Heathrow airport will be forced to cut its landing fees after demand for flying recovered from the pandemic faster than expected and airlines successfully lobbied against a significant increase in charges.
The UK aviation regulator on Wednesday said landing fees at the UK hub airport should fall from the current £31.57 per passenger to £25.43 from next year.
The charges are typically passed straight on to passengers through ticket prices. Heathrow and airlines had engaged in a years-long row over whether the airport should be allowed to increase its fees in the aftermath of the pandemic and the fall in passenger numbers.
Heathrow pushed to be allowed to charge much higher fees — as much as £40 per passenger — and warned that investment in the airport was at risk.
But in an increasingly acrimonious dispute, airlines accused the airport of price gouging and deliberately underestimating the speed of the recovery in its passenger forecasts in order to win a better settlement on prices from the regulator.
Senior industry executives have warned that the dispute could rumble on, with Heathrow and the airlines both given six weeks to appeal to the Competition and Markets Authority, the competition watchdog.
The new set of charges, published on Wednesday, represented a final decision from the Civil Aviation Authority for pricing in the regulatory period between 2022 and 2026. The CAA had published a series of proposals and interim prices over the past two years.
Charges will remain at about £25 in 2025 and 2026, the CAA said, and average out at £27.49 for the regulatory period, reflecting higher charges in 2022 and 2023.
The regulator had last summer proposed an average fare of £28.39 over the period, including a charge of £26.31 by 2026, the final year, but lowered it after considering the rapid recovery in passenger numbers against the macroeconomic backdrop, including high inflation.
