BAA's new man flies in early to take the controls at Terminal 5

By Margareta Pagano

BAA's new chief executive, Colin Matthews, flew into a storm at Heathrow's Terminal 5 last week when he started his job early to cope with the airport hub's meltdown.

Mr Matthews was due to start this Tuesday, but went to the T5 opening at 4am last Thursday morning and stayed for two days to handle the chaos caused by the failure of the baggage-handling system. A spokesman for BAA said at the weekend: "He has been working flat out, helping us sort out the problems. He's firmly on board."

The new chief was hired by BAA's chairman, Sir Nigel Rudd, two months ago to replace Stephen Nelson. Sir Nigel brought in Mr Matthews to help restore BAA's appalling reputation, and to sort out issues from security to delays. But Spanish-owned BAA was under more pressure after the catastrophic opening of the £4.3bn T5, which handles about 40,000 passengers a day. Hundreds of flights were cancelled because of the luggage-handling breakdown, with BAA and BA blaming each other. But BAA said it was now working with BA to get the 18km of belts, handling 12,000 bags an hour, moving again.

Airlines took the opportunity to bash BAA. Nigel Turner, the chief executive of BMI, said T5's chaos underlined the need for BAA's monopoly over Britain's airports to be broken up.

"What is happening at T5 is disappointing for UK plc," said Mr Turner. "I don't like to enjoy disaster but maybe what is occurring will give more courage to those who say BAA must be broken up. BAA is an institutionalised monopoly that has been abusing its position. I've been saying this for 10 years – it's time it was stopped."

Mr Turner, whose airline operates 12 per cent of all Heathrow's landing slots, and who met Mr Matthews on Friday to discuss the crisis, said: "TV pictures of T5 in meltdown are being beamed across the world, making us a laughing stock. This is so frustrating for us, but also for Heathrow, because the rest of the airport is running 100 per cent."

BAA, bought by Ferrovial last year, operates Heathrow, Gatwick and Stansted airports, and has staked its reputation on T5.

BMI, Ryanair and easyJet have stepped up their lobbying campaign to persuade Ruth Kelly, the Transport Secretary, to change the way UK airports are run, writing to her with their concerns at the Civil Aviation Authority's decision to push through BAA's latest price increases on landing charges.

Mr Turner added: "In other countries the airlines and the airport authorities work together. Here, BAA has decided to take on the airlines. It's a big issue for any politician to take on. BAA is playing for big stakes."

BMI and its rivals are still making their submissions to the Competition Commission, which is due to issue its "emerging thinking" report on the future of BAA by the end of April, and the final report, and its recommendations, by the end of the year. The Government has the power to overturn any recommendation by the commission.

Analysts say that Ferrovial, which has about £10bn of debt following the BAA takeover, could make about £5bn if it were forced to sell Gatwick. Ferrovial's shares slipped 5 per cent on the week to €46.37, while shares in BA closed down at 240p.

Meanwhile, commentators say the problems at T5 could continue this week – which will be even busier than usual because of school holidays.