Third runway at Hong Kong International Airport ‘going to be needed’ - Cathay Pacific
Jul 12, 2011, 4:20 am
#151
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So none of us really know?
Having read through this thread again, I see that basically we are all posting here with strong opinions one way or the other, and none of us have a shred of proof to support these. Yes, we have arguments of varying strengths. Yes, we have the report/proposal from the Government of HK to lean on. And, yes, both have their cons. What we don't have is independent long-term views of how airtraffic and, not least, airspace will look like.
Until we know how airspace will be managed, have better estimates of what it will cost and what the geniune alternatives are, I will hold back further opinions from my side. My only hope is that no construction is contemplated until we KNOW that flights on the third runway will not run into a Chinese wall in airspace, and we KNOW what the cost will be.
My two cents...
Until we know how airspace will be managed, have better estimates of what it will cost and what the geniune alternatives are, I will hold back further opinions from my side. My only hope is that no construction is contemplated until we KNOW that flights on the third runway will not run into a Chinese wall in airspace, and we KNOW what the cost will be.
My two cents...
Jul 13, 2011, 5:18 am
#152
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Article from the Chairman of the HKAA (Marvin Cheung) in this month's HK Inst of CPA's journal. Cheung is a past president of the HKICPA and the former senior partner of Big4 firm KPMG.
http://app1.hkicpa.org.hk/APLUS/2011...coverstory.pdf
90.6% more passengers and 96.4% more takeoffs and landings?
What kind of landing fees are we going to charge in order to encourage such growth? The same level as is now, not adjusted for 20 years' inflation?
There are opportunity costs to building this runway - for instance public medical funding. It has to provide some form of tangible benefit.
I was hoping for a bit more disclosure from my former big boss. Maybe I should read the consultation paper, but I have to read that after interim reporting.
http://app1.hkicpa.org.hk/APLUS/2011...coverstory.pdf
Last year the airport handled 50.9 million passengers, 4.1 million tonnes of cargo and 306,500 take-offs and landings. By 2030 these numbers are expected to increase to 97 million passengers, 8.9 million tonnes of cargo and 602,000 air traffic movements.
...So Cheung has put forward two options. The first involves maintaining the current two runways, but investing an estimated HK$42.5 billion (adjusted for inflation) in terminal and apron facilities, including a new passenger concourse, automated people movers and baggage handling systems. This, the authority warns, is a Band-Aid solution because it doesn’t address the fundamental lack of runway capacity.
The second – preferred, but far more expensive – option is to reclaim about 650 hectares of sea to build a third runway. This would take capacity up to a maximum of 620,000 flight movements a year, which could maintain Hong Kong’s position as a network hub possibly beyond 2030.
...While the authority generated HK$9 billion in turnover in 2009-10, building the third runway would be beyond its means, especially since it is already expanding the airport’s mid-field.
Solutions include reducing the dividend it pays the government, asking the government to cover the funding gap by injecting capital, advancing further the user-pay principle or finding other financing solutions. It will discuss all of these with the government if the consultation concludes in favour of the new runway."
...So Cheung has put forward two options. The first involves maintaining the current two runways, but investing an estimated HK$42.5 billion (adjusted for inflation) in terminal and apron facilities, including a new passenger concourse, automated people movers and baggage handling systems. This, the authority warns, is a Band-Aid solution because it doesn’t address the fundamental lack of runway capacity.
The second – preferred, but far more expensive – option is to reclaim about 650 hectares of sea to build a third runway. This would take capacity up to a maximum of 620,000 flight movements a year, which could maintain Hong Kong’s position as a network hub possibly beyond 2030.
...While the authority generated HK$9 billion in turnover in 2009-10, building the third runway would be beyond its means, especially since it is already expanding the airport’s mid-field.
Solutions include reducing the dividend it pays the government, asking the government to cover the funding gap by injecting capital, advancing further the user-pay principle or finding other financing solutions. It will discuss all of these with the government if the consultation concludes in favour of the new runway."
90.6% more passengers and 96.4% more takeoffs and landings?
What kind of landing fees are we going to charge in order to encourage such growth? The same level as is now, not adjusted for 20 years' inflation?
There are opportunity costs to building this runway - for instance public medical funding. It has to provide some form of tangible benefit.
I was hoping for a bit more disclosure from my former big boss. Maybe I should read the consultation paper, but I have to read that after interim reporting.
