News: Airlines call for end of BAA monopoly

Flights > News > # 1399 (01/08/2007)

The Times has reported that Britain’s largest airlines want BAA’s control of Heathrow to be broken by a sale of individual terminals to rival companies.
Virgin Atlantic and British Airways are understood to have told the Competition Commission, which is investigating BAA’s monopoly control of London’s airports, that individual terminal owners would improve the level of service at Heathrow.
A similar system is used at a number of American airports, and airlines can negotiate better conditions and more space by threatening to shift operations to a new terminal.
Virgin is also understood to be proposing that BAA, which was bought by Ferrovial, the Spanish construction group, for £10.3 billion last year, be forced to sell Gatwick. British Airways is allegedly calling for the Government to force a sale of Stansted.
The Competition Commission inquiry will report next year and sources familiar with the hearings said that nearly every submission favours breaking BAA’s London monopoly.
Airline executives who use BAA’s facilities complain that they and their customers are being offered poor service by the company. They have accused BAA of putting profits and retailing ahead of investment in infrastructure. Airlines such as BA have also given warning that overcrowding and the Government’s new security restrictions on hand baggage are deterring people from travelling through the UK.
Ken Livingstone, the London Mayor, added to the criticism of BAA yesterday, saying that Heathrow “shamed” the British capital. “It’s quite clear that the current management, and the management before them, at BAA thought they could keep people almost as prisoner in this ghastly shopping mall so they can extract vast sums of money from them while they wait in appalling conditions,” he said.
A BAA spokesman told The Times: “We are not deaf to the concerns of business leaders about Heathrow and we have got a plan in place to address them.
We are adding Terminal 5 to increase capacity. Accusations that we are operating a shopping mall are misjudged. Revenue from retail operations enables us to keep landing fees low.”
On Monday, Giovanni Bisignani, the director-general of IATA, which represents 240 international airlines, criticised BAA for “embarrassingly low service levels”.