Heathrow Announces Plans to Bump Up Prices

Posted on 17 February, 2013 by Kirsten Kennedy

Aviation officials in the UK have recently spent a significant amount of time debating the future of the country’s airports. At present many do not believe that Heathrow Airport is able to fulfil its role as Britain’s only Hub airport with the current runway and terminal capacities, which in turn has led to proposals for existing airports to be expanded and even for the construction of a brand new state of the art facility near the Isle of Dogs in Central London.

Therefore, bosses at Heathrow have decided that in order to remain a dominant force in UK aviation they must channel investment into the expansion of existing facilities and streamlining of current services in order to run the aorport with maximum efficiency. However, this will mean passing the cost of any improvements on to their passengers – something which officials at Heathrow have already begun to seek approval for.

The proposals were put forward to the Civil Aviation Authority, and if approved will directly affect airlines which operate out of the UK’s largest airport. Heathrow intends to raise the fees carriers are charged to use its facilities over the next five years in order to cover a £3 billion improvement programme which will prepare the Heathrow for the predicted rise in passenger numbers by 2018/19.

Heathrow will use the large investment to improve check in and baggage handling facilities and provide members of staff with further customer service training amongst other things. More immediately, however, will be the opening of the much-anticipated new Terminal 2 building which will hopefully occur next year.

Chief executive of Heathrow Airport, Colin Matthews, believes that annual passenger numbers will leap dramatically from just under 70 million over the next few years. In fact, he states that forecasts indicate around 72.6 million passengers will pass through the terminal buildings by 2018/2019.

He continues; “Heathrow is the UK’s only hub airport and a strategically important national infrastructure asset.

“We have invested billions of pounds in new facilities such as Terminal 5 (T5) in recent years and passengers say they have noticed the difference. Our plan for a further £3 billion of private sector investment will further improve the airport for passengers.

“The plan represents good value for money for airlines and passengers and comes at no cost to taxpayers.”

Unfortunately, while taxpayers may not feel the bite of a private sector investment, passengers choosing to enter or leave the UK via Heathrow most certainly will. Airlines will have no choice but to pass on the charges to their customers, meaning that the already costly method of transport is likely to rise significantly.

At present, passengers flying out of Heathrow pay the equivalent of £19.33 per passenger as part of additional ticket charges in order to cover the airport fees incurred by airlines. However, if the Civil Aviation Authority approves Heathrow’s price increases, this sum could increase to £27.30 in only five years which, along with probable increases in fuel costs and environmental taxes, could price many families out of air travel altogether.

Chief operating officer of Virgin Atlantic, Steve Griffiths, says; “We are totally committed to improving the passenger service at Heathrow, however we believe this can be done without a repeat of the incredibly steep price rises we have seen in airport charges in the last few years.

“Prices at Heathrow are triple the level they were 10 years ago – clearly this is a concern for all passengers travelling through Heathrow, and all airlines operating there.

“In the current economic climate other businesses, in private and public sectors and especially airlines, are making savings and delivering on less money.

“Airports should not be exempt from that and we call upon the Civil Aviation Authority to use its regulatory powers to ensure there is a real-term reduction in charges applied to each passenger.”

Do you think Heathrow should be focusing on making improvements to services or would attempting to bring the cost down for passengers be a better use of any investments made?




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