Heathrow investment plan may lead to ticket price rise

LONDON (Reuters) - A 3 billion pounds five-year investment plan by London's Heathrow airport could see passengers facing a rise in ticket prices.

Heathrow Ltd, the British airport operator formerly known as BAA, on Tuesday said it wants Britain's Civil Aviation Authority (CAA) to allow it to increase charges for airlines to use the airport between 2014 and 2019.

If approved, the charges would increase from the equivalent of 19.33 pounds per passenger for 2012/13 to an upper limit of 27.30 pounds in 2018/19.

The charges will help fund the opening of the airport's new Terminal 2 next year, improved check-in and baggage facilities and the construction of new taxiways and stands to allow Heathrow to accommodate more modern aircraft.

The CAA will publish its final decision on Heathrow's proposals in January 2014.

Heathrow, which expects annual passenger numbers to rise to 72.6 million by 2019 from today's 70 million, said the investment would benefit passengers, despite a likely rise in ticket prices.

"Heathrow faces stiff competition from other European hubs and we must continue to improve the service we offers passengers and airlines," Heathrow's chief executive Colin Matthews said.

Heathrow's two largest carriers, IAG's British Airways and Virgin Atlantic said Heathrow could be improved without penalising customers and airlines.

"In the current economic climate other businesses, in private and public sectors and especially airlines, are making savings and delivering on less money," said Virgin Atlantic's chief operating officer Steve Griffiths. "Airports should not be exempt from that."

(Reporting by Rhys Jones; Editing by Paul Sandle)

Source: http://news.yahoo.com/heathrow-investment-plan-may-lead-ticket-price-rise-074732933--finance.html

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