Heathrow loses top spot as Europe's busiest airport while 200 hubs face going bust

Heathrow boss blames the UK government for not bringing in airport testing to kickstart travel

Passengers  at Heathrow Terminal 5 Airport in London. In September, the government said tax-free shopping would end for all visitors to the UK after the end of the Brexit transition period on DecemberShow more

Heathrow has been overtaken as Europe’s busiest airport for the first time by Paris Charles de Gaulle amid falling air travel demand during Covid-19, as almost 200 airports in the continent face going bust by the end of the year.

The UK airport said its passenger numbers were 84 per cent down in the three months to September as a result of Covid-19, and it expects just 22.6 million passengers this year – a quarter of its 2019 levels – and 37.1 million in 2021.

Heathrow's falling numbers come as 193 airports in the UK and Europe face going bust in the coming months if passenger traffic does not start recovering by the end of this year, according to ACI Europe.

Heathrow chief executive John Holland-Kaye blamed the UK government for not bringing in an airport testing regime to help kickstart travel, in turn allowing Charles de Gaulle and other rivals such as Amsterdam Schiphol to reopen faster.

"Britain is falling behind because we've been too slow to embrace passenger testing. European leaders acted quicker and now their economies are reaping the benefits," he said on Wednesday.

"Bringing in pre-departure Covid tests and partnering with our US allies to open a pilot air bridge to America will kickstart our economic recovery and put the UK back ahead of our European rivals."

Airlines must cut more jobs to reduce costs as travel demand remains muted in the wake of Covid-19, the International Air Transport Association said on Tuesday. Most airlines across the globe furloughed workers or slashed jobs when revenue stopped following the grounding of flights at the start of the pandemic. Although international travel has resumed in most countries, demand remains weak due to quarantine measures and fears of infection.

ACI Europe said an estimated 193 European hubs, which provide 277,000 jobs and generate €12.4 billion ($14.58bn) in collective annual revenue, are considered “at-risk airports,” with the threat of mass closures posing a significant threat to Europe’s air transport system.

Olivier Jankovec, the director general of ACI Europe, said the figures “paint a dramatically bleak picture” for the future of the aviation industry, which has already suffered tens of thousands of job losses.

“Eight months into the crisis, all of Europe’s airports are burning through cash to remain open, with revenues far from covering the costs of operations, let alone capital costs,” Mr Jankovec said. “Governments’ current imposition of quarantines rather than testing is bringing Europe’s airports closer to the brink with every day that passes.

“In the midst of a second wave, ensuring safe air travel continues to be our primary concern. It’s crucial that we reduce the risks of importation and dissemination as much as possible. But surely we can do a much better job of reducing those risks by testing air passengers rather than with quarantines that cannot be enforced.”

The airports body, which represents over 500 airports out of a total of 740 airports in Europe with paying passengers, said passenger traffic at European airports decreased 73 per cent year-on-year in September, with 172.5 million passengers lost. The total volume of lost passengers since January 2020 is now 1.29 billion.

Larger European airports are also burning through cash at an unsustainable rate and “are not immune from the critical financial risk,” ACI Europe said.

“They have cut costs to the bone and have resorted to the financial markets to shore up balance sheets and build up emergency war chests,” it added.

The top 20 European airports have added €16bn of debt – equivalent to nearly 60 per cent of their revenues in a normal year, ACI said.

“This, along with the fact that these airports had to make thousands of highly skilled workers redundant, clearly jeopardises their future,” the organisation said.

Saj Ahmad, chief analyst at Strategic Aero Research, said many airports could end up shutting up shop or collapsing altogether given the dearth of travellers.

"The quarantine regimes that differ across Europe has meant that those who have incomes are reluctant to spend money when it means being locked away for up to 14 days on arrival. Without that money being spent and passed on, airlines are not flying full schedules and regional airports are sat almost empty with zero income," Mr Ahmad told The National.

However, he said the UK is likely to have fewer "at risk" airports because of its smaller geographical footprint.

"The fringe players are still surviving thanks to business-jet travel for those that can afford it. But that’s not to say that several could fold – the UK Government's push for airport testing that starts in weeks could help avoid that scenario," Mr Ahmad said.

Britain has said it will bring in airport testing by the beginning of December, offering a much-needed boost to Heathrow, which said its losses widened to £1.5bn ($1.96bn) in the first nine months of the year, with third-quarter revenue falling 72 per cent to £239 million.

"We acted quickly to reduce our monthly 'cash burn' by over 30 per cent, cutting at least £300m of operating costs and cancelling or pausing over £650m of capital projects," the airport said.

Mr Ahmad said it was no surprise that Heathrow had lost its number one position in Europe.

“Prior to the pandemic, it was already running at near 99.5 per cent capacity. The collapse in travel demand across the globe and the slow introduction of Covid testing measures means that other airports in Europe will have fared better because they were clearly more agile and prepared,” he said.

“The pandemic almost certainly means that the business case for a new runway and terminal are in complete tatters. I don’t see it being revived this side of 2040."