Transport Airports

Heathrow Airfares to Jump More Than $300 Without a Third Runway, Says Report

Apr 17, 2014 3:00 am

Skift Take

The report was commissioned by the airport leading to questions about the credibility of claims; however, shrinking capacity will eventually impact the airport, its airlines, and their flyers in some form.

— Samantha Shankman

Free Report: The State of Student Travel

Toby Melville  / Reuters

A jumbo jet takes off shortly before midday from Heathrow Airport in west London April 15, 2010. Toby Melville / Reuters


The average airfare at London’s Heathrow Airport may jump by more than 200 pounds ($336) by 2030 if it continues to operate with only two runways, according to a report commissioned by the airport.

Passengers traveling through Europe’s busiest hub pay 95 pounds more on average for return fares than they would if the terminal had a third landing strip, Frontier Economics, a London-based consulting firm, said today. The additional cost may rise to as much as 320 pounds if the airport isn’t expanded, according to the report.

“This additional burden on both the cost of living for families and on businesses is entirely avoidable,” Heathrow Chief Executive Officer Colin Matthews said in a statement. The British government needs to “end the years of prevarication that are now causing fares to rise and routes to be constrained.”

Heathrow was in December identified as a preferred focus of additional runway capacity serving southeast England in an preliminary report by a state-appointed Airports Commission. While the hub managed to boost traffic last year by hosting larger aircraft, it has operated close to capacity since the start of the decade. The cost of building a new runway would add about 20 pounds per return passenger, Frontier Economics said.

Third Runway

A third runway has the potential to add as many as 40 direct connections from London to cities such as Calcutta, India and the Peruvian capital Lima, Frontier Economics said. That compares to seven new direct links that would be created by adding a runway at Gatwick Airport, south of London, they said.

Howard Davies, chairman of the Airports Commission, said in January that he will base his decision on expanding Heathrow or constructing a second runway at Gatwick Airport, the other short-listed site, on the anticipated nature of future markets. Heathrow might be favored were demand deemed to be focused on transfer traffic, while Gatwick could be suitable if the chief goal was to serve point-to-point travel originating or terminating in London.

The best outcome for passengers would be to allow both Heathrow and Gatwick to expand, as both airports are likely to be “heavily congested” by 2030, Frontier Economics said.

“It is clear that an expansion at both Heathrow and Gatwick would result in a greater benefit to passengers than expanding one or the other,” it said.

To contact the reporter on this story: Kari Lundgren in London at klundgren2@bloomberg.net To contact the editors responsible for this story: Benedikt Kammel at bkammel@bloomberg.net Thomas Mulier, Robert Valpuesta.

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