BA boss insists third runway needed ‘quickly and cheaply’

The heads of British Airways and Heathrow clashed over the cost of building a third runway, with the airline’s chief executive Sean Doyle arguing Heathrow should settle for a shorter runway to avoid having to move the M25.

 

Heathrow chief executive Thomas Woldbye hit back, insisting a shorter runway “would not be enough”.

 

Speaking at the Airlines 2025 conference in London on Monday, Doyle said: “We support expansion at Heathrow. The airport is full and we compete globally."

 

But he said: “We need to build this runway as quickly and cheaply as we can. We need to look at regulatory reform [and] if we can avoid moving the M25 we should. If that means building a shorter runway we should.”

 

The government is considering two proposals for Heathrow expansion having signalled its support for a third runway and is due to decide on which to proceed with by the end of this month.

 

Heathrow has proposed constructing a 3,500-metre runway, capable of handling the largest passenger aircraft, at an estimated cost of £48 billion. This involves the diversion of the M25 and construction of a tunnel.

 

A rival proposal for a shorter, 3,000-metre runway presented by construction and hospitality group Aurora would be cheaper and has attracted support from UK airlines wishing to avoid the costs of construction adding substantially to Heathrow’s charges.

 

Doyle noted BA’s parent group IAG “allocates capital on the basis of performance” and said: “If Heathrow becomes more expensive and it affect’s BA’s performance the group will allocate capital differently.”

 

Woldbye said he agreed with Doyle “that if we could avoid moving the M25 we should.” However, he argued: “We need a longer runway. Sean needs it. The shorter runway would not be enough. It would cost about the same, but we would end up with less capacity.”

 

He claimed: “The other proposal will close Junction 14 [of the M25]. What we’re proposing is not going to disrupt [traffic].

 

“Our proposal has much less impact on the local community. We would need to demolish 750 homes. The other proposal would demolish 2,000 and have nowhere for a building site. I believe it could be more expensive.”

 

Woldbye insisted: “The discussions we’ve had with airlines make clear a 3,000-metre runway would not be enough.”

 

He said: “If we’re going to have a third runway, we need clear government support. If we don’t do it, we’ll put brakes on the country’s economic growth. We should talk more about that than the cost.”

 

Woldbye told the conference: “We’re never going to be the cheapest airport in the world. We’re a big airport in the heart of London. Building costs in London are twice as high as in Madrid.

 

“We have a high level of service at the gate and that is a higher cost. That is what our airlines ask for. They spend more time talking to us about our service than about our price.

 

He asked: “If we are not value for money, why do so many airlines want to get into Heathrow?”

 

Meanwhile, Heathrow hailed a “bumper” autumn half-term for helping lift October passenger numbers by 2.1% to a record 7.3 million, helped by a surge in travel to European cities including Brussels, Lyon, Marseille and Vienna.

 

The London hub called for action in the forthcoming Budget to address the Valuation Office Agency’s "punitive" revaluation in business rates for airports. 

 

A statement said: “Heathrow faces an eye-watering multiple-fold increase. Left unchecked, these would drive unacceptable costs for airlines and could deter private investors who are ready to help UK aviation to grow and improve services, with billions in UK supply chain spend at stake.”