How London City Airport

Whenever you meet Richard Gooding, London City Airport’s relaxed-looking chief executive, you can’t help feeling he has seen it all before – and after clocking up 42 years in the airline business, he probably has.

Aged just 18, Gooding left rural Suffolk to work as an apprentice for British European Airways – which later became part of British Airways – and he was worked in commercial aviation based all over the world ever since.

At 62, Gooding’s staying power is noteworthy. He has been in charge of London City for 14 of the 22 years that the airport has been open, and has worked under several different owners.

Gooding bustles his heavyset 6’ 2” frame into a meeting room at the airport’s functional beige and blue headquarters a stone’s throw away from the runway. He is in jovial mood, but he is keenly aware of how badly the downturn – which has led to unsold seats, discounting and capacity cuts – has hit air travel.

Recent figures show that in April economy fares fell 15 per cent and premium fares were down more than 20 per cent around the world compared with the same period last year, according to International Air Transport Association (IATA).

In Europe, business and first class traffic fell 33.6 per cent.

These dire numbers prompted IATA to almost double its projected losses for the industry for 2009 to $9bn (£5.5bn).

Gooding says: “We are in uncharted waters. Never since the Second World War have we seen such a serious decline across the whole of the economy. The impact on air travel has been significant.”

He adds: “We must keep our costs under control. We are keeping a tight control on cash.” The airport, which handled 3.3m passengers last year (a 12 per cent rise on 2007), expects to see passenger numbers fall 10 per cent this year.

Gooding has frozen staff numbers at 400, although the airport – which is ideal for Canary Wharf and only seven miles from the City – indirectly provides work for another 2,500 in the Docklands.

Over the last five years the business had spent £30m building new aircraft stands and another £20m installing a new baggage system, doubling the size of the departure area in its terminal building. It has also increased its private jet capacity. But now Gooding says: “We are not going forward with any more big capital spending programmes at the moment.” 

However, 2007 – the most recent figures for the private firm – was a stellar year for the business. Its full-year figures rocketed 94 per cent to £33.4m on the back of a double-digit increases in passenger numbers.

Gooding accepts those heady days are beyond the airport this year, but he is already looking towards growth returning in 2010. He says: “Travel will creep back. People do business face to face.”

The brightest spot on the airport’s horizon this year is the British Airways (BA) business class-only launch from London City to New York JFK on 29 September.

This will see the British flag carrier flying modified Airbus A318s with 32 flatbed seats twice a day across the Atlantic with a check-in time of just 15 minutes. The aircraft will take off from City’s runway, which is only 1,199 meters long, about a third as long as Heathrow or Gatwick.

Gooding is clearly looking forward to the launch. He says: “It’s good that BA are launching something innovative. There is not a lot of good news around at the moment.” Gooding hopes the BA launch will lead other airlines to begin other medium-haul services to destinations like Moscow and Dubai. He says: “This could be a beacon for other carriers to follow.”

Gooding wants to get into this market because trains have eaten away at the short haul markets the airport was originally built on. He says: “Rail gives us a lot of competition on routes to Paris, Brussels, the northwest and the northeast of England. We are at the point where rail has knocked us out of many of these markets. But we hope to open up a range of new medium-haul routes.”

Gooding has also seen off one ultra-hostile Mayor and looks to have the present one, who is much more supportive but would like to increase competition for City, on the back foot. Former Mayor Ken Livingstone had argued that when the £16bn London east-west rail link Crossrail is built in 2016, easier access to Heathrow would mean there is no need for London City, and that the 130-acre site should be used for housing.

Gooding always attacked this as “garbage” – a point of view shared by most in London’s business community –  saying that Heathrow simply cannot take more passengers. This plan ended with Ken’s mayoralty. Boris Johnson said when he ran for office that a new airport should be built in the Thames Estuary, replacing expansion at Heathrow but adding to the competition in east London. However, since then Johnson has said little on this matter, partly, critics suspect, because this is not in tune with national Tory transport policy.

Gooding says: “The Thames Estuary project would have been great two to three years ago. But the green issues, the physical practicalities, and the money involved all rule this project out today.”

Gooding’s burly figure has long been a fixture at the airport that was built by builders Mowlem and first began to operate on 26 October 1987.

Irish financier Dermot Desmond bought it for £23.5m in 1995, built it up, and took advantage of the desire for infrastructure assets by selling it on to a joint venture of American Insurance Group (AIG) and Global Infrastructure Partners (GIP) for £750m in 2006. But when AIG fell under US government control last year it sold its 50 per cent stake in the airport to GIP and private equity firm Highstar Capital.

Gooding was first brought to the airport by Desmond in 1996. Before that he worked for 15 years at BA in a variety of posts, including as its area manager in Jordan. He became operations director at Manchester Airport in 1981 for four years, before founding ground-handling firm Ogden Allied.
Gooding left to become chief executive of Luton Airport in 1991. He was lured away by Desmond five years later.

City built its reputation around being a convenient short haul business operation. The growth of high speed rail means the airport will have to look further afield, putting it in greater competition with Heathrow, Gatwick and Stansted. Gooding is confident the intimate service his airport offers will keep it ahead of the pack.

Airlines offer a 20-minute check-in time for passengers with hand luggage and a minimum of 30 for those with luggage.

A “no-queues” policy means the average time for a passenger to process security takes two minutes. As long as it can keep this up – and Gooding will have to show he can cope with much larger passenger volumes –  City’s future looks assured.

Work: 1966 – apprentice, overseas sales and management, passenger and ramp handling, British European Airways (later  British Airways); 1981 – ramp handling then operations director, Manchester Airport; 1985 – founder then managing director, Ogden Allied ground-handling business; 1991 – chief executive, Luton Airport; 1996 – chief executive, London City Airport

Hobbies: He loves music, still goes to concerts and is an avid Eric Clapton fan: “I have every record he has recorded.”