Last edited by percysmith; Jul 13, 2011 at 5:27 am
Jul 13, 2011, 9:52 am
#153
Join Date: May 2009
Posts: 6,978
Until we know how airspace will be managed, have better estimates of what it will cost and what the geniune alternatives are, I will hold back further opinions from my side. My only hope is that no construction is contemplated until we KNOW that flights on the third runway will not run into a Chinese wall in airspace, and we KNOW what the cost will be.
My two cents...
What we DO KNOW is that HKIA is growing (a good thing) and growing so fast that the capacity will run out down the road (a very good thing), and by NOT building a Third Runway HKIA will be consider stagnant and many businesses, pax, and cargo traffic will move to places with airports that can accommodate their needs.
Jul 13, 2011, 8:23 pm
#154
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I love HK, but...
Their track-record is not, shall we say, stunning? Disney? Stonecutter's Island bridge, aka the bridge to nowhere? MTR is much vaunted, but only because it got significant land-grants essentially for free. I'm just trying to think of a reasonably recent infrastructure project that the HK government got right. And still thinking. Yes, there is so much to love about this city, but the ability of anyone from the authorities to do anything like long-term planning is not one of them.
5 years from now, it is a fair bet that at least one carrier from across the border will have managed to up its game to a level where it is service-wise competitive with its peers in Asia. Whether we like it or not, once that happens, more people will start flying directly. Yes, the overall pie is still growing, but the time may have come for HK airport to be more clear on just what it wants to be - and be the best at it. Best does not always equal larger.
I still fail to see anyone actually coming up with an in-depth analysis on the competitive landscape for both cargo and pax, covering the south China area. Linear projections won't suffice in this kind of rapidly developing arena.
Jul 13, 2011, 9:21 pm
#155
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Got this in my mailbox this morning and i had to open it up.
http://www.economist.com/node/189285...ement_thinking
how stable does this make china a place for people to invest in? nothing is protected!
Jul 13, 2011, 9:23 pm
#156
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Ummm... Well....
Their track-record is not, shall we say, stunning? Disney? Stonecutter's Island bridge, aka the bridge to nowhere? MTR is much vaunted, but only because it got significant land-grants essentially for free. I'm just trying to think of a reasonably recent infrastructure project that the HK government got right. And still thinking. Yes, there is so much to love about this city, but the ability of anyone from the authorities to do anything like long-term planning is not one of them.
I still fail to see anyone actually coming up with an in-depth analysis on the competitive landscape for both cargo and pax, covering the south China area. Linear projections won't suffice in this kind of rapidly developing arena.
Their track-record is not, shall we say, stunning? Disney? Stonecutter's Island bridge, aka the bridge to nowhere? MTR is much vaunted, but only because it got significant land-grants essentially for free. I'm just trying to think of a reasonably recent infrastructure project that the HK government got right. And still thinking. Yes, there is so much to love about this city, but the ability of anyone from the authorities to do anything like long-term planning is not one of them.
I still fail to see anyone actually coming up with an in-depth analysis on the competitive landscape for both cargo and pax, covering the south China area. Linear projections won't suffice in this kind of rapidly developing arena.
Jul 13, 2011, 9:56 pm
#157
Join Date: Jan 2011
Posts: 2,345
I fail to understand the complete lack of faith given to not only the Hong Kong Airport Authority, but Hong Kong as a city and financial center. No one doubts the rapid growth of the Chinese market which has propelled China to a global superpower, but why does that always seem to result in Hong Kong becoming a deserted city, with the interests shifting to Beijing and Shanghai?
Hong Kong has always been reliable. It has a stable financial and judicial system in place, and will continue to have one for the foreseeable future. It is still an attractive place to do business for foreigners, but in recent years they have been coming from China rather than from the United States or the United Kingdom. HK will always have its draw in terms of being a business hub, and perhaps in the future Shanghai will be stronger, but that is due to the rapid growth of Shanghai and China, and not because of a decline in HK. It's easier when things are put into perspective.
So let's focus on the issue of the third runway, and not bank our hopes on the decline of a world city that has been tried and tested in the many years before.
Hong Kong has always been reliable. It has a stable financial and judicial system in place, and will continue to have one for the foreseeable future. It is still an attractive place to do business for foreigners, but in recent years they have been coming from China rather than from the United States or the United Kingdom. HK will always have its draw in terms of being a business hub, and perhaps in the future Shanghai will be stronger, but that is due to the rapid growth of Shanghai and China, and not because of a decline in HK. It's easier when things are put into perspective.
