Airlines back UK airports break-up

Ryanair and British Airways have both welcomed the UK Competition Commission’s Issues Statement
on their investigation of the BAA airports monopoly. British Airways believes competition between airports will improve customer service levels and lead to more investment in new infrastructure.

The airline believes that separate ownership of Heathrow and Stansted airports is key so that decisions about new runway construction in South East England are not concentrated in the hands of one company.

Willie Walsh, British Airways’ chief executive, said: “Common ownership is the root cause of the failure to expand Heathrow’s runway capacity. There is huge unsatisfied demand for extra runway capacity at Heathrow from customers and airlines and less demand at Stansted. At both airports, as long as environmental conditions are respected, new runway developments should be market-led not left to a common owner’s interests to dictate timescales.

“A more competitive London airports market would encourage the building of new facilities which would benefit both customers and the UK. The damaging consequences of common ownership are all too apparent today in the fragility of Heathrow’s day-to-day operation”.

Meanwhile Ryanair’s Head of Regulatory Affairs and Company Secretary, Jim
Callaghan, said:

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p>“The Competition Commission has now identified the various issues where
the ongoing common ownership by the BAA of the main London airports is
damaging the development and operation of these airports and is damaging
to the travelling public.  The BAA needs to be broken up urgently in
the best interests of British consumers, visitors to the UK and airline
users.

 

“The situation has now reached crisis levels. BAA have doubled passenger
charges in Stansted airport and passenger numbers have fallen for the
first time since Ryanair began operating to Stansted in 1991.  As a
result, routes have been cancelled and frequencies reduced.  Passenger
queues at security and immigration have also reached crisis levels with
passengers being forced to wait in excess of one hour.  BAA also
continue to waste money and ignore the needs of users by building
inefficient, gold plated airport facilities at Stansted Airport, which
will lead to another doubling of passenger charges and a further
reduction in passenger numbers and routes from London.

 

“We are therefore calling on the Competition Commission to expedite its
investigation of the BAA and to force a break up of this abusive
monopoly as soon as possible in the interest of consumers.  It is clear
that the situation will continue to deteriorate until competition is
introduced in the London airports market.”

The International Air Transport Association also reacted
positively to the UK Competition Commission’s Statement of Issues.

Giovanni Bisignani, IATA’s Director General and CEO said:

“The Competition Commission has confirmed what every traveler through a
BAA airport knows: that it needs desperately fixing and fast.

The current airport structure and regulatory system is not working. Lack
of investment by the BAA airport monopoly is delivering
embarrassingly-low service levels on everything from security wait-times
to baggage delivery and almost everything in-between. This must change.

The regulator has failed to put in place effective incentives to deliver
acceptable service levels. As a result, Heathrow is an out-of-control
monopoly that gets away with pocketing a 42% margin at the expense of
the 68 million beleaguered passengers using its poor facilities each
year.

The Competition Commission’s inquiry will play a critical role in
defining the best long-term airport structure to deliver world-class
airport facilities at the most important global hub.

At the same time, we cannot wait a year to start improving. Heathrow
traffic is down 1.7% while the rest of the world is growing.  The
unfortunate reality is that passengers are avoiding the mess at Heathrow
and this impacting the UK’s competitiveness. The UK’s unique one-bag
rule must be reviewed and brought in line with global standards.  And
immediate further investment by Heathrow in adequate staff and equipment
to handle demand is urgently needed.”

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