Hotels and airlines are demanding that Heathrow Airport introduces lower fees and better standards as the UK’s busy airport is ‘not fit for purpose’ having ‘failed to modernise’ and ‘let down consumers, carriers and the British economy’
Key customers of Heathrow Airport, including airlines and hotels, are demanding lower charges and higher standards.
Virgin Atlantic, British Airways parent IAG, the Heathrow Airline Operators’ Committee (AOC), and the Arora hotel group have all joined forces against the UK’s busiest airport’s regulatory regime as, “instead of being a source of national pride, Heathrow has failed to modernise and in turn, let down consumers, carriers and the British economy”.
Together, they hope to persuade the Civil Aviation Authority (CAA) “to conduct an urgent and fundamental review into the way in which Heathrow, the UK’s only hub airport and the largest in Europe, is regulated, for the benefit of consumers, businesses and the UK economy”.
The campaign, which has been named Heathrow Reimagined, aims to battle current arrangements at the airport, which contributing companies have said are not fit for purpose.
In a statement, the partners said: “Heathrow Airport Limited’s substantial market power has, for too long, given it an incentive to spend inefficiently which means it has acted against the interest of both consumers and airlines. In the 15 years since the last major review into UK aviation by the Competition Commission, Heathrow has become the world’s most expensive airport, with passengers and airlines today paying £1.1billion more each year than if charges were in line with equivalent major European airports.”
The campaign also notes how in recent years, the airport has dropped out of Skytrax’s Top 20 airports for passenger experience and that many surveys have found the airport to be “the most stressful in Europe”.
Heathrow Reimagined wants to see an investigation before “passengers and airlines are locked into higher charges for decades to come”.
Nigel Wicking, chief executive of Heathrow AOC, said: “Heathrow is rapidly falling behind other major airports around the globe both in facilities and service to airline customers, whilst having the unenviable accolade of being the most expensive for airport charges. This cannot continue. The airline community want to offer travellers, to and from the UK, a great experience through Heathrow and we want growth, also avoiding the disproportionate costs we too often see by Heathrow Airport Limited.”
Shai Weiss, CEO of Virgin Atlantic, said: “The current regulatory model at London Heathrow is simply not fit for purpose and does not sufficiently constrain Heathrow’s monopoly power. Despite having the highest passenger charges in the world, Heathrow is failing consumers, airlines and the UK economy, with ageing facilities and a declining customer experience. The regulatory framework which governs Heathrow must be reformed and we call on the CAA to undertake a fundamental review.”
Heathrow Reimagined also highlighted alternative international hubs that have realised an opportunity to grow in more efficient ways than Heathrow, providing better value for money. Examples included new terminals at Barcelona, Frankfurt, Munich and Madrid airports, which all cost half or less, when adjusting for terminal size, than the upgrades to Heathrow Terminals 2 and 5.
The report also mentioned how Istanbul is developing a completely new airport with capacity for up to 200 million passengers for €12 billion (£10.5billion) and New York JFK is opening its New Terminal One in 2030, which is the centrepiece of a £15billion airport wide transformation.
The campaign hopes to now engage with the wider industry and the Government to achieve reform that will help deliver better value to customers, businesses and the UK Government’s growth agenda.
Recently, the Government backed planes for a third runway at Heathrow Airport, which is expected to cost around £14.4 billion. The project, once completed, is also anticipated to grow passenger numbers from 84 million to 129 million.
When Rachel Reeves recently backed the third runway plan, Heathrow Airport stated: “Heathrow is the UK’s gateway to growth and prosperity. A third runway and the infrastructure that comes with it would unlock billions of pounds of private money to stimulate the UK supply chain during construction.
“Once built, it would create jobs and drive trade, tourism and inward investment to every part of the country. It would also give airlines and passengers the competitive, resilient hub airport they expect while putting the UK back on the map at the heart of the global economy.”