So let's focus on the issue of the third runway, and not bank our hopes on the decline of a world city that has been tried and tested in the many years before.
Jul 13, 2011, 10:12 pm
#158
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TMK, at $28 billion (USD), HKIA remains the single most expensive infrastructure project in the history of man kind (in the US, many people complained about the "big dig" in Boston, but HKIA trumps that project 2 fold; while those guys may be smart, they aren't afraid to spend your money (to be fair, the budget for HKIA was approved immediately prior to the "handover", so the project made sense at the time... no need to give Big Brother an extra $28 billion).
Jul 13, 2011, 10:19 pm
#159
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I've just been thinking in my coffee break, how good will it be if the HKG-SZN link is actually built as an extension of the AEL? So we can get to SZN from Central or West Kowloon?
Don't quarantine the train, put both PRC and HK immigration and customs on the SZN end. Yes it might not be very convenient for transfer passengers, but we don't like them anyway, don't we?
It'll be a lot more beneficial for HK residents. SZN acts like a big domestic airport for HK and HKG. It'll make me want to use SZN more.
But after we get that link, is there the 90/96% growth Marvin Cheung alluded to in the HKICPA article? I doubt!
Don't quarantine the train, put both PRC and HK immigration and customs on the SZN end. Yes it might not be very convenient for transfer passengers, but we don't like them anyway, don't we?
It'll be a lot more beneficial for HK residents. SZN acts like a big domestic airport for HK and HKG. It'll make me want to use SZN more.
But after we get that link, is there the 90/96% growth Marvin Cheung alluded to in the HKICPA article? I doubt!
Jul 14, 2011, 1:54 am
#160
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Jul 14, 2011, 5:20 am
#161
Join Date: May 2009
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TMK, at $28 billion (USD), HKIA remains the single most expensive infrastructure project in the history of man kind (in the US, many people complained about the "big dig" in Boston, but HKIA trumps that project 2 fold; while those guys may be smart, they aren't afraid to spend your money (to be fair, the budget for HKIA was approved immediately prior to the "handover", so the project made sense at the time... no need to give Big Brother an extra $28 billion).
As for comparing it with Bridge to nowhere, again, apples and oranges. HKIA, despite its ridiculous price tag, is a major success (constantly voted the best Airport of the world, efficiently moving millions of people a day, etc.) If governments around the world can deliver more HKIA rather than real wastes, I'll take HKIA any day.
Jul 14, 2011, 6:54 pm
#162
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What we DO KNOW is that HKIA is growing (a good thing) and growing so fast that the capacity will run out down the road (a very good thing), and by NOT building a Third Runway HKIA will be consider stagnant and many businesses, pax, and cargo traffic will move to places with airports that can accommodate their needs.
HK has cemented its place as the (or one of the) top cities in the Asia Pac. This runway won't go to waste.
Jul 15, 2011, 1:41 am
#163
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I think, put it this way. HK Govt has been used to spending without thinking of the result. Sometimes it works out (HKIA) and sometimes not (Route 10) and people tend to refuse the former projecta due to bad reputation (of the latter)
to cry wolf syndrom. too bad for the HK govt.
to cry wolf syndrom. too bad for the HK govt.
Jul 15, 2011, 6:58 am
#164
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last week in SCMP was the article below showing how local salaries in Shenzhen are now HKD 4000 a month so industries are relocating further north.
This will seriously affect airfreight goods shipped to HK.
This will affect CX and DHL’s hub venture.
If they are so sure the runway is required contrary to current signs they should pay for it.
The electronics companies are moving and Shenzhen’s second runway is now open. UPS has its Asia hub there.
Cargo is down for the third successive month in Hong Kong airport.
The third runway elsewhere in the NT was proposed by the ex director of Civil Aviation - seemingly this was not even included in the AAHK submission.
Then there is the EIA which every Green Group in Hong Kong will oppose.
4pc pay rise to speed up exit from Shenzhen
Border city's days as a low-cost manufacturing hub are over thanks to rising labour costs that force firms out; instead, it looks to hi-tech future
Denise Tsang
Jul 13, 2011
www.scmp.com
Shenzhen wages have risen four per cent this year to an average of 3,326 yuan (HK$4,000) a month, increasing pressure on traditional industries to move to cheaper locations.
