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Luton, UK

Town of Luton, Bedfordshire, England

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London Luton International airport (LTN)

London Luton Airport is one of the UK's fastest growing airports with passenger numbers up from 1.9 million in 1995/96 to 6.5 million in the calendar year 2001. Of those passengers, 74 per cent are on scheduled services.

In a pioneering public-private partnership deal signed in August 1998, London Luton Airport remains publicly owned by Luton Borough Council but is operated managed and developed by a private consortium, London Luton Airport Operations Ltd, for a period of 30 years.

A specialist airport management company, TBI plc, became the majority shareholder in London Luton Airport Operations Ltd in March 2001 when they increased their shareholding by buying shares from Barclays Private Equity and Barclays UK Infrastructure Fund. The new structure of London Luton Airport Operations Limited is TBI plc with a 71.4 percent share and Bechtel Enterprises (Luton) UK Ltd. holding a 28.6 percent share.

London Luton Airport was officially opened on 16 July 1938 by the Right Honourable Kingsley Wood, Secretary of State for Air. The airport was owned by the Borough of Luton and, even in those early days, it was considered that Luton ought to be designated the northern terminal for London.

During the war years, the airport was a base for 264 Fighter Squadron. It was also an important manufacturing site at which the Percival Aircraft Company designed and built a series of aircraft for both civil and military use.

Development of the civil use of the airport resumed after the war and in 1952 a new control tower was opened. The 1950's and 1960's saw the birth of affordable holidays which combined the transport and accommodation arrangements into a single 'package'. The 'package holiday' enabled many people to travel abroad for the first time and laid the foundations of the immensely successful inclusive tour holiday market.

London Luton Airport played an important role in the development of the inclusive tour holiday business in the UK. A key event in the growth of charter traffic at Luton took place in 1962 with the formation of a new charter airline called Euravia. At the end of 1964 Euravia changed its name to Britannia Airways. Now, Britannia is one of the world's largest charter airlines and is still based at the airport.

In 1968, another charter operation, Monarch Airlines, was formed. Monarch also developed its business over the years and continues to have its base at Luton.

The growth of the inclusive tour market at London Luton Airport was such that in 1969 a survey revealed that a fifth of all holiday flights from the UK departed from Luton Airport. By 1972 Luton had become Britain's most profitable airport.

Luton suffered a major setback in 1974 when a major tour operator, Clarksons and its airline Court Line, went into liquidation. This sent shockwaves throughout the travel industry but had a major impact on Luton where Court Line was a large airline operator.

A Government White Paper published in 1978 recognised Luton as an integral part of the London airports system. The airport's committee began to prepare to take London Luton Airport into the 1990s and on to five million passengers per annum. As part of the development, a new international terminal building was opened by HRH The Prince of Wales in 1985 which is still in use today.

In 1986 Monarch Airlines started Monarch Crown Service scheduled flights to Spain and Irish airline Ryanair launched scheduled services from Luton to Ireland. This was the start of the growth of scheduled air services from London Luton Airport which have now become over 70 per cent of the business volume.

Another key event in 1986 was the Airports Act that required local authority owners of airports to establish their airports as companies with a Board to manage the business. In 1987 Luton International airport became a Limited Company with Luton Borough Council as sole shareholder. The airport was renamed London Luton Airport in 1990 to reflect its true standing in the London airport network.

By 1990 the scheduled service traffic was growing substantially due largely to Ryanair. It was therefore a major blow to the airport when in 1991 Ryanair moved most of their business to the newly opened terminal at Stansted Airport. This caused another sharp decline in the number of passengers using London Luton Airport and put the business back into loss.

In 1991 following local elections, and after an unsuccessful attempt to sell the airport, a new management team was appointed to stop the losses being made by the airport and reverse the decline in passenger numbers. This changed the role of Luton Borough Council to an arm's length shareholder. The brief to the new management team was to run the airport on a commercial basis and produce benefits to the Borough through the development of new business and growth of employment.

Between 1992 and 1996, £30 million was invested in the airport infrastructure which resulted in a considerable upgrading of facilities.

These upgraded facilities included a new air traffic control tower, new cargo centre, the extension and refurbishment of the passenger terminal, new access road, extension of the car parking adjacent to the passenger terminal and the installation of Category 3 Instrument Landing System.

During this period the core inclusive tour business was boosted by the start of Airtours flights from Luton. Also, two new low fare scheduled carriers, EasyJet and Debonair, commenced operations from the airport. The increase in routes saw passenger numbers rise from 1.9 million in the financial year 1995/6 to 3.4 million passengers in 1997/8.

By 1998/9 the number of passengers had increased to 4.4 million and London Luton Airport was the UK's fastest growing major airport according to Civil Aviation Authority statistics. The passenger mix had also changed considerably. Whereas in 1992, only 23 per cent of passengers were on scheduled services, by 1998 that figure had risen to 68 per cent.

If London Luton Airport was to expand any further, additional financial investment had to be secured. This resulted in the signing of a unique private-public partnership in August 1998 which meant that the airport remains publicly owned by Luton Borough Council but is operated, managed and developed by a new private consortium for a period of 30 years.

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