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Despite stalled growth in China, Brazil and Russia, a wave of newly middle-class travelers from the BRICs and beyond will start visiting international destinations in the coming decades — dwarfing the numbers we’ve seen thus far.
You can’t imagine Lufthansa taking on Frankfurt and Munich in the same way, but you also can’t imagine Willie Walsh not mouthing off in this way.
Willie Walsh, the boss of British Airways‘ parent company, rebukes Heathrow over investment claims after a major pension fund buys a near 9pc stake in the airport.
Willie Walsh has accused Heathrow Airport of spreading “scare stories” and expertly “gaming” Britain’s regulatory system to bump up prices for airlines and passengers.
The boss of British Airways owner IAG hit out at Heathrow over claims that it will lose investors if it is not allowed to generate higher returns . He said last week’s £392m purchase by Britain’s second biggest pension scheme of a stake in the hub “blows a hole” in the airport’s arguments. The deal saw the Universities Superannuation Scheme buy an 8.65pc holding from Ferrovial, Heathrow’s top investor.
The sale was struck at a 13pc premium to Heathrow’s Regulatory Asset Base – the regulator’s proxy for the airport’s value.
“Without question there is no shortage of investors who would be willing to take a stake in Heathrow,” said Mr Walsh. “It is almost insulting that they announce the sale of a stake to a significant player like USS at the same time that they have been arguing that if they don’t get excessive reward at Heathrow, investors will leave.”
Heathrow and major airlines have been at loggerheads over how much the airport should be allowed by the regulator, the Civil Aviation Authority, to charge airlines for using its facilities from next year. The landing charges are inevitably always passed on to passengers.
Mr Walsh said he is talking to Gatwick and London City Airport and would be prepared to move planes to rival airports in protest.
“Heathrow are experts at gaming the regulatory system,” he said.
A Heathrow spokesman said: “There is no new capital investment for Heathrow as part of the USS transaction. One investor has sold, another has bought. Shareholders have not yet made anything approaching a market return on equity.”