligned with the vision for transport for the north and HS3. The potential of that for us is interesting. Instead of taking one hour to get from Leeds to Manchester you will be able to do it in 30 minutes.

“Look at Heathrow and Gatwick for train access. They each have 10 million people within two hours; our equivalent at present is three million. But HS2 and HS3 combined would put us on a par.

“Big infrastructure, like a new runway in the southeast, is not going to come along quickly.

The new Terminal 2 will be transformative. Eventually, up to 80% of the airport’s traffic will go through it.

“We are enthusiastic about the potential that gives our region to exploit Manchester airport.”

Theoretically, Manchester could handle 55 million passengers a year in terms of existing runway capacity. However, its ability to cater for such numbers is constrained by its ageing infrastructure. Currently, at peak times, it can struggle to cope with less than half that figure.

O’Toole concedes that Terminal 1 is “difficult to manage and operate” as it approaches the end of its life, and says the passenger and customer experience is “not ideal”.

So the new Terminal 2 will be transformative. Eventually, up to 80% of the airport’s traffic will go through it.

“You are going to have brand‑new facilities – that’s going to make a huge difference to the passenger experience,” says O’Toole.

“We will have terminal capacity to match our runway capacity.”

The new terminal will give a 20% boost to the number of passengers the airport can handle per hour – to 8,400 – by providing new self-service check‑in facilities and more-efficient security lines.

US pre-clearance

 

Manchester has also been working with the US authorities for the past 18 months on plans to make the new terminal compatible for pre‑clearance.

This means arrivals from the UK will be treated like domestic customers – like those flying from Shannon, Ireland, and Abu Dhabi today – and Manchester expects this to boost transfer traffic.

“We have the scale in terms of US destinations that only Heathrow can match,” says O’Toole.

“We will deliver a product much better than anything in Europe that will be unique in the UK.

“More importantly, it will provide convenience which we think passengers will want to use.”

Airline empathy

 

O’Toole is proud of the growth that Manchester, and Stansted, has achieved during his time with MAG, and believes his background in airlines has helped foster a more mutual understanding.

“I have come from airlines and most of the aviation development team come from airline backgrounds. I do not think that’s unrelated to the success in growing passenger volumes,” he says.

“We need to be competitive on costs, offer great service to airlines and customers, and provide a great customer experience.

“We understand the needs of airlines. Yes, low-cost and full‑service carriers are different, but all want bums on seats paying as high a fare as possible.

“We run a commercial business, like airlines, and need to make money to invest in our facilities in the same way that airlines have to maintain their flights.

“The great thing about the market is it’s always changing.

“We need to be competitive on costs, offer great service to airlines and customers, and provide a great customer experience.

“We are clear on what we need to do and the different expectations of our customer bases, but we also realise things change. Being flexible and able to respond to change is important.

“That’s difficult in an airport where the infrastructure is quite fixed. The relative allocation of space between airside, landside retail and security at the moment won’t be relevant in five to 10 years. We have to make sure we have that flexibility to respond.”

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