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‘Inflation-busting prices threaten regional air links’
Regional air links from Heathrow could be threatened by “inflation-busting” hikes in fees paid by airlines.
The warning came from Bmi, the second largest user of the airport, which reacted angrily to Competition Commission recommendations for higher than expected charges at Heathrow from next April.
The fees per departing passenger at Heathrow in 2007/08 is £18.55 but will almost double to £35.28 in 2012 under the CC recommendations based on an RPI each year of 4.1% as was recorded in August 2007, the airline calculated.
The suggested hike in charges every year over five years “threatens to put under further scrutiny the existence and viability of vital UK regional air links into Heathrow and has the potential of pricing them out of the market,” Bmi warned.
As previously reported by TravelMole, the Competition Commission’s recommended rise in charges are more than those considered by regulator the Civil Aviation Authority but are not binding.
Bmi deputy chief executive Tim Bye said: “We warned the CC that sanctioning inflation-busting price rises at Heathrow could have a devastating effect on vital regional services into Heathrow.
“The availability of routes from key UK regions to feed into a wide range of destinations through the world’s busiest international airport sustains the lifeblood and the economic growth of many of these regions.
“At a time when competition between airlines has demanded that they drive down their costs and generate higher levels of efficiency to survive, we have had to endure inflation-busting increases for the last five years for indifferent levels of service.
“We are now facing even higher increases over the next five years with limited improvements until the opening of the new Heathrow East terminal in 2012.”
by Phil Davies
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