Heathrow Funding Model Under Scrutiny by Airlines
British Airways (BA) and Virgin Atlantic have joined forces to demand a review of Heathrow Airport's funding model before any investment in a £20 billion third runway.
The airlines argue that Heathrow's fees are already the highest globally and that expansion plans must prioritize a comprehensive reform of the regulatory system. This alliance between Heathrow's two largest carriers underscores the growing opposition to the airport's expansion plans.
BA and Virgin express concerns that they will be unfairly burdened with funding a new runway that primarily benefits rival airlines seeking to increase their presence at Heathrow. They propose establishing a separate mechanism to fund the runway without imposing additional charges on current operators.
According to the airlines, Heathrow's fees exceed those of other major European airports by £1.1 billion, resulting in a deterioration of service standards and a decline in passenger experience. They assert that Heathrow's monopoly power leads to inefficient spending and neglects consumer interests.
The airlines have submitted a joint proposal to the Civil Aviation Authority (CAA), urging a comprehensive review of Heathrow's funding model. They believe this reform can be implemented without delaying construction.
The campaign for a funding model review is supported by the Heathrow Airline Operators' Committee and hotel tycoon Surinder Arora. They cite examples of lower-cost airport expansions in Europe and other regions, such as Istanbul's £10 billion new airport project.
Heathrow Airport acknowledges the need for transparency and expects to collaborate with airlines, the CAA, and the government to establish a funding model that facilitates expansion while ensuring affordability.