Friday 21 October 2016

Walsh says airlines will not pay for runway at Heathrow

Paul O'Donoghue

Published 02/07/2015 | 02:30

Airline boss, Willie Walsh
Airline boss, Willie Walsh

Willie Walsh, the airline boss who is currently working on a takeover of Aer Lingus, has vowed that IAG will not pay towards the construction of a new runway at Heathrow Airport.

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His comments came after the announcement yesterday that Heathrow has won the backing of a UK government-appointed panel for a third runway.

After a three-year study, the Airports Commission selected a new runway at Heathrow over two other shortlisted options, arguing this offered Britain the best way of adding long-haul routes to new markets which it said were "urgently required".

The landmark decision by the Commission is a blow to rival contender Gatwick Airport which lobbied hard to be allowed to expand.

Building a new runway at Heathrow, Europe's busiest hub, would cost more than around £17.6bn (€25bn) with billions more in transport costs.

The Commission's chairman Howard Davies said: "Heathrow ... provides the greatest benefits for business passengers, freight operators and the broader economy."

The new runway would facilitate an extra 260,000 flights a year when running at full capacity. Currently flights at Heathrow are capped at 480,000 a year. Heathrow handled more than 73 million passengers last year.

The proposal was welcomed by IAG chief executive Willie Walsh, inset, who said that the Commission "has recognised Britain's urgent need for an effective international hub airport".

IAG currently holds about half of Heathrow's 688 slots. it is currently in the middle of a €1.4bn bid for Aer Lingus, which holds 24 Heathrow slots.

Despite favouring the idea of a third runway, Mr Walsh made it clear that he is strongly against airlines footing the bill for construction and warned that the project could end up shelved without decisive political action.

He said: "Despite diligent work by Sir Howard Davies, and the compromises he has made in an effort to appease some politicians, the real test is whether any political will exists to turn his recommendation into reality. Without political vision and leadership, it will end up on the shelf gathering dust like its predecessors."

He added: "Even with political consensus, Sir Howard believes naively that the costs associated with the scheme would be borne by airlines.

"While we believe it would be outrageous to burden passengers with the cost of such expensive infrastructure, we will not pay for it."

However, the proposal already faces mounting opposition, including resistance from the UK's Conservative government.

It is now up to the UK government to decide whether to accept the Commission's recommendation, but Mr Cameron told voters in 2009, before he came to power, that a third runway at Heathrow would not happen under his watch, "no ifs, no buts".

David Cameron has denied reports that he has already made up his mind about the third runway and has promised a decision on the expansion by the end of the year.

Dublin-based carrier Ryanair has also said that it does not think that the Heathrow expansion would be enough to solve what it claims is a "capacity crisis" in the south east of England.

Chief marketing officer Kenny Jacobs said: "Ryanair strongly advocates taking politicians out of runway decision making and allowing each of the three London airports, Heathrow, Gatwick and Stansted, to build three competing runways which will solve the capacity crisis in the south east for the next 100 years, while at the same time allowing competition between the airports to deliver this capacity efficiently."

Heathrow has estimated that building could start in 2020 and the new runway would be ready in 2025, but that could be held up by the government's decision and tough planning laws.

The Commission said a new runway would generate up to £147bn in economic output over 60 years and create more than 70,000 jobs by 2050.

Residents of Harmondsworth, a village to the north west of the airport, have vowed to fight the recommendation.

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