Thursday , February 22 2018
Home | Regulatory Affairs | Heathrow Airport has “abysmal” record of regulating building costs

Heathrow Airport has “abysmal” record of regulating building costs

International Airlines Group CEO, Willie Walsh, has said that Heathrow Airport has an “abysmal” record of controlling building costs and proposed that other firms should be allowed to design and construct new terminals at the said airport.

However, Heathrow pointed out that such an arrangement was not at all needed.

The government is set to release final proposals for a third runway at Heathrow in the coming months. Then, MPs would be voting on these plans.

Walsh though, is calling for an end to the “monopoly” of Heathrow’s terminals.

“Heathrow Airport Limited run an airport – they’re not the best at designing or building the facilities,” Walsh asserted.

“We believe that should be left to others who are much better, and who would have a greater focus on cost control.”

Heathrow’s Chief Executive John Holland-Kaye, however, claimed that the statement is “a blatant attempt by Mr Walsh to maintain a dominant monopoly for BA at Heathrow and to frustrate the increased airline competition that should result from expansion.”

Walsh countered that he does not think that the present terminals should be sold off. Rather, he is hoping that competitors should be given the chance to forward proposals for developing, designing and building new terminal facilities.

“It’s not rocket science, there are plenty of people who have been involved in this type of construction in other areas who would be interested,” Walsh said.

“We know because we’ve been approached by many of them, who believe that they could do this in a much more efficient way than Heathrow,” he added.

Walsh’s latest comments are the most recent barrage in his enduring war of words with Heathrow, which is owned by Spanish firm Ferrovial.

IAG, which possesses Iberia, Aer Lingus, and BA, has control of half the landing slots at Heathrow, long considered to be Europe’s most hectic airport.

Walsh has long been a prominent critic of the fees that were being charged on airlines by Heathrow that stands at around £22 per passenger.

IAG stated the recommended expansion of the airport could make way for independent firms to construct and oversee commercial facilities at the airport, which includes terminals.

“Heathrow’s had it too good for too long and the government must confirm the Civil Aviation Authority’s powers to introduce this type of competition,” Walsh said.

A spokesperson said Heathrow wanted to guarantee competition and choice between airlines at the airport:

“Expansion will open up opportunities for IAG, easyJet, flybe, Virgin and dozens of international airlines with whom we are working closely to deliver expansion at close to current charges.”

The third runway was due to cost almost £17bn, but Heathrow argued that it could finish the project for £14bn. Airlines are concerned that the airport would increase landing charges to help pay for the third runway.

IAG has warned that they would call for a price cap on landing charges if they do not drop after the new runway is completed.

About Aeropolitical Updates Editor

mm
Working in the aviation industry? Stay up to date with the fast-changing aviation regulations, conventions and agreements around the world.

Check Also

KPMG Partner Examines Challenges Around Amending EU Aviation Legislation

By aviationbusinessme.com European carriers have been waiting with bated breath for the amended aviation legislation which …