Today's announcement by UK competition regulators that it will force airports operator BAA to sell London Gatwick, London Stansted and either Edinburgh or Glasgow within two years has met with varied reactions from inside and outside the aviation industry.
The decision was broadly expected after the Competition Commission last summer outlined its proposals in a consultation document. Under the CC's final decision, BAA will be forced to sell first Gatwick, then Stansted and finally either Edinburgh or Glasgow within two years. BAA had already put Gatwick on the market ahead of the final decision.
BAA's response to the decision has been brief; the airports operator says it believes the CC's analysis to be "flawed" and that its "remedies may be impractical in current economic conditions". It adds that it is "considering" the CC's report.
The Unite union, however, has been more vocal in its outright rejection of the decision. The union's national secretary for aviation, Steve Turner, says: "The report creates further and unnecessary instability in a sector already in turmoil given the impact of the global economic downturn on aviation."
EasyJet and Ryanair - both of which have long called for the break-up of BAA - have welcomed the CC's decision. "The BAA monopoly has done enormous damage to competition and the travelling public and Ryanair welcomes the CC's recommendation to break up the BAA airport monopoly," says Ryanair director of legal and regulatory affairs Jim Callaghan, who is also calling on UK civil aviation authority group director of economic regulation, Harry Bush, to resign.
Adds easyJet: "The Competition Commission has completed an excellent body of work of the sort that has been sorely lacking over the years in the industry. It has demonstrated regulatory gaming by BAA allied with profound weaknesses in how our airports are regulated.
"The break-up of BAA has been the inevitable outcome of these failures, but break-up alone will not resolve the problems of individual monopoly airports. The responsibility now rests with Government, in its current review, to ensure that airports and regulation are not allowed to fail airlines and their passengers again"
Bob Atkinson from Travelsupermarket.com says the decision to break up BAA is good news for the consumer, adding that he expects BAA to sell Glasgow and hold on to Edinburgh because of the latter's "growth potential and less reliance on holiday traffic".
Already reports are circulating as to who could potentially bid for the three airports as they are eventually sold off. A report referencing unnamed sources in the Manchester Evening News, for instance, claims that Manchester Airport Group is planning to bid for one of the two Scottish airports. MAG is said to have been one of six parties that submitted a formal interest in bidding for London Gatwick earlier this year.
Source: Airline Business
