Virgin Atlantic and British Airways-owner slam Heathrow price cap hike 

Virgin Airlines and British Airways’ owner IAG have slammed the Civil Aviation Authority’s (CAA) decision today to hike Heathrow’s price cap.

The regulator announced the hike this morning, raising the cap for 2023 to £31.57 per passenger, up from £30.19.

The aviation watchdog said the decision will “protect consumers and give certainty to the airport and airlines.” 

The hike in the price cap – the amount Heathrow charges airlines per passenger – is well below what the airport was calling for, however, previously asking for it to be raised to as much as £41.95 per passenger for the period up to 2027.

But the cap, which is calculated based on passenger numbers, has generated huge controversy, with airline bosses accusing the west London hub of downplaying its post-pandemic recovery to get a more favourable price cap hike.

A spokesperson for British Airways’ owner IAG told City A.M. it was disappointing the CAA hadn’t taken into account “the reality of higher traffic volumes, which ought to result in lower prices.”

A Virgin Atlantic spokesperson said the charges were based on Heathrow’s “knowingly undercooked and self-serving passenger forecasts.”

Virgin Atlantic’s chief executive Shai Weiss, said last month that the CAA was “putting the interests of a monopolistic airport and its shareholders ahead of passengers.”

Airline trade body Airlines UK said, that despite being lower than what Heathrow wanted, the 2023 interim price cap was “still too high.”

“At a time when the UK economy needs families and business travellers returning to the skies, we cannot allow Europe’s busiest and most expensive airport to price them out with excessive premiums to their journeys,” a spokesperson told City A.M.

“The CAA can, and must, go further to bring Heathrow’s charges into line with other European hubs in its upcoming determination on the cap to apply until the end of 2026.”

Heathrow has always denied the airlines’ accusations, claiming that pre-Covid passenger levels are still a few years away. 

Heathrow declined to comment today, but said earlier this month that passenger numbers remained in line with expectations, as 61.5 million travellers passed through its gates in 2022. 

The CAA said it will make a decision on the price cap for the period between 2024 and 2027 in March.