Heathrow travelers are set to face increased ticket prices over an extended period to cover the initial expenses of constructing its third runway expansion project. The airport has been granted permission by the Civil Aviation Authority (CAA) to raise its airline fees, which are usually passed on to passengers through airfares, for approximately 20 to 25 years.
The CAA has approved Heathrow Airport Limited (HAL) to recover £320 million invested in the development of the third runway. This decision will result in a rise in the maximum airport charge per passenger by around 15p in 2028, with a projected increase to 30p in the following years.
In addition, Heathrow West, a competing expansion proposal led by property tycoon Surinder Arora, will also be allowed to recoup £4.1 million spent on its plan until November 25, when the government opted for HAL’s proposal.
HAL’s expansion scheme, estimated at £33 billion, includes relocating the M25 at a cost of £1.5 billion. The project is expected to be fully privately funded and aims to boost Heathrow’s annual capacity to 756,000 flights and accommodate 150 million passengers.
The recoverable expenses comprise planning, design work, and material preparation. Future decisions regarding costs incurred from 2027 will be determined through a separate process.
Tim Johnson, the CAA’s director of consumers and markets, emphasized the importance of balancing consumer benefits with cost control in the expansion project. Heathrow Airport expressed optimism that the endeavor will enhance passenger options and provide a substantial economic lift to all regions of the UK.
British Airways, Heathrow’s largest airline, cautioned that early cost recovery by HAL could render the expansion financially burdensome for consumers and undermine the project’s viability, as per a CAA report.
