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Heathrow vs other European airports: much more expensive; airlines want terminal monopoly broken up

Virgin Atlantic has backed IAG's call for a breakup of London Heathrow Airport's monopoly on terminal operation. Willie Walsh, CEO of IAG (owner of Heathrow's biggest customer, British Airways), argues that there is a lack of benchmarking, transparency and recourse in the setting of airport charges, which have more than doubled over the past decade.

Mr Walsh has argued that third parties, including airlines, should be allowed to build and operate competing terminals – a view supported by Virgin Atlantic (Heathrow's number two airline). Virgin additionally believes that any expansion of Heathrow needs to ensure a significant increase in airline competition (IAG controls more than half of Heathrow's slots).

Heathrow is currently conducting a public consultation, lasting until late Mar-2018, over its GBP14 billion expansion plans. IAG has given its support to alternative, less costly, expansion plans at Heathrow. The UK government has suggested that airport charges should remain as close as possible to current levels. However, Mr Walsh has proposed that more passengers and internal competition could lead to lower charges.

This CAPA analysis compares Heathrow's average aeronautical revenue per passenger with figures for other IAG airports and other major European hubs. It is considerably more expensive.

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