The figure comes from the municipal government's Labour and Social Security Bureau, and is based on a survey of salaries in 20 industries. It will be a benchmark, to be used as a reference for corporate pay rises and firms' contributions to social security and employee insurance funds.
Manufacturers and human resources experts said the rise confirmed Shenzhen's position as one of the mainland's most expensive production bases. The city has the highest minimum wage on the mainland. They said it showed that Shenzhen's days as a low-cost manufacturing stronghold are over. "We do not have to wait for five years to see it transformed into a management-driven multinational base or a logistics distribution hub," said Hong Kong Garment Manufacturers Association chairman Willie Fung Wai-yiu.
Shenzhen said in its current five-year plan.............. that it wants to turn itself into a hi-tech production hub,..........Fung is the chairman of bra maker T--. He said the group's factory in Shenzhen paid, on average, a monthly wage of nearly 3,000 yuan.
In April, Shenzhen raised minimum pay by 20 per cent to 1,320 yuan, outstripping a 14 per cent rise, to 1,280 yuan, in Shanghai.
"Hong Kong factories moved across the border in the 1980s when its workers were paid about HK$4,000 on average," ......... "Shenzhen's salary situation is like that of Hong Kong in the 1980s. Factories are being pushed out of the city into more remote parts of the country or even elsewhere in Southeast Asia."
Nelson Siu Nai-sun, president of the Hong Kong Professionals and Executives Association, said ............ salaries were just one factor.
"Higher pay is a basic requirement. On top of that, they want better career prospects and a comfortable working environment," Siu said............., means a prospect of more increases in wages."
The central government stipulated in its 2011-2015 plan that the mainland's minimum wage should grow by at least 13 per cent annually, with a minimum 20 per cent rise per year in affluent provinces like Guangdong.
This will seriously affect airfreight goods shipped to HK.
This will affect CX and DHL’s hub venture.
If they are so sure the runway is required contrary to current signs they should pay for it.
The electronics companies are moving and Shenzhen’s second runway is now open. UPS has its Asia hub there.
Cargo is down for the third successive month in Hong Kong airport.
The third runway elsewhere in the NT was proposed by the ex director of Civil Aviation - seemingly this was not even included in the AAHK submission.
Then there is the EIA which every Green Group in Hong Kong will oppose.
4pc pay rise to speed up exit from Shenzhen
Border city's days as a low-cost manufacturing hub are over thanks to rising labour costs that force firms out; instead, it looks to hi-tech future
Denise Tsang
Jul 13, 2011
www.scmp.com
Shenzhen wages have risen four per cent this year to an average of 3,326 yuan (HK$4,000) a month, increasing pressure on traditional industries to move to cheaper locations.
The figure comes from the municipal government's Labour and Social Security Bureau, and is based on a survey of salaries in 20 industries. It will be a benchmark, to be used as a reference for corporate pay rises and firms' contributions to social security and employee insurance funds.
Manufacturers and human resources experts said the rise confirmed Shenzhen's position as one of the mainland's most expensive production bases. The city has the highest minimum wage on the mainland. They said it showed that Shenzhen's days as a low-cost manufacturing stronghold are over. "We do not have to wait for five years to see it transformed into a management-driven multinational base or a logistics distribution hub," said Hong Kong Garment Manufacturers Association chairman Willie Fung Wai-yiu.
Shenzhen said in its current five-year plan.............. that it wants to turn itself into a hi-tech production hub,..........Fung is the chairman of bra maker T--. He said the group's factory in Shenzhen paid, on average, a monthly wage of nearly 3,000 yuan.
In April, Shenzhen raised minimum pay by 20 per cent to 1,320 yuan, outstripping a 14 per cent rise, to 1,280 yuan, in Shanghai.
"Hong Kong factories moved across the border in the 1980s when its workers were paid about HK$4,000 on average," ......... "Shenzhen's salary situation is like that of Hong Kong in the 1980s. Factories are being pushed out of the city into more remote parts of the country or even elsewhere in Southeast Asia."
Nelson Siu Nai-sun, president of the Hong Kong Professionals and Executives Association, said ............ salaries were just one factor.
"Higher pay is a basic requirement. On top of that, they want better career prospects and a comfortable working environment," Siu said............., means a prospect of more increases in wages."
The central government stipulated in its 2011-2015 plan that the mainland's minimum wage should grow by at least 13 per cent annually, with a minimum 20 per cent rise per year in affluent provinces like Guangdong.
