August 20, 2008

BAA’s Stranglehold on London Looks Set to Be Broken

Competition chiefs are expected to pave the way for a major shake- up of the ownership of some of the UK's biggest airports.

In a preliminary report published today, the Competition Commission (CC) is likely to recommend a break-up of airport operator BAA's "monopoly" of south east England airports which comprise Heathrow, Gatwick and Stansted.

The commission will also give its views on BAA's ownership of its four other UK airports - Southampton, Edinburgh, Glasgow and Aberdeen.

In an "emerging thinking" document published in April this year, the CC said BAA's common ownership of the UK airports "may not be serving well the interests of either airlines or passengers".

Last weekend, BAA chairman Sir Nigel Rudd said he expected the commission to recommend the sell-off of Gatwick or Stansted - or both - together with one of his company's Scottish airports.

It is believed a number of international firms are interested in taking over Gatwick. One of the possible buyers could be the UK's Manchester Airport Group which runs Manchester, East Midlands, Bournemouth and Humberside airports. The CC report, which will be followed by a final report expected before the end of the year, comes at a time of mounting criticism of Spanish-owned BAA.

The company has had to bear the brunt of passenger and political ire during a period where increased customer numbers, stricter baggage regulations, continuous computer glitches and the disastrous Heathrow Terminal 5 opening have combined to the detriment of the airport travelling experience for millions.

Sir Nigel said any break-up of the BAA UK airport empire would not be a disaster for the company and would do little to increase competition at Heathrow, the UK's largest and most important airport.

He stressed that Heathrow did not compete with Gatwick or Stansted or with non-BAA airports such as Luton or Manchester, but with the likes of Paris Charles de Gaulle and Amsterdam's Schipol airport.

Shadow transport secretary Theresa Villiers said: "BAA should be broken up so that it no longer has such a dominant hold over airport capacity in London and the South East. We want to see much more competition between our airports meaning both airlines and passengers get a better deal and less travel misery."

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