Business Weekly - Cambridge, UK

A BAA Stansted director said: "American's relaunch here takes things to a new level for Stansted.

For the world's largest airline to give this vote of confidence to Stansted is great news but it is also fantastic for the region in terms of what it can do for economic growth."

The decision by Luton's Spanish owner, Abertis, to scrap plans for a new runway was made because it would take too long to secure a return on the investment.

The UK government now desperately needs Stansted's second runway to go ahead as a matter of urgency to underpin regional airport growth as passenger demand continues to soar and the London Olympics looms.

Ferrovial, Stansted's owner, says it is committed to the project having conducted a review of the airport from top to bottom.

Business Weekly understands it is making a strong case to the Competition Commission to leave BAA's London airports portfolio intact.

We believe the Commission has held preliminary meetings with Ferrovial having been asked to consider dismantling the Heathrow-Gatwick-Stansted 'monopoly.' Ferrovial has put a strong argument in favour of keeping the airports together because it can use the financial strength of that proposition to underpin its multibillion pound investment plans across the three.

Breaking up the London portfolio would dilute its spending power and put the Government's growth strategy for South East airports at additional risk.

The decision by American Airlines, the world's largest carrier, to return to Stansted with both economy and business seats will trigger an expansion boom at the Essex hub for low cost business airlines Eos and MAXjet. BAA Stansted executives say American's higher profile and marketing reach in the US will drive extra traffic for the young guns. With neighbouring London Luton scrapping its plan for a new runway, American's arrival from October to launch a link to New York's JFK couldn't be better timed for Stansted.

American is already talking about doubling up its service from the spring of 2008 and a BAA spokesman said: "We firmly believe AA's arrival will also spell a boom for Eos and MAXjet. All the indications are that the three airlines serving America from Stansted will feed off one another." Why should American succeed this time when it failed after just 11 months when it launched from the Essex hub in the early 90s? A spokesman for American said: "At the time we briefly operated the Chicago-London Stansted service the route was not economically viable. Since that time Stansted has grown in importance and popularity as one of London's international airports.

"There has also been a shift of many London-based business- es to the old London Docklands, east of the capital and for which Stansted is conveniently located with rapid rail links to Liverpool Street station. "We believe these factors make it an excellent time to once again offer services from Stansted." Stansted passenger numbers were running at 2.1 million a year in 1993 and have grown 12-fold to 24m. A BAA Stansted director said: "American's relaunch here takes things to a new level for Stansted. For the world's largest airline to give this vote of confidence to Stansted is great news but it is also fantastic for the region in terms of what it can do for economic growth."

The decision by Luton's Spanish owner, Abertis, to scrap plans for a new runway was made because it would take too long to secure a return on the investment. The UK government now desperately needs Stansted's second runway to go ahead as a matter of urgency to underpin regional airport growth as passenger demand continues to soar and the London Olympics looms.

Ferrovial, Stansted's owner, says it is committed to the project having conducted a review of the airport from top to bottom. Business Weekly understands it is making a strong case to the Competition Commission to leave BAA's London airports portfolio intact. We believe the Commission has held preliminary meetings with Ferrovial having been asked to consider dismantling the Heathrow-Gatwick-Stansted ‘monopoly.' Ferrovial has put a strong argument in favour of keeping the airports together because it can use the financial strength of that proposition to underpin its multi- billion pound investment plans across the three.

Breaking up the London portfolio would dilute its spending power and put the Government's growth strategy for South East airports at additional risk.