Jul 15, 2011, 7:06 pm
#165
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The sky's the limit
Proceeding with the third runway is pointless if nothing is done to increase local airspace capacity Albert Cheng
Updated on Jul 16, 2011
www.scmp.com
What lies at the heart of the debate of whether Hong Kong International Airport should build a third runway to keep the city's position as an international aviation hub is not hardware capacity or airspace boundary; but the airport's ability to increase aircraft movements.
First and foremost, we must boost our capacity to handle more landings and take-offs to cope with increasing air traffic. Failing to do so would mean falling behind our neighbouring rivals.
In theory, having an extra runway should put the city ahead of other airports and enhance its competitive edge. The runway's current estimated price tag of HK$136.2 billion, while high, is certainly within Hong Kong's means. But we should not go ahead with the project unless we are absolutely sure that it is worthwhile. We are racing against time to meet rapidly rising air traffic demand. Even if we could get the green light to start building the new runway tomorrow, the project would take between eight and 10 years to complete.................
Our priority is airspace capacity. With the nearby Shenzhen airport expanding so rapidly, it is very likely that our airspace capacity will be pushed to the limit in the near future................. In short, having all the additional hardware in place 10 years from now will be pointless if we no longer have the airspace available to match the expansion.
....................
The International Air Transport Association has found a correlation between GDP growth and an increase in air traffic. With GDP forecast to continue growing in the coming years, passenger traffic is also likely to rise. This means there will be tough competition for airspace in the region.
Hence, it is critically important that our airport takes action to boost its capacity to handle more aircraft movements. On average, Shenzhen airport's single runway, one of the world's busiest, handles more than 500 flights per day while Hong Kong's average is more than 800.
However, we have to bear in mind that a substantial portion of our air traffic goes through the mainland, .......................competing for the allocation of more airspace.
In other words, if we want to get more airspace, we must first make sure we have the additional capacity to fill up the extra quota.
First, we need to maximise our dual-runway system. Instead of permitting one runway for landings and one for departures, we should lift the restriction to optimise usage. Had we applied a bit of flexibility, we could have easily raised aircraft movements to 1,200 per day......................
Albert Cheng King-hon is a political commentator. [email protected]
(and former HKG Legislator)
Proceeding with the third runway is pointless if nothing is done to increase local airspace capacity Albert Cheng
Updated on Jul 16, 2011
www.scmp.com
What lies at the heart of the debate of whether Hong Kong International Airport should build a third runway to keep the city's position as an international aviation hub is not hardware capacity or airspace boundary; but the airport's ability to increase aircraft movements.
First and foremost, we must boost our capacity to handle more landings and take-offs to cope with increasing air traffic. Failing to do so would mean falling behind our neighbouring rivals.
In theory, having an extra runway should put the city ahead of other airports and enhance its competitive edge. The runway's current estimated price tag of HK$136.2 billion, while high, is certainly within Hong Kong's means. But we should not go ahead with the project unless we are absolutely sure that it is worthwhile. We are racing against time to meet rapidly rising air traffic demand. Even if we could get the green light to start building the new runway tomorrow, the project would take between eight and 10 years to complete.................
Our priority is airspace capacity. With the nearby Shenzhen airport expanding so rapidly, it is very likely that our airspace capacity will be pushed to the limit in the near future................. In short, having all the additional hardware in place 10 years from now will be pointless if we no longer have the airspace available to match the expansion.
....................
The International Air Transport Association has found a correlation between GDP growth and an increase in air traffic. With GDP forecast to continue growing in the coming years, passenger traffic is also likely to rise. This means there will be tough competition for airspace in the region.
Hence, it is critically important that our airport takes action to boost its capacity to handle more aircraft movements. On average, Shenzhen airport's single runway, one of the world's busiest, handles more than 500 flights per day while Hong Kong's average is more than 800.
However, we have to bear in mind that a substantial portion of our air traffic goes through the mainland, .......................competing for the allocation of more airspace.
In other words, if we want to get more airspace, we must first make sure we have the additional capacity to fill up the extra quota.
First, we need to maximise our dual-runway system. Instead of permitting one runway for landings and one for departures, we should lift the restriction to optimise usage. Had we applied a bit of flexibility, we could have easily raised aircraft movements to 1,200 per day......................
Albert Cheng King-hon is a political commentator. [email protected]
(and former HKG Legislator)