Airport to expand - but passengers to foot the bill
Published 5 Mar 2013 07:30 0 Comments
HEATHROW has announced plans for a £3bn investment over the next five years.
But the investment comes at the expense of passengers, with airport fares set to rise by 41% over the same period.
The investment - proposed in the airport's business plan for 2014-19 -will include finishing construction of Terminal 2, due to open in 2014, and development of new taxiways to accommodate more modern aircraft.
Colin Matthews, chief executive of Heathrow, said: "Heathrow faces stiff competition from other European hubs and we must continue to improve the service we offer passengers and airlines.
"We have invested billions of pounds in new facilities, such as Terminal 5, in recent years.
"Our plan for a further £3bn of private-sector investment will further improve the airport for passengers."
The business plan must be approved by the Civil Aviation Authority (CAA), which scrutinises the airport's capital expenditure plans, operating costs and commercial revenues every five years to determine the maximum amount it can charge airlines.
CAA will make a final decision on the business plan next January.Heathrow accused CAA of overestimating passenger numbers for the previous five-year period, which resulted in the airport missing out on £650m of revenue - revenue the airport says it cannot recoup.
The new business plan proposes increasing the price per passenger from its current £19.33 figure to £27.30 by 2019, with an average annual increase of 5.9% above inflation. Both British Airways and Virgin Atlantic have criticised the proposed price hike.
Heathrow proposes to spend more than £650m in capital expenditure between 2014/15 and 2015/16.
before reducing its expenditure in the following years.
The airport expects to deal with more than 70m passengers annually in 2015/16 and anticipates dealing with 72.6m passengers by 2019.
Heathrow has invested £11bn into the airport since 2003, one of the largest private-sector investments in UK infrastructure.
This article appeared in Bracknell News 27 Feb 13