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Last Updated:  Friday, 28 February, 2003, 16:24 GMT
Airlines attack rise in landing charges
by Simon Montague
BBC transport correspondent

Sir Richard Branson
Sir Richard Branson: Decision is "sheer madness"
Britain's biggest airlines have united in anger over inflation-busting increases in landing charges at Heathrow airport.

British Airways boss Rod Eddington said a decision by the Civil Aviation Authority to allow increases of 6.5% above the rate of inflation for the next five years, was "bad news for the travelling public, who will end up paying higher prices".

Virgin Atlantic chairman Sir Richard Branson called it "sheer madness".

And Bmi British Midland said it was "appalled".

But Heathrow's owner BAA has greeted the CAA's pricing formula as "tough but realistic".

Bad news?

The company has told the regulator that it needs bigger-than-inflation rises to pay for the construction of a fifth terminal.

The CAA has set Heathrow's landing charge next year at 6.48 per passenger.

British Airways said increases over the next five years would add add 10 to a ticket.

The increases were "bad news for the travelling public and bad news for an industry already in financial distress".

Fellow airline Bmi said BAA's threat not to invest in extra capacity if higher charges were rejected was "the most successful game of call my bluff in business history".

The CAA had "caved into pressure for profits from a monopoly supplier".

Virgin has vowed to fight the decision, and is considering legal action.

But the CAA has said that the new charging regime for Heathrow won't "materially affect" air fares, and was needed to help pay for a 7.4bn investment programme at Heathrow, Gatwick and Stansted over the next decade.




SEE ALSO:
London air fares could rise
28 Feb 03 |  Business
Air fares slashed in price war
29 Jan 03 |  Business
Compensation threat to air fares
06 Dec 02 |  Business
Ryanair cuts Buzz routes and jobs
26 Feb 03 |  Business


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