Bangkok--19 Dec--eTurboNews
Airlines in Britain have reacted favorably to an announcement that airport operator British Airport Authority is to undergo an anti-trust investigation. The UK government's consumer watchdog, the Office of Fair Trading, is referring BAA to the Competition Commission, following a series of market studies that uncovered aspects of a near monopoly of airport services, especially around London.
British Airways has called for the break-up of ownership of BAA to encourage competition between London's main airports, Heathrow, Gatwick and Stansted. The airline says it will continue to lobby the aviation regulator, the Civil Aviation Authority (CAA) and the Competition Commission on lowering airport charges.
Budget airline Ryanair called on the Competition Commission to recommend the break-up of the BAA monopoly, which it says has led to high prices and poor services at London's three main airports, Heathrow, Gatwick and Stansted.
"Ryanair has long called for a break-up of the BAA monopoly," said Ryanair chief executive Michael O'Leary. "Heathrow is a shambles, which most passengers if they could, would avoid at all costs. Equally, Stansted where we operate is an over-specified, gold plated Taj Mahal."
"The present ineffective regulatory regime operated by the CAA encourages the BAA monopoly to waste ?4 (US$7.70) billion. building a second runway and terminal at Stansted, when these facilities could easily be built for less than one quarter of this figure," he said.
"Competition works. It leads to more choice and better services for consumers. The competition between Liverpool and Manchester airports has led to reduced charges and improved services for passengers. Equally, in Scotland, the competition between Glasgow Prestwick and Glasgow Paisley has led to lower charges and choice for consumers.
"We again call for the break up of the BAA monopoly. Heathrow, Gatwick and Stansted should be spun out into separately owned, independent, competing airports, where the market and airport users will have more influence over the type of low cost, efficient facilities that are provided, and so we finally do away with the era of gold plated Taj Mahal palaces and high prices favored by the BAA monopoly".
The Spanish-owned airport operator denied it had abused its monopoly of London's biggest airports. "As the operator of the UK's three largest airports, Heathrow, Gatwick and Stansted, it is right that BAA's ownership is subject to regular public scrutiny," said BAA chief executive Stephen Nelson. "Our belief is that BAA's structure has benefited both passengers and airlines and BAA has not abused its monopoly.
"The main issue facing the UK is a lack of terminal and runway capacity in the South East of England which results in delay and congestion. This problem has not arisen because of BAA's structure, but instead is the result of the UK's complex planning laws, an antiquated regulatory system and inflexible slot allocation. Lack of capacity is a complex issue therefore it would be wrong to jump to quick and simplistic conclusions about structure."
Mr. Nelson said the airlines' reaction to the news was not surprising. "I fully understand why airlines like British Airways and Ryanair want to weaken BAA and achieve greater control over prices and investment at the airports they dominate. This should not be confused with acting in the passenger interest."