Worldwide exports top East Anglia's business agenda as Brexit looms
PUBLISHED: 09:42 27 June 2018 | UPDATED: 09:42 27 June 2018
While Heathrow’s plans for a third runway are about to take off, to the East, Stansted Airport is eyeing up its own grand own expansion plans – and many local companies are hoping to prosper from it.
While Heathrow’s plans for a third runway are about to take off, to the East, Stansted Airport is eyeing up its own grand own expansion plans - and many local companies are hoping to prosper from it.
In the last 12 months, Stansted has added routes to Dubai, New York, Boston, Toronto, Tel Aviv, Frankfurt, Reykjavik and Corsica, and the latest Airports Council International (ACI) Europe annual Airport Industry Connectivity Report shows that London Stansted recorded a 43 per cent increase in the number of direct flights offered from the airport since 2013. Stansted’s chief executive, Ken O’Toole, says his airport could add 25 to 30 more long-haul routes in three-to-five years.
While the new routes might be good news for holidaymakers, they also throw up potential new business opportunities for local businesses, especially those in the business of exporting. London Stansted Airport’s cargo volumes are at record levels - 261,400 of freight was shipped from Stansted in the 12 months ending May 2018, worth approximately £14bn.
Stansted is the busiest airport for all-freighter traffic among the London airports, and transports thousands of tonnes of textiles, fruit and vegetables, electronics, pharmaceuticals, mail, horses and Formula One equipment to destinations in nearly every continent.
Steve Elsom, regional director for SME banking at Lloyds Bank Commercial Banking, says firms across the region should start thinking about the opportunities that Stansted’s expansion could bring for exporting.
“International demand for East of England made goods is showing no signs of slowing down,” he said. “The latest figures from HMRC showed that the value of goods produced in the region exported overseas rose by 3.9% to £28.7bn in the last 12 months.
“With more than 11,000 exporters in the region and long-term plans to boost connectivity, exporting should be at the top of the agenda. Doing so is challenging, but fortunately there is a wealth of support available to businesses looking to export to help them identify the best targets and maintain a steady cash flow while growing.”
China Southern Airlines has been flying a cargo link to China for the last three years, in part tapping into Chinese demand for UK-made ‘Brand Britain’ goods. Last month, Stansted established the East of England-China Forum to help build the business case for direct flights to China.
LinksEast is a PR service founded to enable communication and trade between SMEs in East Anglia interested in trading in and with China.
Its director, Annie Eaves, explained how they’re linking Norfolk and Suffolk-based companies in to Guangdong province - “which is the size of Britain, and its like Silicon Valley,” she explained. “We already have a very good relationship with its capital, Shenzhen, and we are building on our links with Southern China University of Tech.”
China Nuclear Power Group, which has interests in Sizewell C and Bradwell B, is based in Schenzhen, as is Huawei Telecoms, which has just joined forces with Martlesham-based BT to conduct a cutting-edge research and development programme on 5G network slicing.
If Stansted does launch passenger flights to China, it could benefit the University of East Anglia, which currently has 1,200 of their 17,000 students coming from mainland China.
“The development of new routes into and out of our region would offer more travel choice for the thousands of international and UK students at our university,” said Karen Blackney, head of the international office at UEA. “We would also hope that better air travel links to the area would encourage more prospective students to consider UEA when deciding upon a university.”
And while Tiptree jam manufacturers Wilkins & Sons ship most of their products by sea, its joint managing director Scott Goodfellow is also backing a direct link from Stansted to China.
“Securing a direct link to China from Stansted, our local airport, would support our export ambitions, encourage local tourism, and save valuable time commuting around the M25,” he explained. “There’s an increasing demand for high quality British foods with heritage and provenance. Europe, North America, and Commonwealth countries have always been good markets (for us), and more recently we have seen strong growth in China. Our most recent venture is to Kazakhstan, where you can now find little jars of Tiptree jam on the breakfast table in fine hotels.”
George Chairman of the Haven Gateway Partnership, which promotes economic opportunities to the East of England, says Stansted’s new incontinental routes to New York, Boston and Toronto are particularly important for a post-Brexit Britain. “Already this morning, the first legal challenge has been submitted against Heathrow’s third runway, making the need for Stansted’s expansion even greater,” he said. Managing director of Ipswich Wharf Developments Ltd John Howard hopes that the expansion of Stansted will boost Ipswich’s “understated position” in the UK.
But Stansted’s aviation development manager Conan Busby, believes that the companies with the most to gain from new services out of Stansted are those on the London – Stansted – Cambridge corridor, particularly those invested in pharmaceuticals. “Emirates is very committed to its pharmaceuticals products and given Cambridge’s reputation as a centre of excellence for pharmaceuticals and life sciences, it will be well positioned to support this sector,” he explained. “There are several freight forwarders in the region, such as DHL, Bollore, UPS and Woodland Group, that will now benefit from having Middle Eastern services which of course enables seamless connectivity onwards to Asia, Africa, Australasia and the Indian Sub-Continent.”
While flying cargo by plane is ideal for companies requiring temperature-controlled conditions and rapid transport, for most, it can prove to be prohibitively expensive. Nigel Wood, managing director of the Great Blakenham-based loudspeakers company Celestion, explained that his loudspeakers are shipped from Felixtowe, “which works out 20 times cheaper than flying them.” But Mr Wood, whose customer base predominantly lives in the US, says he would like to see Stansted’s passenger planes venturing further afield. “The problem with Stansted is its too Europe-centric and needs to reach out further. I still have to fly to LA from Heathrow, which can be a real pain because of the risk of traffic.”
Another local company gaining an international customer base is Fairfields farm crisps, which now export 15-20% of their crisps across the world from their farm in Wormingford. The company’s chief executive Robert Strathern explained: “The majority of our crisps go into 40ft containers which are then shipped from Felixstowe or Tilbury. If we ship crisps in a container it can take two to four weeks to arrive anywhere in the world, it is much more cost effective per unit shipped than airfreight for crisps. Airfreight is more suited to fresh short shelf life products.”
Stansted Airport has submitted an application to raise a capacity cap to 43m travelers from 35m, and is spending £600m on new terminal facilities. But this expansion would come at a heavy cost, according to the chairman of the campaign group Stop Stansted Expansion, Peter Sanders. “It does not need a rocket scientist to work out that a 44% increase in the number of flights and a 66% increase in the number of passengers means a lot more noise, pollution and traffic on our already congested local roads. By suggesting otherwise, as they have done, Stansted Airport and its owners, Manchester Airports Group (MAG) are treating the local community as if we were all complete fools.”