A study commissioned by Virgin Atlantic (VS, London Heathrow) has urged the government to change the way take-off and landing slots are allocated at London Heathrow, arguing that this would improve competition when the hub eventually expands, the Financial Times has reported.
The research, by WPI Economics, found that as many as a quarter of all passengers who use the airport only have the option to fly with carriers owned by IAG International Airlines Group. The group has operated 77 monopoly routes from Heathrow during summer 2019, according to the report.
IAG controls 55% of all take-off and landing slots at the airport, followed by Lufthansa Group with 8%, and then Virgin Atlantic together with its joint venture partner Delta Air Lines (DL, Atlanta Hartsfield Jackson) with 7%, the study said.
A third runway at Heathrow, due to come into operation in 2026, will bring 260,000 additional flight movements a year, more than doubling capacity. It will also bring the equivalent of around 350 new daily slot pairs at the severely constrained airport.
The dominance of a single company has been highlighted this week as IAG's British Airways (BA, London Heathrow) saw almost all of its flights grounded during a 48-hour pilot walkout.
A spokeswoman for Virgin told the Financial Times that it was essential that Heathrow's expansion leads to “effective competition that delivers for the whole nation, and this simply cannot be achieved by the continued dominance of one airline group”.
However, IAG countered that Virgin had had opportunities over the last two decades to increase its presence by buying slots on the secondary market. “The airline has failed to create more competition at the airport - it closed Little Red on domestic routes, pulled off long-haul routes, and rents out the slots it owns to other airlines,” a spokeswoman for the group said.
