There has been an airfield at Heathrow since 1929, it was expanded during WWII to provide for long-range military aircraft servicing the Far East. It was opened as London Airport in 1946 and then renamed Heathrow in 1966. An established global hub with 90 airlines travelling to over 180 destinations in over 90 countries. Heathrow has had its busiest February ever, handling 5.8 million passengers. Post-Covid, in February Heathrow reported a pre-tax profit of £38 million (€ 44.5 million) compared with a loss of £68 million (€80 million) in 2022.
So that is the history, the inheritance. Heathrow’s position in international aviation is a product of Britain’s past as an imperial power and global player. For those readers unfamiliar with the British press the Daily Telegraph is colloquially known as the Tory-graph. Although in recent months it has reflected the multiple divisions within the ruling Tory party.
I was more than surprised to see the headline on a story in the Telegraph on 10th March: Inside the revolution at ‘incompetent’ Heathrow. The article is written by Ben Marlow, Associate Editor and Luke Barr.
Heathrow’s biggest shareholder, Spanish construction giant Ferrovial, has sold its 25% stake to an arm of the Saudi state and a French private equity house: “Ferrovial’s planned exit has provided an opportunity for other shareholders such as Canadian pension fund CDPQ and GIC, Singapore’s sovereign wealth fund, to make their escape, too. Their “tag-along” rights allow them to find a buyer for their pieces of Heathrow at the same price. With as much as 60pc of Heathrow likely to change hands, the gateway to Britain is on track to wave goodbye to its most turbulent times as it bids farewell to one set of owners and welcomes another.”
We shall see whether or not this materializes. It is the next part of their article which is shocking – Heathrow is “revealed” as a cash cow: “Critics accuse successive governments of wrongly allowing this country’s biggest airport to become a cash cow to be milked by overseas shareholders at the expense of much-needed investment. They helped themselves to £4bn of dividends before the pandemic, and even a £106m payment during the downturn. Starved of capital and laden with billions of pounds of debt that has helped to finance generous payouts to its owners, for some passengers and airlines Heathrow has become a tired, overcrowded airport more synonymous with delays and queues than world-class travel. Plans for a third runway at Heathrow that would dramatically boost capacity have become a withered symbol of the malaise.“
In 2023 the airport paid £1.5bn in interest on debt which has climbed from £15.8bn to £16.8bn.
Marlow and Barr continue “As it has lurched from one major crisis to another, the former London Airport has tumbled down the global rankings from the second busiest hub at the turn of the century behind Atlanta’s Hartsfield-Jackson to eighth place, behind Dubai, Paris, and Istanbul…. Some have questioned whether Heathrow’s demise is emblematic of inexorable national decline.”
