Part of the debate – in the House of Commons at 12:00 am on 3rd August 1978.

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Photo of Mr Leslie Huckfield Mr Leslie Huckfield , Nuneaton 12:00 am, 3rd August 1978

I fully recognise that point. That is why it has been very carefully taken into consideration. But I am sure that my hon. Friend will recognise that the major purchase and procurement decisions which are about to be taken by airlines are, in fact, subsonic ones. But we have other airlines interested, as my hon. Friend has said, and the decision last year of Singapore Airlines to go into partnership with British Airways on the London-Singapore Concorde route was a tangible expression of confidence in the aircraft. Now that the Malaysian general elections have been held, we look forward to the resumption as soon as possible of discussion between our two Governments of recommencing the services which were interrupted last December.

With the promulgation of the American noise rule and the expected early United States type-certification of Concorde, we shall also look forward to the implementation of the interchange agreements which British Airways and Air France respectively have concluded with Braniff, for a Braniff Concorde service between Washington and Dallas/Fort Worth. A number of problems remain to be sorted out following the demise of the Milford Bill. This would have allowed United States carriers to operate foreign-registered aircraft. Nevertheless, it is significant that Braniff feels sufficient confidence about the outcome of these deliberations to have committed recently a number of its aircrew for early training to learn to operate Concorde. Since this is currently the subject of consideration by the CAA, I cannot, of course, comment on British Airways' application to continue, as a British Airways operation, its present London-Wash- ington service on to Dallas/Fort Worth, except to say that this is complementary to, and does not supplant, the airline's interchange agreement with Braniff.

My hon. Friend also mentioned Pan Am. As has been indicated recently in another place, the Government welcome this expression of interest by the airline, and the manufacturers have been asked to report on the nature and extent of the airline's interest in Concorde and how it might best be met.

I can tell my hon. Friend that discussions with Pan Am continue. Of course, these matters are commercially confidential as between the parties concerned, including British Airways which will be invited to undertake the maintenance of the aircraft. That is a factor to which my hon. Friend alluded. Neither hon. Member, of course, expects me to disclose the details today, because they are confidential. But what is clear is that Pan Am has found that it is losing a significant number of first-class passengers to British Airways and Air France Concorde services. As to Pan Am, Braniff and Singapore Airlines and their financiers, it has to be said that they are not being attracted to Concorde for reasons of national interest or prestige but are being attracted by Concorde for reasons of hard-headed commercial considerations.

Both hon. Members made reference to expenditure. Of course, on 8th May my right hon. Friend the Minister of State for Industry referred to the fact that British expenditures on Concorde development are now estimated at £575 million, and on production to the end of 1978 at £352 million, the latter being offset by receipts of £139 million. But in real terms the net expenditures reached a peak several years, ago and have since fallen away sharply. That must be borne in mind in relation to the remarks which both the hon. Gentleman and my hon. Friend made about the British Airways annual report. It also has to be said that for British Airways, supersonically and subsonically, 1977–78 had its problems. There was a shortage of Concorde crews and there were the suspension of the Singapore service and the subsequent redeployment of air crews. But now that all of these considerations have been gone through, I feel that the airline is now able to seize the opportunities presented by the opening up of the access to New York and by its ability to match Air France's daily frequency.

Although the hon Member for Gloucestershire, South referred to the fact that Concorde flew an average of only 782 hours per aircraft last year, despite all this the airline came within £2 million of achieving a positive cash flow on Concorde. The New York service has already gone up to 10 frequencies a week, and up until mid-July British Airways, despite having to charge fares 20 per cent. above first-class levels, had achieved load factors of 73 per cent. on the New York route and 63 per cent. on the Washington service. The Air France figures were slightly lower but also satisfactory.

I believe that it is figures such as those which represent the context in which we must see Concorde today. It is a future such as that against which we must set some of the remarks in British Airways annual report. Figures such as that bode well for the future, and I am happy today to reaffirm to both hon. Members and their constituents the Government's continued commitment to doing what they can to ensure that Concorde goes from strength to strength in airline service.

I can assure the House that well to the forefront of our collective thinking on this, as on other matters for which the Government have a Concorde responsibility, will be the theme of my hon. Friend's debate, namely, the theme of "the success of Concorde".