British Airways would consider shifting investment to rival airports if Heathrow becomes uncompetitive due to landing fees or the cost of building a new runway, the airline’s chief executive has warned.
Sean Doyle said parent company IAG could prioritise investment in its airlines overseas, including Spain’s Iberia and Ireland’s Aer Lingus.
The UK government is considering two proposals to expand Heathrow with a third runway.
The airport’s owners want to build a full-length 3,500-metre runway, which would involve diverting the M25, while Arora Group is seeking permission for a 2,800-metre runway, negating the need to move the motorway.
Heathrow is also seeking to raise the landing fees it charges airlines by 17 per cent – from £28.46 to £33.26 per passenger – as part of its £10 billion investment plans. When the request was made to the Civil Aviation Authority in July, IAG called it “excessive”.
Speaking at the Airlines 2025 conference in Westminster, Mr Doyle said the group allocates capital “on the basis of performance” and that if Heathrow becomes uncompetitive, affecting BA's performance, “there’ll be opportunities to put that capital elsewhere”.
He said Madrid airport was “flying” with Iberia reporting very strong results, while BA has a strong presence in the expanding market of Barcelona. “Dublin has built a new runway for a couple of billion, so there’s headroom there,” he added.
He said: “There will be debates about competitiveness and airport charges when it comes to the way IAG allocates capital. We’re not at that point yet but that’s why, for everybody’s sake, a competitive Heathrow is very important.”
In May, British Airways highlighted its investment at the London airport, saying the use of AI had allowed it to increase punctuality so that more than 90 per cent of its flights were leaving on time.
The airline said it had invested £100 million ($133 million) in improving operational resilience, which funded the development of a range of digital tools and apps.
Motorway move
Mr Doyle also suggested that Heathrow should be expanded without moving the M25 motorway if possible.
“If you can avoid moving the M25, you should avoid moving the M25,” he said. “I can’t argue against the logic of that. I think we should look at ways of potentially building a shorter runway.”
However, at the same event, Heathrow’s chief executive Thomas Woldbye insisted that moving the M25 was “not avoidable” to build a third runway that provides the necessary boost to capacity.
He said a shorter runway would cost “almost the same” but deliver “much less capacity”.
Mr Woldbye added: “It just does not make sense.”
Surinder Arora, the founder of the Arora Group, told The National in September that he believed attempting to build a runway over the M25 would be a “complete disaster” as it would go on for years at immense cost.
The proposal from Heathrow’s owners would require a new M25 tunnel and bridges to be built 130 metres west of the existing motorway.
The applicants behind both expansion proposals have been asked by the government to provide more information about the impact for investors, affected communities and businesses.
By the end of November, Transport Secretary Heidi Alexander will announce the scheme being taken forward to inform the remainder of her review of the Airports National Policy Statement, which will provide the framework for decisions on airport growth.
