n° 9
Thematic Report
of the French Air Transport Directorate
december 2008
Air traffic between France and the United Kingdom: air
transport between the Regions, train between capitals
Preamble
"Paris-London" was the most important international air connection for a long time.
Since 8 February 1919, when the first passenger air service in the world was launched by the
Farman Company (Paris-London in 2:37), the traffic on this line has kept growing, reaching
over four million passengers. With the construction of the Channel Tunnel and the TGV Nord
in 1994 and the high-speed lines in England, rail traffic increased between Paris and London.
From 2007, it was no longer the first airline departing from France. However, the dynamic
offers from low cost companies led to strong growth in traffic between France and England,
no longer driven by connections between capital cities.
This review provides an original analysis of the impact that a new (low-cost) airline offer
has on demand.
1. Cross -Channel traffic:
a stagnating market since 2000…
After steady growth (9.3 % on average per year) during
the four years following the launch of the Eurostar
(November 1994), cross channel traffic languished
at 45 million passengers per year (figure 1). The
ferry remains the preferred cross channel mode of
transport (17.6 million passengers in 2006 i.e. 39 %
of the total). This is followed by train travel with 15.5
million passengers (34 %) and air travel with 12.1
million passengers (27 %).
55
Eurotunnel shuttles*
50
Eurostar
45
Air (France - UK excl. Paris-London)
40
Air (Paris-London)
35
Ferries (9 French ports)
30
25
20
15
10
5
0
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
* Passengers of vehicules on "tourism" shuttles
Source : SNCF, DGAC, DTMPL, Eurotunnel
12
Figure
1. Overall cross channel traffic
Eurostar
(millions ofAirpassengers)
(Paris-London)
10
Air (France - UK excl. Paris-London)
8
6
4
2
…in which air transport
is winning market share
(see figure 2 & 3)…
••
lthough it is still the most popular mode of transA
port, passenger traffic on ferries decreased to 18.2
million in 2007 from 28.8 million passengers in 1994
and its market share was halved (39 % in 2006).
Railway traffic dropped by 13 % between 1998 and
2007, from 18.6 million passengers in 1998 to 16.1
million in 2007. This decline is attributable to the
decreasing number of Eurotunnel shuttle passengers.
On the other hand, Eurostar saw its traffic increase
30
Sea transport
by 3.3 % per year between 1997-2007
and its share
Rail transport
25
in cross-Channel traffic amounts to
17.7 % in 2007
Air transport
compared to 12.4 % in 1997.
20
In 2007, Eurostar passenger numbers rose by 5.1 %, a
15
rate slightly lower than 2006 (5.4 %), but, the traffic
10
has been increasing by 11 % since the middle of
5
November 2007, the date of the opening of high0
speed tracks in the UK. From January to September
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008, Eurostar traffic grew by 13.9 % compared to
the same period of 2007.
As for the airline traffic between France (mainland)
and the UK, despite the launch of the Eurostar it has
regularly and steadily increased since 1995 (5.5 %
per year). This transport mode keeps winning market
share (27 % in 2007 vs. 21 % in 1994) thanks to
low-cost activity development.
••
••
Present
for
the future
0
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Ministry of Ecology, Energy, Sustainable Development
and Town and Country Planning
www.aviation-civile.gouv.fr
2002
THEMATIC REPORT
100%
0,10
90%
december 2008
21%
0,11
80%
|
35%
36%
70%
0,12
60%
0,09
50%
0,06
40%
0,17
0,24
0,18
15%
0,22
20%
10%
••
F rom 1986 to 1990, passenger traffic increased at a very high
rate of 17 % per year on average mainly due to the strong
increase of flight frequencies (+20 % per year). During this same
period, passenger traffic between France and other European
countries rose by an average of 11.5 % per annum;
0,05
0,78
30%
26%
and the United Kingdom (excluding the Paris-London line) is
marked by three major phases (see figures 5 and 6):
Eurotunnel shuttles
0,49
Eurostar
Plane (France–Uk excl. Paris-London)
Plane (Paris-London)
Ferries (9 French ports)
0,39
1994
2007
••
0%
1998
F rom 1990 to 1997, traffic increased by only 4.4 % per year
on average and the number of aircraft movements increased
slightly (2.5 % per year). At the same time, passenger traffic
between France (outside Paris) and the rest of Europe 1
increased by 6.9 % per year. The slowdown in traffic can be
partly explained by the consequences of the Gulf War and
lower economic growth;
Figure 2. Distribution of cross-channel traffic by transport mode
Note: from January to October 2008, air traffic between France and UK
decreased by 1.6 % compared to the same period of 2007.
