Heathrow says halting new runway would be 'financial suicide'

[LONDON] London Heathrow airport stepped up its defence of a US$20 billion third runway, saying a government decision to block the project would amount to "financial suicide" and hamper UK efforts to boost trade after Brexit.

Chief Executive Officer John Holland-Kaye sees a larger Heathrow, opposed by campaigners and some politicians because of its environmental impact, as "essential for a global Britain." Thwarting the plan will only benefit competing economies such as France, he said in an interview on Wednesday.

Paris Charles de Gaulle airport is already set to take the title of Europe's busiest hub from Heathrow within two years, the CEO said, with the London site unable to respond due to a lack of spare capacity.

Heathrow's expansion is in doubt after Prime Minister Boris Johnson, who fought against the runway as London mayor, said he saw no immediate prospect of the strip getting built. That's after he warned before December's election that the project had yet to satisfy legal obligations on noise and air pollution.

"You can't have a plan for trade deals with India and China without expanding Heathrow," Mr Holland-Kaye said. "It doesn't compute. If goods and people aren't flying out of an expanded Heathrow they'll fly through Paris. You're taking back control with one hand and giving it back to the French with the other."

Heathrow's bid to serve 142 million passengers a year - up from almost 81 million now - is in the balance despite wining the backing of lawmakers in a 2018 vote. The new runway was also recommended by a government-appointed commission that dismissed Mr Johnson's own proposal for a new hub in the River Thames estuary.

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While the prime minister recently backed the £100 billion (S$180.7 billion) HS2 high-speed rail project, he has continued to push back against Heathrow's plans. Asked on Feb 11 if the runway would now go ahead, he said: "I see no bulldozers at present, nor any immediate prospect of them arriving."

Mr Holland-Kaye said opposition to enlarging Heathrow on environmental grounds is misplaced.

"CO2 is a big issue but there is no conflict in expanding flights if we can de-carbonise aviation," he said. "The idea that the answer is to stop flying and India, China and the US will follow suit is barmy."

BLOOMBERG