Heathrow airport ordered to cut passenger charges each year until 2026

Airlines will benefit but airport warns it will result in ‘worse experience’ for travellers

London’s Heathrow airport has been ordered to reduce its landing charges over the next four years, a proposal that will please airlines while the airport said it would result in a worse experience for passengers.

The move by the Civil Aviation Authority deals a blow to the airport, which had argued for higher fees to help protect customer service, at a time when the travel industry is recovering from the pandemic.

The regulator said the average maximum price for each passenger that airlines will pay Heathrow will fall from £30.19 now to £26.31 in 2026. Excluding the effects of inflation, this is equal to a near-6% reduction every year until then.

The CAA said its final proposals would “be in the best interest of consumers”. It is undertaking a consultation and will announce its final decision later this year.

In a bitter dispute, airlines had pushed for a reduction in landing charges, while Heathrow argued that this would hit customer service. The CAA said the two sides had “starkly divergent views on the level of charges for the next five years”.

The airport’s chief executive, John Holland-Kaye, said: “The CAA continues to underestimate what it takes to deliver a good passenger service, both in terms of the level of investment and operating costs required and the fair incentive needed for private investors to finance it.

“Uncorrected, these elements of the CAA’s proposal will only result in passengers getting a worse experience at Heathrow as investment in service dries up.”

Sign up to the daily Business Today email or follow Guardian Business on Twitter at @BusinessDesk

The cap on landing charges was £22 a customer in 2020, but was raised to more than £30 in January.

Richard Moriarty, the CAA chief executive, said: “Today’s announcement is about doing the right thing for consumers. We have listened very carefully to both Heathrow airport and the airlines who have differing views to each other about the future level of charges. Our independent and impartial analysis balances affordable charges for consumers, while allowing Heathrow to make the investment needed for the future.”

The CAA said increased demand for travel was expected to result in a sustained recovery in aviation over the next four years, noting that there had been “sharp increases” in travel in the spring after UK and international travel restrictions were relaxed. Passenger numbers in May were 79% of pre-pandemic levels. However, uncertainties persist into next year, and passenger numbers at Heathrow are not predicted to return to 2019 levels until at least 2025.


Julia Kollewe

The GuardianTramp

Related Content

Article image
Heathrow told to cut passenger charges in move that could lower fares
Decision by Civil Aviation Authority comes despite airport having argued for higher fees

Kalyeena Makortoff and Gwyn Topham

08, Mar, 2023 @8:22 AM

Article image
Heathrow will have to cut passenger charges by about 20% in 2024
Airport, which had hoped to raise fees, loses appeal to UK competition watchdog in provisional ruling

Mark Sweney

08, Sep, 2023 @9:57 AM

Article image
Heathrow insists airport chaos easing thanks to new passenger limits
Daily ceiling of 100,000 passenger departures ‘cuts last-minute cancellations and improves baggage handling’

Kalyeena Makortoff

11, Aug, 2022 @10:15 AM

Article image
Gatwick airport hit by £343m loss as passenger numbers fall
Revenues plunge by 61%, with Covid-19 continuing to take toll on aviation industry

Mark Sweney

28, Aug, 2020 @7:30 AM

Article image
Heathrow overtaken as Europe's busiest airport by Charles de Gaulle
London airport hits out over Covid testing, with passenger numbers below Paris rival

Jasper Jolly

28, Oct, 2020 @10:43 AM

Article image
Heathrow passenger charges could rise by up to 56% by 2023
Airport allowed to increase cost added to tickets but CAA halts plan to nearly double it

Gwyn Topham and Julia Kollewe

19, Oct, 2021 @9:29 AM

Article image
Heathrow hit by £2bn loss as airport calls for more Covid support
Passenger numbers slumped to 22.1m in 2020, the smallest annual total since 1975

Joanna Partridge and Jasper Jolly

24, Feb, 2021 @8:38 AM

Article image
Heathrow has busiest start to year since before Covid lockdowns
More than 5.4m passengers travelled through airport in January, double the 2.6m from 2022

Jasper Jolly

13, Feb, 2023 @9:13 AM

Article image
UK airport passenger numbers drop 75% to 74m in 2020
Airport Operators Association says figures show the devastating impact of Covid-19 restrictions on aviation

Julia Kollewe

13, Jun, 2021 @12:24 PM

Article image
Heathrow Airport bosses to net bonus if third runway awarded
Owner’s annual report shows executives would benefit personally from any expansion despite past denials

Gwyn Topham Transport correspondent

15, May, 2016 @3:20 PM