Airlines have expressed strong displeasure regarding Heathrow Airport’s proposal to increase passenger fees as part of its investment strategy, aimed at accommodating an additional 10 million passengers annually by 2031.
Heathrow plans to set the average passenger charge at £33.26 for the period from 2027 to 2031, in comparison to what it asserts is an average of £28.46 for 2022-2026, a figure that airlines dispute.
A representative from Virgin Atlantic stated, “Heathrow is already the priciest airport in the world, and this proposal highlights its failure to invest capital judiciously and efficiently.”
Heathrow’s CEO, Thomas Woldbye, commented, “Our customers expect us to enhance our international standing, and we share that ambition.”
He emphasized the necessity of investment to compete with other global hubs.
As the busiest airport in Europe, Heathrow is anticipated to serve over 83.9 million passengers in 2024, having just recorded its highest traffic in May.
On Friday, Heathrow Airport Limited (HAL) submitted its £10 billion business plan for 2027-2031 to the Civil Aviation Authority (CAA), which regulates the maximum per-passenger landing fees airlines are required to pay.
These charges are typically passed on to passengers via ticket prices.
The proposed project aims to create additional space in existing terminals equivalent to ten football fields, which would allow for the establishment of new lounges, restaurants, and retail outlets.
Furthermore, it promises enhanced speed in security and baggage processing, according to airport officials.
Plans include demolishing the former Terminal 1 building, expanding Terminal 2, and constructing a new tunnel for southern access.
Once completed, these upgrades would enable a 12% increase in passenger capacity, translating to an additional 10 million travelers each year.
A Virgin Atlantic spokesperson remarked, “We fully concur that Heathrow must significantly enhance the customer experience to meet the standards expected by UK consumers.”
“Nonetheless, only Heathrow, with its monopoly as the UK’s sole hub airport, could perceive this £10 billion investment plan as offering value for money, especially before considering the costs of any potential third runway expansion.”
“Heathrow claims its shareholders will provide £2 billion in equity, but ultimately, consumers and airlines bear the financial burden, particularly in light of Heathrow’s proposed 28% increase in passenger fees by 2027 compared to current rates.”
“Heathrow has already established itself as the most expensive airport globally, and this proposal further exemplifies its inability to invest funds wisely and efficiently.”
“We therefore urge the CAA to conduct an immediate and thorough review of Heathrow’s economic regulatory framework, which is not functioning as it should.”
IAG, which encompasses British Airways, Iberia, Vueling, and Aer Lingus, stated that HAL’s plan “needs substantial revision.”
A spokesperson noted, “The suggested 25% hike in charges is excessive, especially since Heathrow is already the costliest airport worldwide, and this initiative does not expand capacity.”
“The proposed £10 billion investment will ultimately be funded by passengers and airlines, raising significant concerns regarding affordability and overall value.”
Heathrow chief executive Thomas Woldbye responded by asserting, “We are making significant strides in our goal to become an exceptional airport, having achieved the title of Europe’s most punctual major airport so far this year.”
