Virgin Atlantic Unhappy With Heathrow Price Cap

In the latest spat with Heathrow Airport, Virgin boss Shai Weiss has said that the price cap only has the interests of the "monopolistic airport" in mind.



December 11, 2022

DALLAS - Virgin Atlantic (VS) boss Shai Weiss has reacted angrily to proposals by the UK’s Civil Aviation Authority (CAA) to implement an interim price cap on passenger charges at London Heathrow (LHR) next year.

Weiss said the proposed cap of £31.57 per passenger is about “putting the interests of a monopolistic airport and its shareholders ahead of passengers.”

"Strong and growing demand for travel means that the UK’s only hub airport, which is already Europe’s most expensive, is materially outperforming its own forecasts. By maintaining a pessimistic outlook for 2023 passenger forecasts, not only do customers face excessive charges but potentially also a poorer airport experience,” Weiss continued in a statement from the airline. “We expect the CAA to use its powers to course correct, so that accurate and realistic forecasts inform both the 2023 cap and the final determination for the regulatory control period ending December 2026.”

Virgin are also looking for a renovation of its LHR Terminal 3 home. Photo: Virgin Atlantic.

Price Cap Plans

The CAA said that the charges were part of its plans to reduce the average price cap by 6% annually over the next five years. This was first announced in June and would see charges fall to £26.31 in 2026, subject to inflation-linked increases. However, LHR’s users are accusing the airport of wanting to “drive up passenger charges” after proposing the charges be set at £41.95 per passenger to scrape back losses racked up during the pandemic.

This is the latest spat between Weiss and LHR after the VS boss revealed that he was no longer in favour of the contentious third runway project at the airport. However, LHR CEO John Holland-Kaye said he anticipated “having a positive relationship and dialogue” with the airline moving forward.

VS is the second biggest operator at LHR with just over 4% of the total landing slots held. Photo: Ervin Eslami/Airways.

"Frustrating and Disappointing"

Meanwhile, IATA boss Willie Walsh called the CAA’s decision “frustrating and disappointing.”

Heathrow owners Ferrovial said the delay was “disappointing” and that “The uncertainty caused by this delay is undermining our ability to commit capital to fund crucial investments to improve Heathrow’s experience for airlines and passengers.” It is now calling on the CAA “to finalise its proposals as soon as possible.”

The CAA has responded by saying that the interim cap will allow a final decision on the price cap to be made “in an orderly way.”

Featured Image: Virgin Boss Shai Weiss has reacted angrily to the CAA's introduction of a price cap at LHR for 2023. Photo: Francesco Cecchetti/Airways.