30
••
Sea transport
Rail transport
25
Air transport
F rom 1997 to 2007, traffic increased dramatically (10 % per year
on average, compared to 7.2 % for the rest of the European
Union) with growth of the airway offer - (5.8 % per year in
number of movements) - and in particular the development
of low-cost carriers whose market share rose to nearly 65 %
in 2007. However, the traffic of traditional scheduled airlines,
facing strong competition, has been decreasing since the early
2000s. The growth of traffic between France and the United
Kingdom remained steady even between 2000 and 2003,
a period during which air transport was affected by several
external events (September 2001, Iraq conflict, SARS).
20
15
10
5
0
2003
2004
2005
2006
1990
2007
1992
1994
1996
1998
2000
2002
2004
2006
Figure 3. Sea, air, and rail cross-Channel traffic
(millions of passengers)
55
Eurotunnel shuttles*
50
Eurostar
45
Air (France - UK excl. Paris-London)
40
Air (Paris-London)
...mainly departing from regional
airports, the Paris-London air connection
suffers from Eurostar competition.
Ferries (9 French ports)
35
30
25
1 2002 2003 2004 2005 2006 2007
20
The
air transport between both countries has been marked by
15
two
contrasting changes (cf. figure 4):
10
Paris-London air traffic has dropped by half: 4 million pas5
0 sengers in 1994, only 2.2 million in 2007 ;
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Air traffic
between
French
* Passengers
of vehicules
on "tourism"
shuttles regions and the UK (excluding ParisSource : SNCF, DGAC, DTMPL, Eurotunnel
London flights) increased 2.6-fold between 1997 and 2007.
••
••
12
Eurostar
10
Air (Paris-London)
3012 000 000
Sea transport
aagr 1997-2007
: +10,2%/year
Rail transport
2510 000 000
20 8 000 000
120 000
Air transport
Total
Low-cost cies
Trad cies
charter
140 000
100 000
80 000
15 6 000 000
aagr 1986-1997 : +8,9%/year
a
60 000
10 4 000 000
40 000
5 2 000 000
0
1990
0
20 000
1986
1992 1988
aagr : annual average growth rates
1990
1994
1992
1996
1994
19981996
1998
2000
2000
2002
200220042004
2006
2006
0
1986
* only passenger aircraf
Figure 5. Air traffic between France and UK
Note: from January to October 2008, air traffic between France and UK (excl.
Paris-London) grew by 1.0 % compared to the same period of 2007: +0.7 %
for low-cost compagnies, -0.01 % for traditional scheduled airlines and
+9.0 % for charter compagnies.
Air (France - UK excl. Paris-London)
8
12 000 000
aagr 1997-2007 : +10,2%/year
6
120 000
10 000 000
4
8 000 000
2
6 000 000
Total
Low-cost cies
Trad cies
charter
100 000
80 000
aagr 1986-1997 : +8,9%/year
0
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Figure 4. Air and rail cross-Channel traffic (Eurostar)
(millions of passengers)
Note: from January to October 2008: Eurostar traffic increased by 13.9 %,
air traffic between Paris and London decreased by 13.7 % and air traffic
between France and UK (excl. Paris-London) grew by 1.0 % compared
to the same period of 2007.
2. Strong growth of air traffic between
the French regions and the United
Kingdom: the role of low-cost companies
Since 1986, low-cost company traffic has posted over 10 %
growth per year. The development of air traffic between France
Ministry of Ecology, Energy, Sustainable Development
and Town and Country Planning
140 000
a
60 000
4 000 000
40 000
2 000 000
20 000
0
1986
1988
aagr : annual average growth rates
1990
1992
1994
1996
1998
2000
2002
2004
2006
Figure 6. Number of aircraft movements between France and UK
(Excl. the Paris- London line, thousands of passengers)
Note: from January to October 2008, air traffic between France and UK (excl.
Paris-London) decreased by -0.04 % compared to the same period of 2007:
-2.2 % for low-cost compagnies, -2.5 % for traditional scheduled airlines
and +19.5 % for charter compagnies.
1. International connections between France and 26 member states of the
European Union (excluding the United Kingdom) without the key competitive
TGV lines.
0
1986
* only passenger aircraft
This traffic growth has been accompanied by a sharp increase
in the number of scheduled routes 2 - which have increased
threefold between 1996 and 2007 (see figure 7) – in 2007
low-cost companies operated almost 80 routes compared to
only thirty for traditional scheduled airlines.
