Plans for a significant increase in landing charges at Heathrow Airport have sparked outrage from its largest airline stakeholders, British Airways and Virgin Atlantic.
The UK’s premier airport announced on Friday its plans to raise the fee it charges airlines for using its runways by 17 per cent, a move that is likely to result in higher ticket prices, as reported by City AM.
Over the next five years, average landing charges are projected to rise to approximately £33.26 per passenger, up from £28.46.
This comes as part of broader plans for £10bn in private investment over the next half decade, as the West London airport aims to accommodate an additional 10m passengers by 2031.
Heathrow has submitted its proposals to the Civil Aviation Authority (CAA) which would increase annual passenger capacity to 92m while expanding existing terminal space for new shops, lounges and restaurants.
Virgin Atlantic expressed its agreement with Heathrow’s need to enhance customer experience but criticised the proposed investment plan. “However, only Heathrow with its monopoly power as the UK’s only hub airport would think that this £10bn investment plan represents value for money and that’s before any third runway expansion costs are factored into the equation.
“Heathrow says that its shareholders will contribute £2bn equity but it is ultimately consumers and airlines that pay the bill,” added a spokesperson for the airline, which is part of a consortium advocating for a regulatory overhaul at the airport.
“Heathrow is already the most expensive airport in the world and this proposal demonstrates Heathrow’s inability to invest capital wisely and efficiently. Therefore, we continue to call on the CAA to undertake an urgent fundamental review of Heathrow’s economic regulatory model, which is simply not fit for purpose.”
IAG, the airline group that owns British Airways, Aer Lingus and Vueling, has also acknowledged Heathrow’s “intent to improve passenger experience,” but insisted its plans require “significant revision.”
We must invest, says Heathrow boss
Both Virgin and IAG argue that Heathrow’s proposed increase in landing charges would be significantly higher than the airport suggests, ranging between 25 to 27 per cent.
“The suggested £10bn investment would be paid for by passengers and airlines, raising serious concerns about affordability and value for money,” a spokesperson for IAG commented.
Heathrow is currently progressing with long-delayed plans for a third runway, a project that received support from Chancellor Rachel Reeves earlier this year.
Leaked documents viewed by City AM disclose the airport’s plan to overhaul car parking for the expansion would cost more than the entire expansion of its nearest competitor Gatwick, which is campaigning for a £2.2bn second runway. These costs would likely contribute to any rise in passenger air fares.
Heathrow’s chief, Thomas Woldbye, has remarked on the airport’s advancements, saying: “We’re making good progress on our strategy to become an extraordinary airport – having become Europe’s most punctual major airport so far this year. But our customers want us to improve our international rankings further, as do we.”
He further outlined the airport’s ambitions for global competitiveness, stating: “To compete with global hubs, we must invest. Our five-year plan boosts operational resilience, delivers the better service passengers expect and unlocks the growth capacity airlines want with stretching efficiency targets and a like-for-like lower airport charge than a decade ago.”
