British Airways owner IAG has hit out at the “spiralling” cost of Heathrow airport’s proposed £14 billion expansion plan.
Heathrow was granted outline permission last year to pursue expansion by around third via a new north-west runway, the airport’s third.
However, in a submission to the CAA on Wednesday (21 August), IAG chief executive Willie Walsh accused Heathrow of covering up the true cost of its expansion plans, which he says now run to £32 billion.
Walsh said Heathrow’s proposal would see passengers stump up £3.3 billion in “advanced costs” for the third runway, which is still conditional on Heathrow achieving planning consent.
“Heathrow’s on a massive gravy train and will do everything to protect that,” said Walsh. “We have absolutely no confidence in its ability to deliver cost-effective expansion.”
Walsh said Heathrow’s initial construction and planning costs, originally forecast to run to £915 million, had grown more than 250% to £3.3 billion since the plans were tabled.
He also alleged that while Heathrow’s original £14 billion estimate included the runway, an additional terminal and additional aircraft stand capacity, its latest masterplan cited this estimate for the cost of the runway alone.
“Advance costs are spiralling out of control and total expansion costs are being covered up,” said Walsh. “This latest development proves beyond doubt that Heathrow can’t be trusted.
“Spending £3.3 billion before receiving planning permission is irresponsible and it’s completely unacceptable to expect passengers to pick up the tab.”
Responding to IAG’s submission and Walsh’s comments, a Heathrow spokesperson said: “The costs for developing Heathrow out to 2050 are exactly the same as what we submitted to the Airports Commission – IAG’s misleading rhetoric won’t change history.
“What will change in the future is the huge increase in competition among airlines and choice for passengers that we will deliver by expanding Heathrow. We can’t be held up by IAG simply looking to protect their dominant position and record profits.”
Walsh’s comments came as part of IAG’s official response to a CAA consultation on the early costs of, and regulatory timetable for, expansion at Heathrow.