Heathrow could be compelled to allow other companies to design and build its third runway and new terminal, under proposals from the UK aviation regulator aimed at reducing costs. The Civil Aviation Authority (CAA) has suggested changes to the regulatory model governing Heathrow, including requiring the operator to seek competitive bids for parts of the expansion project.
The CAA's review argues that allowing rival bids could encourage competition and efficiency. The most radical proposal would permit another developer to tender for building and running its own terminals at Heathrow, similar to a scheme at JFK airport in New York, though this would require special government approval.
Heathrow's expansion, backed by ministers last November, aims for the runway to be operational by 2035, with formal planning approval sought by 2029. The cost has been a point of contention, with British Airways' owner IAG capping its support at £30bn. Heathrow is considered Europe's most expensive airport, and the CAA recently rejected its plans to raise landing fees.
Arora Group, which promotes a £25bn alternative scheme, welcomed the CAA consultation. Founder Surinder Arora said: 'Two years ago competition at Heathrow wasn't on the cards and now is very much alive and kicking because the case for change is so strong.' However, Heathrow warned the proposals could 'undermine efforts' to expand and delay economic growth.