10 000 000
observed
9 000 000
estimated
Without low-cost cies (with a number of movements equal to 90 000 in 2005)
8 000 000
7 000 000
6 000 000
5 000 000
100
4 000 000
90
Total Scheduled
80
70
Low-cost companies
3 000 000
Traditional scheduled cies
2 000 000
60
1 000 000
50
0
40
1986
* excluding Paris-London
30
20
1988
1990
1992
1994
1996
1998
2000
2002
2004
Figure 8. Estimation of air traffic between France and UK*
with and without low-cost companies (passengers)
10
0
1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Figure 7. Number of scheduled routes2 between France and UK
(excl. the Paris-London line)
Note: from January to October 2008, nearly 70 routes are operated by lowcost compagnies and about 30 by traditional scheduled airlines.
An econometric explanation
GDP and price variables alone cannot explain the
strong growth in air traffic since 1997 3
Several econometric models were developed to explain the air traffic
between France and the United Kingdom. The best model takes into
account the average GDP of both countries by volume (GDP) and the
average price of air transport without inflation (Price TA), and also the
number of aircraft movements (Mvt) and the share of movements of
low-cost companies (Part BC). As for the models explaining the traffic
using only GDP and price of air transport variables, they underestimate
the increase in traffic between 1996 and 2005.
The price “effect" is taken into account through variables "price of
air transport" and "share of low-cost". Why doesn’t the variable
“price of air transport” alone enable to take into account the full
price effect caused by the development of low-cost companies?
Two reasons can explain this:
The calculation of average unit revenue for all companies, both
low-cost and traditional, could minimize the effect linked to
the drop in price offered by low cost companies only, which
have an average unit revenue about 30 % lower than the unit
revenue of traditional companies. The passengers’ response
would not be in line with the price changes.
The average unit revenue is calculated for the company’s entire
network. However, it is likely that traditional companies have
offered, on lines in competition with low-cost companies,
higher price reductions than on other lines. In this case, the
tariff index selected would minimize the actual price drop
between 1997 and 2005.
••
••
Apart from the price effect, the variable “share of low-cost
companies " takes into account some of the effect in relation
with the great range of offers of low-cost companies.
The model is as follows:
ln traffict = -1.62 + 1.44 ln PIBt – 0.20 ln TAt price + 0.53 ln
(6.0)
(-1.8*)
(9.6)
Mvtt + 0.64 BCt share+ ut
(5.3)
The numbers in brackets are Student ‘t’
Period: 1987-2005
Observations: 19
Adjusted R2: 0.997
Durbin-Watson: 1.82
*by applying a “boostrap” test, the elastic nature of the average air price is significantly different from 0 at a 5 % level.
Low cost companies have created extra
traffic, which accounts for one third of the
total traffic.
If there hadn’t been the low-cost companies, the number of
aircraft movements between France and the United Kingdom
(excl. the Paris-London line) would have been lower than in
2005 (116 000). The average carriage would also have been
lower. If the number of movements was 90,000, the traffic in
2005 would have decreased by 34 % compared to the traffic
observed the same year, which would correspond to a loss
of 3.1 million passengers (see figure 8). According to these
assumptions, traffic would have grown from 1996 to 2005 at
an average of 5.6 % per year instead of 10.6 %.
3. What future for the Paris-London
connection…
Before Eurostar, the growth of air traffic between Paris and
London was steady: 7 % per year between 1986 and 1994.
Between 1990 and 1994, traffic grew by only 3.2 % per year,
due in particular to the gloomy economic situation. In 1997, three
years after the launch of Eurostar, air traffic had already lost 1.2
million passengers on the Paris-London route (from 4 million in
1994 to 2.8 million in 1997), i.e. 30 % of total traffic. The traffic
then remained at about 3 million passengers per year until 2002.
With the commercial launch of the British high-speed line in
two stages (in September 2003 and November 2007), traffic
dropped to 2.2 million passengers in 2007 even with low cost
companies such as easyJet that operate four times with flights
going there and back between Roissy and Luton. Meanwhile,
Eurostar traffic grew from 6 million passengers in 1997 to over
8 million in 2007, this transport mode attracts nearly 80 % of
the Paris-London travellers. (see figure 9).
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
1994
2. Airport-airport connections - only the routes with over 240 return flights
per year.
