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Travel industry news

19 Feb 2019

BY James Chapple

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Heathrow slot auction risks ‘higher costs, less choice and less investment’

Iata and IAG say any plans to auction take-off and landing slots at an expanded Heathrow airport would risk pushing up costs for airlines and passengers.

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Heathrow slot auction risks ‘higher costs, less choice and less investment’

The Times, citing a Department for Transport strategy paper, reports ministers are considering selling new slots at Heathrow and Gatwick to improve competition and raise funds.


Presently, new slots are allocated free of charge following common EU rules. However, these slots could be monetised post-Brexit under new aviation regulations.


Heathrow will gain capacity for more than 250,000 new flights a year with the addition of a third runway, which will be distributed across more than 350 slots, The Times reports.


Gatwick is also planning to add more capacity by bringing its emergency runway into full-time usage, adding an extra 50,000 flights a year.


Iata, though, has said the DfT’s proposed changes would favour more profitable routes rather than opening up new destinations.

 

A 2017 House of Commons library paper, meanwhile, warned any such auctions may be biased against smaller carriers “with lower purchasing power”.


Lara Maughan, Iata’s head of worldwide airport slots, said: “Making airlines pay for entering or growing at an airport means consumers will be the losers.

 

"At a time when Britain is looking to improve its competitiveness and to build more connections to the world, these proposed changes will do the exact opposite.


“Extracting even more cash from airlines and their passengers will mean higher costs, less choice and less investment.

 

"The government’s stated objective to improve regional access to Heathrow would be irreparably damaged by an auction system that would force airlines to prioritise the most lucrative long-haul routes.”


An IAG spokesperson added: “We support Iata’s view slot auctions would negatively impact consumers and undermine Britain’s aviation industry.”


A DfT spokesperson told The Times: “We have been clear that any slot allocation system should be designed to stimulate a competitive market and this is just one of a range of options.

 

“We are working with the aviation industry in considering any potential reforms to the system so it delivers the best outcome for passengers.”

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