Heathrow Airport in line for new runway

LONDON // Heathrow Airport’s chief executive expects the British government to give the go-ahead for a third runway at the airport before the end of July, potentially ending years of delay and uncertainty for the hub.

John Holland-Kaye’s comments on Tuesday came as Europe’s busiest airport reported revenues climbed 2.7 per cent to £2.76 billion (Dh14.3bn) in 2015, with pre-tax profits of £223 million, up 22 per cent on 2014.

However, despite the good results and soaring demand from passengers and airlines, the airport’s capacity is capped while it has just two runways.

Mr Holland-Kaye is confident that will not remain the case for too long.

“Once the EU referendum [in June on leaving or staying in the bloc], is out of the way, the government will have the headspace to address this and we have every expectation they will back the Airport Commission’s recommendation for a third runway,” he said on Tuesday.

In December last year, the government delayed a decision on expanding the airport, saying that it wanted to do further work on the environmental issues but Mr Holland-Kaye said on Tuesday Heathrow’s proposals had already passed the Airport Commission’s scrutiny and he was confident that it would pass the government’s also.

Heathrow also on Tuesday threw its weight behind the campaign to keep Britain in the European Union. The airport’s value of imports and exports tops that of Britain’s biggest container ports, Felixstowe and Southampton, combined, according to the Seabury trade database. The hub now accounts for 26 per cent of all annual exports.

“Heathrow believes that the UK will be better off remaining in a reformed EU,” said Mr Holland-Kaye. “We are the UK’s only hub airport, connecting Britain to over 80 long-haul destinations, and handling over a quarter of UK exports – but we recognise that for business to thrive we also need to be part of the single European market.

“A vote to remain offers the best of both worlds – it secures our place as a powerhouse in the global economy, while remaining in the world’s largest free trade zone,” he said.

The airport last month reported record passenger numbers for 2015 of 75 million, up 2.2 per cent on the previous year.

In 2014, Dubai International Airport overtook Heathrow as the world’s busiest for international passenger traffic. A total of 68.9 million passengers had passed through Dubai International compared with 67.8 million at Heathrow as of December 22 for that year, data from the Airports Council International showed. The Dubai hub still retains the top slot.

For 2015, Heathrow’s traffic on routes to the Middle East grew by 5.8 per cent as more flights, with larger aircraft, were started to the region. Both Qatar Airways and Etihad have added A380 services from the hub.

Some 469,671 flights operated out of the airport in 2015, up slightly on the previous year, with an average load factor of 76.5 per cent.

This month, Oman Air set a new record for take-off and landing slots at Heathrow, paying £75m for a pair from Air France-KLM. The Indonesian airline Garuda will start services from Heathrow shortly, following Vietnam Airlines and Air China, which have both moved from rival hub Gatwick in the past year.

Heathrow has cut operating costs by 3 per cent and expects to make continued savings in 2016. The airport invested nearly £600m in improving the experience of passengers during the past year, including new stores in Terminal 5 by Chanel, Louis Vuitton and Hermes.

A new baggage facility opens in Terminal 3 in May. The airport’s stakeholders, including Qatar Holding, the investment arm of the country’s sovereign-wealth fund that in 2012 agreed to pay £900m for a 20 per cent stake in BAA, which owns Heathrow, shared dividends worth £380m in 2015, down from £445m in the previous year.

Heathrow celebrates its 70th anniversary in May after opening in 1946 with two runways and tents for terminals.

“When you look at what we have achieved since then, it’s amazing and yet we still have just two runways and that must change,” Mr Holland-Kaye said.


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