3. Traffic France-UK excluding Paris-London.
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
Figure 9. Paris and London Eurostar market share
( % in the air traffic and Eurostar)
32
…as the Eurostar has diverted nearly
With increasing competition from the
5 million passengers from air in 2007
Without Eurostar, air traffic between Paris and London would
have been higher than 7 million passengers in 2007: traffic
loss due to the launch of the Eurostar is estimated at about 5
million passengers (see figure 10). With 2.2 million passengers
a year, in 2007 the Paris-London line lost its position as the first
international air connection departing from France, in terms of
traffic volume. The Paris-Madrid line (2.3 million passengers in
2007) has now overtaken the Paris-London line.
8,0
Orly
CDG
7,0
6,0
+4,6% per year without Eurostar
Traffic diverted from
plane to Eurostar *
Diversion
+4,6% per year without
Eurostar rate *
ParisLondon
Orly
Eurostar
Time
7,0
Loss : approx 5 million
passengers in 2007
+11% / year
4,0
Since the 14 November last year, London is only 2h15 from Paris
with Eurostar, instead of 2h35, Saint-Pancras being the new
London Eurostar terminal instead of Waterloo. This twenty minute
reduction in the journey time should cause an approximate
diversion rate of air passengers to Eurostar of 15 % 4. By taking
into account the drop of traffic observed before November
2007 and the improvement of the Eurostar offer, the flow of
air passengers between Paris and London should reach 1.76 to
1.90 million passengers in 2008 (figure 11).
8,0
+7% / year
5,0
Eurostar since November 2007, air traffic
should fall by 15 % to 20 % in 2008
CDG
6,0
+7% / year
2,0
20 minutes time
2008
5,0
+11%saving
/ year
(2h15
4,0
instead of 2h35)
1,0
3,0
3,0
About
300 000
to 350 000
passengers
15 %
Loss : approx 5 million
passengers in 2007
2,0
Drop by 15% to 20%
of the traffic btw
2007 and 2008
2,0
Nearly one third of the Paris-London
line passengers have connecting
flights departing from Paris
or London.
observed
1,5
2,5
2007
2006
2005
2004
Drop by 15% to 20%
of the traffic btw
2007 and 2008
forecasted (high scenario)
forecasted (low scenario)
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
1988
2,5
(millions
of passengers)
* Traffic
loss (relative and absolute value) compared with the base situation
0,0
equals the lack of improvement of the Eurostar offer. This calculation is based
on the assumption that easyJet continues using the Paris-Luton line.
1986
Figure 10. Air traffic between Paris and London
The impact of the improved Eurostar offer on Paris-London air
1,0
traffic
in 2008
1987
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
1988
1987
1986
0,0
2,0
observed
1,0
1,5
forecasted (high scenario)
forecasted (low scenario)
0,5
1,0
These customers are less interested in the Eurostar
0,0
offer,
which does not serve Heathrow or Roissy
2007
2008
directly
0,5
0,0
Millions
of passengers
Distribution
Traffic origin-destination
1,6
69 %
Interconnecting passengers in Paris or London
0,7
31 %
Paris-London Line
2,4
100 %
2007
Figure 11. Air traffic between Paris and London
(millions of passengers)
The OD traffic and the interconnections on the Paris-London
airline in 2006
Source: MIDT
2008
4. This diversion rate was calculated with a logit model explaining the plane/
train market share from times, frequencies and fares of both modes and
by differentiating the OD traffic and the interconnecting air passengers.
The traffic caused by the improvement of the railroad offer was also taken
into account in the calculations. This diversion rate is the variation of the
traffic between the base situation (without improvement of the railway
offer) and the project situation (with improvment of the railway offer)
in 2008.
For this last issue of the "notes thématiques de la Dast "which will soon be back in a new format, I would like thank the whole team
of "Prospective et veille stratégique" led by Elisabeth Bouffard-Savary, who was determined to combine, in these documents, a
recent and "thorough" analysis of the major themes of civil aviation in the most communicating way possible, thanks especially to
the valuable help of the DGAC’s communication team.
Philippe Ayoun,
Deputy Director
Sub Directorate of Studies, Statistics and Foresight
Direction générale de l'Aviation civile – Direction du Transport aérien – 50 rue Henry Farman - 75720 Paris cedex 15
www.aviation-civile.gouv.fr – Phone: 00 33 1 58 09 49 54 – Fax: 00 33 1 58 09 48 49
Publisher: Paul Schwach – Chief Redactor: Elisabeth Bouffard-Savary – Redactor: Franck Lisio –Layout: Raphaëlle Vial – Printing: French Civil Aviation
www.developpement-durable.gouv.fr