Heathrow refutes fears of rocketing airline charges

Heathrow refutes fears of rocketing airline charges

The boss of Heathrow has sought to counter airline fears that charges will sky rocket should the government approve a third runway.

Chief executive John Holland-Kaye moved to reassure airlines about the impact on their costs of the potential £16.5 billion investment.

Alex Cruz, chief executive of Heathrow’s biggest customer British Airways, last week warned that the airline and parent group IAG could switch operations to alternative hub airports if charges rise.

But Holland-Kaye said per-passenger charges would hold steady. He told the Financial Times: “Through the planning and build period, we can keep prices flat on average compared to today.

“What that means is that there will be some years where they are going down, some where they are going up. That is a very good position to be in.”

However, IAG said the average was calculated over a period stretching to 2048 and masked a sharp price rise in earlier years.

“Their figures cannot deliver their stated aim of making Heathrow and the UK competitive,” the company said.

The government plans next week to announce whether it supports an extra runway at Heathrow or at Gatwick – with the west London hub tipped as the favoured choice. 

IAG complained that dividends paid to Heathrow’s shareholders for the first nine months were 68% up on the same period last year, at £486 million.

However, Heathrow insisted that figure was deceptive and its ultimate shareholders had received only £225 million, the same as last year.

Holland-Kaye said the shareholders had already invested “significantly” in Heathrow as a sign of their confidence in the airport and the UK as a whole.

“Expansion should not be at any cost, so we’re completely aligned with our customers,” he said.

Heathrow has reportedly been seeking to find ways to bring down the cost of a third runway. Measures it is considering include a change to how the new runway would cross London’s M25 orbital motorway and scrapping of an elaborate rail system to carry passengers around a new terminal.

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