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Airport Country | Region Quick News Ukraine

London Heathrow faces a new harsh reality

  • 5 million passengers traveled through Heathrow in April, with outbound leisure travelers and Brits cashing in airline travel vouchers driving the recovery in passenger demand which is expected to last throughout the summer. As a result, we have increased our 2022 forecast from 45.5 million passengers to nearly 53 million – a 16% increase on our previous assumptions 
  • Despite the increase in passenger numbers, Heathrow delivered a strong service throughout the Easter get away – with 97% of passengers through security within ten minutes compared to queues of over three hours at other airports. To maintain the service our passengers expect over the summer, we will be reopening Terminal 4 by July and are already recruiting up to 1,000 new security officers 
  • The ongoing war in Ukraine, higher fuel costs, continuing travel restrictions for key markets like the United States, and the potential for a further variant of concern create uncertainty going forward. Together with last week’s warning from the Bank of England that inflation is set to pass 10% and that the UK economy will likely ‘slide into recession’ means we are taking a realistic assessment that travel demand will reach 65% of pre-pandemic levels overall for the year
  • Heathrow’s largest carrier British Airways announced last week that it is expecting a return to only 74% of pre-pandemic travel this year – just 9% more than Heathrow’s forecasts which have proven to be amongst the most accurate in the industry during the pandemic 
  • Heathrow expects to remain lossmaking throughout this year and does not forecast paying any dividends to shareholders in 2022.  Some airlines have predicted a return to profitability this quarter and expect to resume paying dividends as a result of the ability to charge increased fares
  • The CAA is in the final stages of setting Heathrow’s airport charge for the next five years. It should be aiming to set a charge that can deliver the investments passengers want with affordable private financing while withstanding the shocks which are undoubtedly to come. Our proposals will deliver the easy, quick, and reliable journeys passengers want for less than a 2% increase in ticket prices. We have proposed an option for the CAA to lower fees by a further £8 and to repay airlines a cash rebate if more people travel than expected. We urge the CAA to carefully consider this common-sense approach and avoid chasing the low-quality plan being pushed by some airlines which will only result in the return of long queues and more frequent delays for passengers  

About the author

Juergen T Steinmetz

Juergen Thomas Steinmetz has continuously worked in the travel and tourism industry since he was a teenager in Germany (1977).
He founded eTurboNews in 1999 as the first online newsletter for the global travel tourism industry.

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