Airlines fly into a rage as Heathrow warns charges must climb steeply

 

Britain’s leading long-haul airlines have responded furiously to Heathrow airport’s plan to increase charges by more than three times the rate of inflation.

The owners of Europe’s busiest airport have revealed a £3bn investment plan for 2014-19 – but say that fees must soar to pay for the new facilities.

Charges for Heathrow are set every five years by the Civil Aviation Authority (CAA). They are assessed on a range of estimates including the “regulated asset base” – broadly, the value of the infrastructure – and the predicted number of passengers.

If Heathrow’s figures are accepted by the CAA, the average cost per passenger for the airport from April 2014 will rise to £22. It is currently £19.33. Once Air Passenger Duty of £13 is added, a short-haul economy passenger to Paris, Edinburgh or Aberdeen would pay a minimum of £35 even before stepping aboard a plane.

British Airways, which holds the majority of slots at Heathrow, said that charges have already tripled over the past 11 years and described the airport’s cost base as “inefficient”.

A BA spokesman said: “The charges must be reduced significantly over the coming years, especially when the airport is cutting investment by around 25 per cent from next year onwards. We hope the regulator will give a fair ruling in the months ahead, which doesn’t penalise customers and airlines.”

Virgin Atlantic’s chief operating officer, Steve Griffiths, called on the CAA to set a below-inflation increase after “the incredibly steep price rises” of the last few years: "Other businesses, in private and public sectors and especially airlines, are making savings and delivering on less money. Airports should not be exempt from that.”

The airport’s chief executive, Colin Matthews, said: “This is about keeping Heathrow competitive for passengers and airlines over the next five years, and making sure passengers choose to use Heathrow instead of using Paris or Amsterdam or Frankfurt – or, indeed, Dubai or Istanbul.”

For the first time, Heathrow is using “shocked passenger figures,” to calculate charges. These are conservative estimates that allow for possible downturns caused by events such as volcanic ash or pandemics.

The airport estimates that slightly fewer passengers will use the airport in 2014-15 than they do now. In 2012, 70m travellers passed through Heathrow.

In 2018-19 numbers are expected to rise to a record 72.6m annually, by which time the proposed charge would be £27.30 per passenger.

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