Heathow sparked a fresh war of words with the airline industry as it revealed losses have hit £3.4bn since the pandemic began.
Boss John Holland Kaye said that the airport was on the ‘cusp of recovery’ following another summer of severe coronavirus restrictions. He said that passengers would need to return to pre-Covid levels for at least five years.
He stated that the outlook meant regulators should be able to charge passengers and airlines more to encourage rebound and reward backers.
Heathow sparked a fresh war of words with the airline industry as it revealed losses have hit £3.4bn since the pandemic began
Heathrow has been at loggerheads with the Civil Aviation Authority (CAA) and airlines – led by British Airways – over its demands to ramp up the fees it charges to allow planes to take off and land. These fees are usually passed on to customers. Airlines have warned that it is not the right time to increase ticket prices while trying to encourage people to fly again.
The airport, which was Europe’s largest before Covid, wants to charge airlines up to £43 for every passenger handled. This is a hike from £22 in 2020. The CAA has since suggested a compromise of £34.40 and is currently consulting on that figure. Heathrow’s recent demand for higher prices was rebuffed by the industry last night. Airlines UK stated that the regulator “needs to stand his ground”.
A spokesman for the trade body said: ‘Any further increase in charges – not least by the 50pc the CAA are mooting – will hit consumers and make travel more expensive. “How can we have Global Britain if we levy the highest aviation tax and allow the most expensive hub airport in the world to continue raising its fees?” It would make us even less competitive.
Heathrow is currently considered to be the most expensive airport worldwide. According to its latest data, only 10m passengers used Heathrow’s terminals in the first nine months. It processed around 80 million passengers a year prior to the pandemic, and 19m in its first nine months of 2020.
Boss John Holland Kaye claimed that the airport was on the cusp for recovery after coronavirus restrictions caused by another severe summer.
Holland-Kaye stated that although it has been a difficult 18 months, we are beginning to see signs of recovery. We are close to a recovery that will release the excess demand. We need a fair financial settlement from CAA to maintain service and resilience after 15 year of negative real returns for investors.
Heathrow, previously owned by the state, was sold to Ferrovial in Spain in 2006. Its investors now include sovereign wealth funds from China, Singapore, and Qatar.
According to airport sources, shareholders should be rewarded for turning Heathrow into a ‘national embarrassment’ that passengers now consider one of the top airports in the world.
Holland-Kaye stated: “In most years, there have been no returns at all. They’ve had to pay money into the airport in some years. He stated that the airport provides tremendous value for money, and that they are only interested in a fair return.
Heathrow’s harrowing financial results revealed it lost £458m during the usually lucrative summer season between July and September, compared with a £516m loss in the summer of 2020. Losses in the first nine months of 2021 topped £1.5bn, bringing the total loss to £3.4bn since it was forced to cancel virtually all flights in March 2020.