Start defining markets by reference to real markets and not by an outdated national context of markets

In conversation with…Robert Webb QC, General Counsel, Rolls Royce*

EP Hospitality Business Insight: exploring key questions from the BHA Hospitality and Tourism Summit

EP working with the British Hospitality Association to promote thought leadership

logo_bha

Robert was part of the “Breaking Records” section of the Summit which sought to discuss how the hospitality and tourism industry was evolving in relation to new technologies, and how leaders were weaving values, environmental sustainability, purpose and responsibility into business.

In a one-on-one discussion with Jonathan Counsell, head of environment, British Airways, Robert referred to a number of key aviation policy issues which were impacting on the capacity management at Heathrow airport. Both Jonathan and Robert spoke of the goal to preserve the hub concept at Heathrow and the challenges this bought with it, due to limited capacity.

Aviation policy and infrastructure emerged as a key theme of the conference, so EP wanted to debate the issues with Robert in more detail.

“The intellectual point is that a hub airport is more than just a busy place. It’s a place where you bring people and interline them to other flights, meaning that you can make greater economic success from serving more destinations.

“In England, there is only one hub and that’s Heathrow. But Heathrow is small – it’s half the size of Frankfurt and less than half the size of Amsterdam or Paris – so it is difficult to develop the hub, because you have to continue to spend so much of your time in point to point transit. Therefore, what we need is to increase the capacity of the hub carrier at Heathrow and one way to do this is build a third runway.

“An alternative is to build a airport somewhere else but that decision is far too late in airline planning terms. At my age, I can remember debates about Maplin and second runways at Stansted – a new hub airport makes no real sense to anybody over 60!”

So with competition increasing what are the issues?

“New, large conference centres are being built outside of the UK and you can see the UK becoming more difficult to get in and out of; the fact is that ‘Easyjetting’ in and out of places is quite affordable.

“We need to increase the infrastructure in whatever way. This could be to build a third runway, experiment more with mixed mode, introduce a single sky over Europe for air traffic control centres and introduce some codes on environmental good behaviour. I would also advocate introducing duty free at point of arrival, rather than at the point of departure.

“We need to start defining markets by reference to real markets and not by an outdated national context of markets. Tourists don’t define their behaviour by reference to a national market in terms of where to go on holiday. When you see how John Smith at BBC Worldwide (in an earlier presentation) demonstrated how they had capitalised on their digital evolution on a global scale, it shows you what can happen. There is no reason why UK tourism should not be out there in the same way.

“With regards to aviation policy it’s a case of how you do it best.”

* Rolls-Royce, a world-leading provider of power systems and services for use on land, at sea and in the air, has established a strong position in global markets – civil aerospace, defence aerospace, marine and energy and nuclear. Rolls Royce spend £1 billion on research and development annually.

Related Posts