Heathrow in talks with airlines to end row that could delay third runway | Heathrow airport
Heathrow’s new chairman has begun talks with airlines and billionaire local landowner Surinder Arora to head off a row that threatens to further delay a £49bn plan to build a third runway at Europe’s busiest airport.
Philip Jansen, appointed at the start of the year, is understood to have held meetings with the airport’s carriers and Arora, who backs his own £25bn expansion plan, in the hope of finding middle ground on cost and service issues.
Last week former IT boss and Heathrow chief executive Thomas Woldbye met with International Airlines Group, the parent company of British Airways.
British Airways dominates Heathrow, accounting for more than 50% of slots, and IAG chief executive Luis Gallego has said the cost of the third runway and associated works should be capped at £30bn.
Jansen is also understood to be in talks with Virgin Atlantic and billionaire hotelier Arora, who has for years criticized the airport for “ripping off” passengers, airlines and retailers with high fees.
BA, Virgin and Arora are part of Heathrow Reimagined, a campaign group that aims to massively reduce operating costs at the airport. Airlines and major US carriers refused to support the expansion plan “at any cost”.
Heathrow is considered Europe’s most expensive airport, and in March the UK aviation regulator rejected plans to significantly increase landing fees to fund a multibillion-pound upgrade.
“All airlines and their stakeholders agree on the necessity and long-term economic value of a third runway,” said a source familiar with the talks. “They just have different perspectives. Airlines want the lowest possible cost, other people want to get involved and think it can be done cheaper. No matter what, we all have to work together. If we want to reimagine a path forward, there needs to be good relationships.”
Chancellor Rachel Reeves has thrown the government’s weight behind the expansion, promising work will begin before the next election after decades of debate and opposition over costs and local and environmental impacts.
Ministers in November backed a plan to have the track operational by 2035, ahead of a rival proposal from Arora Group; however Heathrow is still seeking official planning approval for construction to begin by 2029.
Heathrow is owned by a consortium of investors led by French company Ardian and includes sovereign wealth funds from Qatar, Singapore and Saudi Arabia.
China Investment Corporation, which owns 10 percent of Heathrow, is reportedly considering selling its shares due to concerns. Costs increase when the expansion project is implementedAccording to the Financial Times.
A spokesman for Heathrow said: “As the newly appointed Heathrow chairman, Philip Jansen spends time meeting with the airport’s key stakeholders. Building constructive relationships with them, and particularly with our airline and commercial partners, is crucial to achieving our shared goals of excellent customer experience and realizing our vision of being an outstanding airport fit for the future.”
Jansen has developed a reputation for bringing opposing sides together to overcome difficult institutional impasses.
At BT, he engineered the signature £15bn round of funding to roll out full fiber broadband across the UK, after decades of wrangling between stakeholders, vowing to “build like fury” and remove national shame from the UK’s status as a global laggard in internet connectivity.
The beleaguered London-listed WPP was slated for Jansen as chairman early last year, resulting in the immediate sacking of chief executive Mark Read as the advertising firm restructured under former Microsoft boss Cindy Rose.
Separately, Aviation Services UK, which represents ground handling companies including Menzies, Swissport and Dnata, has written to aviation minister Keir Mather, warning that the industry may need a Covid furlough-style scheme for employees if there are widespread flight cancellations due to fuel shortages this summer.
The ground services sector, which manages baggage and check-in services at airports and employs approximately 30,000 people, is charged according to the flight routes of aircraft.
The issue of firing and rehiring staff who require lengthy vetting to work at airports emerged during the Covid pandemic, when shortages caused chaos as airports began to get back on their feet.
