Air industry chiefs turn on Cameron after Heathrow attack

British Airways and BAA put their often prickly relations to one side yesterday to launch a scathing attack on David Cameron and business leaders who have called for the scrapping of plans to build a third runway at Heathrow.

In separate statements, the companies dismissed as "thoroughly dangerous" and "insulting" recent comments from the Tory leader suggesting that Heathrow would do better to invest in the airport's infrastructure so that it runs more efficiently.

The broadsides marked an escalation in an increasingly acrimonious debate about how best to address the limitations at Heathrow, which is already operating at 99 per cent capacity and, say detractors, threatening the economic vitality of the UK as an internal centre of commerce.

London First, a business lobby group, published a report yesterday calling for a 1 per cent reduction in flights at the airport – equal to about 4,800 per year – to improve the airport's infamous record on delays and punctuality. Baroness Valentine, head of London First, said such measures were necessary because Heathrow, "once an asset in attracting business to the capital, is at risk of becoming a liability".

The most pointed comments, however, came from Willie Walsh, chief executive of British Airways, and Colin Matthews, head of the airport operator, BAA, in response to recent public statements by Mr Cameron.

In a speech on the environment this week, the Conservative leader said: "The whole country can agree that the most important priorityfor Heathrow is making it better,not bigger."

Mr Cameron also rejected the concept at the heart of the third runway plan, which envisions Heathrow bolstering its role as an international hub that will attract greater amounts of traffic, jobs, investment and taxes. "The economic value of transfer passengers is hotly disputed. And there are so many examples of the hub model going wrong," he said.

Mr Matthews objected strongly to that view. "Some say transfers contribute nothing, either toHeathrow, or to London, or to the UK economy," he said in his first speech since taking charge at the airport group three months ago. "That is not just wrong. It is thoroughly dangerous. Getting rid of transfer passengers would be a fundamental, strategic error reducing Heathrow, in effect, to a regional airport on the margins of Europe – at a time when this country's direct connections to the rest of the world could not be more important."

Mr Walsh, meanwhile, said that retaining Heathrow's role asthe world's primary international hub was paramount, and that any argument to the contrary "does not bear examination".

He added: "The critical financial strength of transfer passengers means that Heathrow can offer a far bigger network of direct, long-haul services for people who want a non-stop journey from London than would otherwise be the case. That is how hub airports work. That is why they are able to provide the world-class range of destinations that is essential for business capitals that want to succeed in a global economy."

In a separate development, Moody's, the credit rating agency, downgraded its outlook for BA from "stable" to "negative" on concerns that a sustained high fuel price and the limited ability of the carrier to recoup the cost through fare increases will hurt its financial position.

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